While commenting on the traditional managerial strategies, Chris Argyris has insightfully observed that such strategies for the direction and control of the human resources of an enterprise are eminently suited to the capacities and characteristics of the child rather than the adult people at the top, according to McGregor, hold two process exercised by top management. These alternative views have been called “Theory X” and “Theory Y”. The assumptions about human nature and human behaviour underlying “Theory X” and “Theory Y” are as follows:
(1) The average human being has an inherent dislike of work and will avoid it if he can.
(2) Because of this human characteristic of dislike of work, most people must be coerced, controlled, directed, threatened with punishment to get them to put forth adequate effort towards the achievement of organisational objectives.
(3) The average human being prefers to be directed, wishes to avoid responsibility, has relatively little ambition and wants security above all.
(1) The expenditure of physical and mental effort in work is as natural as play or rest. The average human being does not inherently dislike work.
(2) External control and the threat of punishment are not the only means for bringing about effort towards organisational objectives. Man will exercise self-direction and self-control in the service of objectives to which he is committed.
(3) Commitment to objectives is a function of the rewards associated with their achievement.
(4) The average human being learns, under proper conditions, not only to accept but to seek responsibility. Avoidance of responsibility, lack of ambition, and emphasis on security are generally consequences of experience, not inherent human characteristics.
The assumptions of Theory Y are diametrically opposite to those of Theory X. These assumptions hold out different conception of man as a positive and dynamic being with substantial potentialities for growth and development. The implications for management control are obvious. To quote McGregor, “If employees are lazy, indifferent, unwilling to take responsibility, intransigent, uncreative, uncooperative, Theory Y implies that the causes lie in management’s methods of organisation and control.”
Control, according to this line of reasoning, need not be rigid and static. It is the management’s responsibility to understand the behaviour of organisational participants and take appropriate steps in specific situations. The manager has to be an able diagnostician and organisational medicine man. A variable and flexible control system follows from this management style.
Since management has to ensure best use of human resources to get the organisational objectives fulfilled, Hezberg’s motivation–hygiene concept has significant bearing on organisational control system.
Appropriate managerial strategy for effective use of human resources has been the subject of research by another eminent behavioural scientist, Rensis Likert. He has evolved four types of management systems called system 1, 2, 3 and 4. System 1 represents classical organisational design, and system its opposite. In terms of leadership process, motivational process, communication process, interaction process, decision process, goal-setting process, and performance goals, the system 4 model encourages greater utilisation of the human potential and leads to significant improvement in organisational performance. The assumptions and approaches of McGregor’s Theory Y are incorporated in Likert’s system 4 model. The control process in this model envisages dispersal of decision-making throughout the organisation, and it emphasises selfcontrol and participative problem-solving.