NARRATOR: A manager's attitude can greatly affect the work environment for employees. Today, we're going to discuss McGregor's Theory X and Theory Y, and this has to deal with the perceptions that managers hold for their employees and the way that they generally behave.

So to start out, we have Theory X. Managers who fall into the Theory X category tend to believe that most employees do not like working and will avoid it as much as possible. In order for their employees to get work done, the manager feels that they need to control, threaten punishment, and force workers to do their job. They also think that most employees prefer to be directed, that they'll avoid responsibility at all costs, and that they have low ambition. And lastly, they think that employees are motivated by fear and money.

As you can imagine, a manager who would fall under Theory X tends to watch the employees really closely. They'll tell the employees exactly what to do, what not to do, and generally, punishment is more common than reward. They tend to not hand out tasks that include responsibility, and take those on themselves and give more menial tasks to employees.

On to Theory Y. As you can imagine, this is quite different than Theory X. A manager who tends to fall under Theory Y would assume that employees like to work, that people enjoy working towards a goal, that their commitment to goals increases based on the perceived reward for achieving them, that most employees seek responsibility, and that employees' imagination, creativity, and cleverness can be used to solve problems. They also believe that in an industry, the average person's intellectual potential is only partially realized, and lastly, people are motivated by a variety of rewards. So employees might try to find out what motivates each employee and try to reward them based on their unique motivators.

Managers that have more of a Theory Y style tend to be more relaxed in their approach to management, where employees are more free to set their objectives. They maybe have some more authority, and they also get more flexibility. A manager might try to build an employee up so that they can feel more empowered and feel comfortable making important decisions that relate to their position.

So now that we've covered Theory X and Theory Y, I want you to think about your current and past employers and consider which traits they've shown, whether they've shown some from Theory X or some from Theory Y.

OK, drum roll. Now it's time for the quiz. We are going to go through a couple of different scenarios, and I want you to guess whether it is Theory Y or Theory X.

Susie has been working for Bill, the supermarket manager, for about five months, and she knows her job well and she knows exactly what needs to be done. But every single morning, he comes in and watches her stack the shelves and nitpicks about every little thing, making sure it's perfect. Susie complies, but it makes her feel about this big. So is this Theory X or Theory Y? And the answer is Theory X.

Emma is an entry level marketing employee, and she works under Tina, who is a midlevel marketing manager. Emma is full of ideas for unique marketing campaigns, and while it's not necessarily her job, Tina encourages this. She shares her ideas with the other managers and sometimes with the CMO, if she feels that it's a really strong idea. Emma absolutely loves that Tina sees her creativity and helps to foster it. So what type of theory is this, X or Y? And the answer is Theory Y.

Teddy just came to tell Barb, his boss, that he had completed the spreadsheets for their upcoming meeting. He had stayed up all night working on them and had gone through them carefully to ensure that they were just so. Barb takes one look at them, and instead of saying anything positive about the spreadsheet, she immediately says, I don't like the look of it and tells him to go change it.

Teddy responds calmly to Barb, but then when he gets back to his room, he is just so upset. Her response to him just really makes him not want to work very hard for her. So is this Theory X or Theory Y? The answer is Theory X.

Samantha works in sales and John is her boss. She just landed a huge account, and she went in to tell him. John complimented her on how hard she's been working to land this account, and they did a little celebratory cheer. So which theory is this, X or Y? It is Theory Y.

All right, so today we've covered the basics of McGregor's Theory X and Theory Y. I want you to think about these two management styles and the effect that they have on employees. And just remember this as you move forward if you get into managerial positions, if that's the route you want to go, just to be aware of how these affect others and the tone that you want to set.

Thanks for watching, everyone.

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