Performance Objectives, ‘Theory X’ and ‘Theory Y’

ObjectivesWhat have performance objectives got to do with theories about management style? Quite a lot, I think, as I was reminded when I came across some work I’d written some years ago which included reference to the late, great management professor Douglas McGregor and his ‘Theory X and Theory Y’ work on management style

Here’s a quick summary of the theory (as I understand it):

  • Theory X an authoritarian management style that based on the assumption that employees are inherently lazy, dislike work and generally avoid it
  • Theory Y a participative management style based on the assumption that employees will manage themselves to achieve organisational objectives – to the degree that they are committed to those objectives

There has been a lot of debate over the years about the effectiveness of both of these styles but I think it’s fair to say that most managers are more comfortable with ‘Theory Y’ management than ‘Theory X’

OK, but does ‘Theory Y’ actually work? Or maybe a more useful question is ‘how do you make the ‘Theory Y’ management style actually work?’ Let’s focus here on just one area

Did you notice the final part of the ‘Theory Y’ description ‘to the degree that they are committed to those objectives’? What would you say influences your employee’s commitment to your organisation’s objectives? Could your employee’s commitment be improved?

Here are a couple of ideas that could work

1. Make the organisation’s objectives clear

Are your employees crystal clear on what your organisation’s key objectives are? Are you sure? Here’s my experience. In my workshops I often make a proposition that

Organisations exist for one purpose only – to meet their corporate objectives

I then ask

What are the key objectives of your organisation?

The reply I get is often – deafening silence

Clearly that’s only my experience, and it may not be yours, but I do think it’s a wise manager who periodically asks their employees;

‘What do you understand our organisations / business’ key objectives to be?’

2. Help employees to see how their performance contributes to meeting the organisations objectives

Every single person in an organisation contributes to the meeting of the organisations objectives – whether as the CEO or Office Cleaner. What employees frequently don’t understand is HOW they contribute, how their performance helps the organisation to meet its objectives

A simple approach is to get clarity on this with your employees is to use performance objectives. Here you take each of the performance objectives you a have agreed and then you explain how achievement of that objective contributes to your businesses success (or how failing to meet the objective would have a negative consequence to the business). So you simply explain how, by meeting their performance objectives, the employee is contributing to the organisation’s objectives

Here’s a simple example:

  • You have an organisational objective which is ‘to increase client retention rates’
  • You have a performance objective agreed with an administrator which is to ‘deal with customer queries within 3 days’

So you might say to your employee something like;

‘Meeting this objective is really important to the business because when queries are dealt with in this time frame we know it improves customer satisfaction. We also know improved satisfaction improves client retention which is one of our organisations key objectives’

(Read more examples in my blog ‘Helping Employees to Understand the Bigger Picture’)

Objectives and Theory Y: Summary

In short, your employees can’t be committed to organisational objectives that they don’t understand. Your employees are unlikely to be committed to manage themselves towards meeting the organisation’s objectives if they can’t see how their performance contributes to the meeting of those objectives

So clarity on what the organisations objectives are and how the employee contributes towards those objectives are key issues in making the ‘Theory Y’ management style really work

Do you want to read more about Performance Objectives?

performance objectivesWhy not take a look at my e-book ‘Motivating Your Staff with Powerful Performance Objectives’ – a step-by-step guide for managers, team leaders and supervisors who want to motivate their staff to high performance. More details HERE


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