Business Management Assessment

Business Management Assessment

Theory X and Theory Y Attitudes

Source: Lussier, R. N. & Achuia, C. F. (2010). Leadership: Theory, Application, & Skill Development. Mason, OH: South-Western Cengage Learning

Instructions: For each pair of statements, distribute 5 points based on how characteristic each statement is of your attitude or belief system.· If the first statement totally reflects your attitude and the second does not, give 5 points to the first, and 0 points to the second. If it’s the opposite, use 0 and 5.· If the statement is usually your attitude, then the distribution can be 4 and 1, or 1 and 4.· If both statements reflect your attitude, the distribution should be 3 and 2, or 2 and 3.The combined score for each pair of statement must equal 5.
0 – 5 or 5 – 0One of the statements is totally like you, the other is not like you at all.
1 – 4 or 4 – 1One statement is usually like you, the other not.
2 – 3 or 3 – 2Both statements are like you, although one is slightly more like you.
1.People enjoy working.
People do not like to work.
2.Employees don’t have to be closely supervised to do their job well.
Employees will not do a good job unless you closely supervise them.
3.Employees will do a task well for you if you ask them to.
If you want something done right, you need to do it yourself.
4.Employees want to be involved in making decisions.
Employees want the managers to make the decisions.
5.Employees will do their best work if you allow them to do the job their own way.
Employees will do their best work if they are taught how to do it the one best way.
6.Managers should let employees have full access to information that is not confidential
Managers should give employees only the information they need to know to do their job.
7.If the manager is not around, the employees will work just as hard.
If the manager is not around, the employees will take it easier than when being watched.
8.Managers should share the management responsibilities with group members.
Managers should perform the management functions for the group.


To determine your attitude or belief system about people at work, add up the numbers (0-5) for the first statement in each pair. (Don’t bother adding the numbers for the second set of statements.)The total should be between 0 and 40. Place your score on the continuum below.
Theory X0510152025303540Theory Y
Your Score
Generally, the higher your score, the greater your Theory Y beliefs, and the lower the score the greater your Theory X beliefs.

Discussion Questions:

Where do you fall on the continuum?

Where do you think these beliefs / attitudes come from?

If you fall on the Theory X side (20 or less), what are the implications for you, as a manager / leader? What are the implications for your employees or followers?

If you fall on the Theory Y side (25 – 40), what are the implications for you, as a manager / leader? What are the implications for your employees or followers?

What is the Pygmalion Effect and how does that relate to this exercise?

Theory X and Theory Y

In 1960, Douglas McGregor formulated Theory X and Theory Y suggesting two aspects of human behaviour at work, or in other words, two different views of individuals (employees): one of which is negative, called as Theory X and the other is positive, so called as Theory Y. According to McGregor, the perception of managers on the nature of individuals is based on various assumptions.

Assumptions of Theory X

· An average employee intrinsically does not like work and tries to escape it whenever possible.

· Since the employee does not want to work, he must be persuaded, compelled, or warned with punishment so as to achieve organizational goals. A close supervision is required on part of managers. The managers adopt a more dictatorial style.

· Many employees rank job security on top, and they have little or no aspiration/ ambition.

· Employees generally dislike responsibilities.

· Employees resist change.

· An average employee needs formal direction.

Assumptions of Theory Y

· Employees can perceive their job as relaxing and normal. They exercise their physical and mental efforts in an inherent manner in their jobs.

· Employees do not need threat, external control and coercion to work, rather they can use self-direction and self-control if they are dedicated and sincere to achieve the organizational objectives.

· If the job is rewarding and satisfying, then it will result in employees’ loyalty and commitment to organization.

· The average employee recognizes responsibility and may seek additional responsibility.

· The employees have skills and capabilities, which should be fully utilized. In other words, the creativity, resourcefulness and innovative potentiality of the employees can be utilized to solve organizational problems.

Thus, we can say that Theory X presents a pessimistic view of employees’ nature and behaviour at work, while Theory Y presents an optimistic view of the employees’ nature and behaviour at work. If correlate it with Maslow’s theory, we can say that Theory X is based on the assumption that the employees emphasize on the physiological needs and the safety needs; while Theory X is based on the assumption that the social needs, esteem needs and the self-actualization needs dominate the employees.

McGregor views Theory Y to be more valid and reasonable than Theory X, and encouraged cordial team relations, responsible and stimulating jobs, and participation of all in decision-making process.

Implications of Theory X and Theory Y a few organizations still use Theory X today. Theory X encourages use of tight control and supervision. It implies that employees are reluctant to organizational changes. Thus, it does not encourage innovation. organizations are using Theory Y techniques. Theory Y implies that the managers should create and encourage a work environment which provides opportunities to employees to take initiative and self-direction. Employees should be given opportunities to contribute to organizational well-being. Theory Y encourages decentralization of authority, teamwork and participative decision making in an organization. Theory Y searches and discovers the ways in which an employee can make significant contributions in an organization. It harmonizes and matches employees’ needs and aspirations with organizational needs and aspirations.



Self-Fulfilling Prophecy and the Pygmalion Effect


The Pygmalion effect: “the phenomenon whereby one person’s expectation for another person’s behavior comes to serve as a self-fulfilling prophecy” (Rosenthal, R. American Psychologist 58.3 [November 2003], p. 839).

The Pygmalion phenomenon characterizes many leader-follower relationships: a manager or supervisor, a military commander, an athletic coach, or an instructor. When leaders’ expectations of their followers are raised, they behave in ways that cause their followers, be they employees, soldiers, athletes, or trainees, to perform better. Pygmalion effects have been produced in schools, work organizations, armies, courtrooms, summer camps, and nursing homes, as well as in the practice of clinical psychologists and consultants. Rosenthal and Jacobson’s work Pygmalion in the Classroom (Rosenthal and Jacobson 1968, cited under Pygmalion in the Classroom) first demonstrated the Pygmalion effect experimentally in elementary school classrooms, and there is cumulative field-experimental support for the Pygmalion approach among adults in organizations and work settings, including factories, service organizations, banks, and military units.

The Pygmalion effect is an interpersonal motivational phenomenon that begins with high leader expectations. Conveyed to followers orally or nonverbally via leader behavior, the leader’s high expectations augment the followers’ self-expectations and self-efficacy (i.e., their belief in their ability to perform better), boosting motivation and effort, and culminating in enhanced performance. Often, this improved performance reinforces the leader’s high expectations, thus extending an interpersonal exchange to an upward spiral of high expectations sparking high performance and justifying continued high expectations that produce still higher performance. In this way, self-fulfilling prophecy (SFP) can become self-sustaining prophecy.

However, SFP is a double-edge sword, in that it can be negative. Contrasted with the Pygmalion effect is the negative Golem effect, in which lowering manager expectations impairs subordinate performance—expect dumbbells and you will get dumbbells. Another type of SFP is the Galatea effect, in which the individual’s own high self-expectations become self-fulfilling.

The appeal of the Pygmalion approach for management is rooted in its ability to boost performance based on a cost-free investment of managerial mindfulness and communication of high expectations. This implies a two-fold practical agenda: to raise productivity, managers must both implant high expectations and counteract any manifestations of contrary expectations. The essence of the Pygmalion effect is that managers get the workers they expect. Those who expect more, get more. The converse is true, too: those who expect less, get less. All managers can play a Pygmalion role by cultivating in themselves high expectations regarding their subordinates and by fostering in their subordinates high self-efficacy and high self-expectations. High expectations are too important to be left to chance; they should be built into manager-worker relationships and should be part of all managerial leadership training and development.