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The Ultimate Triumph of Theory Y

Can you remember your first training model?

I don't mean that dishy graduate from the IT training team or that handsome hunk from the consultancy.

I mean a theory of how people behave and relate in organisations.

I can.

It was Theory X and Y and it was nearly 35 years ago.

At the time, as a junior manager in a big food company, my introduction to Douglas McGregor's theory of human motivation hit me like a thunderbolt from the blue.

I can still recall the flipchart where my trainer drew a vertical line down the paper and on one side, under "Theory X", wrote that "people are lazy, will only work for money, and do no more than they have to".

And then, on the other side, to my growing fascination, wrote under "Theory Y" that "people want to learn, want to grow, and want to become something."

Looking back, I guess that day changed everything I had assumed about people and work, changed how I wanted to manage them, and turned me into a devotee of personal development.

In short, it made me a fan of Theory Y.

Imagine then my shock and horror to discover that, far from having changed everyone else back in the 1970's into Theory Y advocates, Theory X is still alive and well and thriving in a bank near you.

I know this because of accounts of the management style of Sir Fred Goodwin, until last year chairman of the Royal Bank of Scotland, one of the biggest banks in the world.

These accounts relate how every day during his tenure as chairman, Sir Fred would summon his top executives to his office at 9.30 prompt and grill them mercilessly about the shortcomings of any branch and its staff.

If any branch were under-performing, he would humiliate the poor executive responsible, using his favourite phrases, "I think you're asleep at the wheel" and "that's life in the big city, chum".

Sir Fred became known as Fred the Shred for his people-destroying management style. A Theory X manager incarnate.

I'm not glad that the Royal Bank of Scotland has crashed with huge debts and been bailed out by the taxpayer. Nor am I glad that in the year since its demise, thousands of hardworking bank staff have lost their jobs. And I'm certainly not glad that Sir Fred Goodwin jumped the ship in time by negotiating a massive pension for himself right at the moment in the mid-night hours when it looked as if the bank was about to run out of money for all its customers.

However, I am glad that, nearly 50 years after McGregor produced his theory, and 30-odd years after I discovered it, Theory Y has won the day.

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