• Theory X and Theory Y
• Theory X
• Theory X - The Hard Approach and Soft Approach
• The Problem with Theory X
• Theory Y
• Theory Y Management Implications

Theory Y

The higher-level needs of esteem and self-actualization are continuing needs in that they are never completely satisfied. As such, it is these higher-level needs through which employees can best be motivated.

Theory Y makes the following general assumptions:

• Work can be as natural as play and rest.
• People will be self-directed to meet their work objectives if they are committed to them.
• People will be committed to their objectives if rewards are in place that address higher needs such as self-fulfillment.
• Under these conditions, people will seek responsibility.
• Most people can handle responsibility because creativity and ingenuity are common in the population.

Under these assumptions, there is an opportunity to align personal goals with organizational goals by using the employee's own quest for fulfillment as the motivator. McGregor stressed that Theory Y management does not imply a soft approach.

McGregor recognized that some people may not have reached the level of maturity assumed by Theory Y and therefore may need tighter controls that can be relaxed as the employee develops.