An important element of a management philosophy is the way that management looks upon employees. It is reasonable to assume that where one is located on the scale between McGregor’s Theory X and Y plays a significant role in how management systems are designed. According to Theory X, people exhibit an instinctive reluctance to work and must subsequently be forced, monitored and controlled in order to carry out the task at hand. The perception is that people prefer to be controlled and seek to avoid taking responsibility. According to Theory Y, on the other hand, work comes as naturally to people as rest, and they can control their own work in relation to objectives that they find important. Under favorable conditions, people seek responsibility and have a vast ability to invent and create things independently.
Some time ago one of us studied a number of companies which had implemented flexible work flow philosophies. They argued that workers preferred to keep their old and boring, but also simple and safe, tasks. The only way to make them take more responsibility was to force or trick them into new roles, which is entirely in line with Theory X.
Atlas Copco Tools in Tierp, Sweden
The only exception was Atlas Copco Tools’ manufacturing plant in Tierp, Sweden. In the plant they successfully decentralized its decision-making process and transferred more qualified tasks to employees on the floor as the firm introduced a more flexible work flow. A source of inspiration for this was that top management had noticed that the employees frequently performed highly qualified tasks in their leisure time (e.g., in the form of volunteer positions in sports associations, political parties or the union). The thinking behind this, very much in line with Theory Y, was that “if they can carry out qualified tasks in their leisure time, there is no reason why they can only perform simple tasks at work”. This led management to conclude that the organization was actually restraining the abilities of its employees.
Do we need to say that the firm applying Theory Y was clearly the most successful in its implementation, with drastically cut lead times, much less capital tied up in stock, increased delivery efficiency and exceptionally satisfied employees?
You can read more about this very interesting case in our book The Agile Company - Beyond Project Management!