McGregor's theory X and Y is built on contrasts of a conventional concepts of management's task - Theory X - with a new, theoretically informed Theory Y.
Theory X Assumptions:

motivation-1.jpgManagement is responsible for organizing the elements of productive enterprise— money, materials, equipment, people—in the interest of economic ends.
  • With respect to people, this is a process of directing their efforts, motivating them, controlling their actions, modifying their behavior to fit the needs of the organization.
  • Without this active intervention by management, people would be passive— even resistant—to organizational needs. They must therefore be persuaded, rewarded, punished, controlled—their activities must be directed.
  • The average man is by nature indolent—he works as little as possible.
  • The average man lacks ambition, dislikes responsibility, prefers to be led.
  • The average man is inherently self-centered, indifferent to organizational needs.
  • The average man is by nature resistant to change.
  • The average man is gullible, not very bright, the ready dupe of the charlatan and the demagogue.

Theory Y Assumptions:
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  • Management is responsible for organizing the elements of productive enterprise - money, materials, equipment, people - in the interest of economic ends.
  • People are not by nature passive or resistant to organizational needs. They have become so as a result of experience in organizations.
  • The motivation, the potential for development, the capacity for assuming responsibility, the readiness to direct behavior toward organizational goals are all present in people. Management does not put them there. It is a responsibility of management to make it possible for people to recognize and develop these human characteristics for themselves.
  • The essential task of management is to arrange organizational conditions and methods of operation so that people can achieve their own goals best by directing their own efforts toward organizational objectives.




References:
McGregor, D. (1960). The human side of enterprise. New York, 21.
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