Theory X and Theory Y management
en.wikipedia.orgTheory Z: The prime motivation for every single employee in every single organization is improving their own local working and living conditions. Whether that materializes as X or Y behavior is a question of how well management can align the employee's self-interest with the organization's interest.
Aligning incentives is harder in some jobs/industries than others, so for the hard ones, behavior would tend toward X, and for easier ones, behavior would tend toward Y.
Was rereading some stuff about european manorialism (feudal economic model) and a line really stuck out to me. Something like "left to their own determination farmers will optimize for resilience, not surplus production." But surplus production is the resource extracted and used by landowning elites to support their lifestyles. So a lot of the mechanics of that system emerged out of the need to coerce farmers into producing surplus against their own interests. And yes to some extent surplus and resilience are interrelated; but not really if the surplus is going to someone else.
Anyway the words and the details have changed but the fundamental relationship is still the same, and I think fits what you're describing as well. Left alone a worker would optimize for a safer or less stressful environment, or a shorter workday, over surplus production. But that surplus remains the resource that supports the lifestyle of people higher up in the hierarchy. You can only align these interests so far and they will never perfectly match.
Reminds me of in pre/early revolutionary France, the common/poor fought so hard against allowing for free trade and free pricing on bread, in favor of the existing price controls that had them massively overpaying most of the time and spending the majority of their earnings on bread alone, even in years of plenty.
Do you have any pointers to that story? (I'm French with interest in history and have not heard of it before son I'd like to know more about it!)
Just-price economics and its consequences…
Sounds to me you just described every overworked family. In buying the lie that constant consumption/fashion is the path to happiness. The landowning elites in your model are still doing the same thing. Coercion is still happening, yeah it's not by physically violent means but psychological and societal peer pressure.
An non-brainwashed family would probably work less if they realized that they can optimize for resilience and regain their freedom.
Good luck turning off the media.
Then add the foundational component called debt(financial,other types) to these relationships and you really have a match for your model.
The most expensive things for many, many, many individuals and families is not consumption or fashion but shelter and healthcare.
But if we're talking upper-middle-class-and-higher where we can assume they have decent options for that into retirement... I don't think there's nearly as much that really moves the needle enough to let them work a lot less short of "move to places in much lower demand"? Like "retire 10 years earlier and then go somewhere dirt cheap" seems about the only option, unless it's a larger societal change so the jobs move with the people to the dirt-cheap places, like what happened with the move to the Sun Belt in the US in the latter half of the 20th century but which isn't happening now in the US.
Maybe remote work will stick for enough people that that can happen again, but I don't see great signs of decentralization yet...
Would love to know more about this if you've found any related literature of how this relates to our modern society.
I know aligning incentives is usually something that falls under the broad category of "management" or people skills in a company, but there's a subfield of economics that studies exactly how to do this in a structured way (https://en.wikipedia.org/wiki/Mechanism_design). It's usually applied to things like auctions, but I've always thought applying incentive alignment in a systematic way (in which, for instance, middle management submits "bids" for metrics that they want to track and for headcount) could be a viable way to run things. Any thoughts on something like this?
Whoa, I’ve never come across Mechanism Design specifically, though I did dabble in some research (and application in pharmaceutical R&D software) of market/auction design. I found that stuff to be profoundly useful, so I’ll definitely dive into mechanism design.
Have you found any particularly good resources/books on this?
FWIW I loved Alvin Roth’s “Who gets what and why” which is about market design mostly.
Sorry for the late reply. I've never heard of the Al Roth book, but seems interesting. I'll check it out. I mostly became familiar with Mechanism Design when I took the first year microeconomics sequence in graduate school (basically one of the few departments this stuff is covered academically is in Economics). So my best reference that I can vouch for is, unfortunately, probably this: https://global.oup.com/ushe/product/microeconomic-theory-978...
There's also Matthew Jackson's book which might be better. I've read his class notes for other topics and I think he does a good job explaining: https://web.stanford.edu/~jacksonm/mechtheo.pdf
> Theory Z: The prime motivation for every single employee in every single organization is improving their own local working and living conditions.
That's the thesis of Culture of Narcissism (1979) by Christoper Lasch.
Interesting! By the title it seems a little more negative-valence than what I intended, but I will have to check that out. I appreciate the pointer!
Yeah, absolutely
E.g. doordash drivers are clearly X, and engineering teams are usually Y
All behaviour (management or individuals) is determined by goals and objectives.
I don't think anyone in management turns up thinking I want to create the most toxic work environment and work only with folks who are not good at anything or need the whip. Even the best intrinsically motivated people need an environment and challenge to rise to the occasion of doing their best work. Sometimes it's peer competition, at other times it's unreasonable deadlines.
On an individual level our desires and goals are fairly mimetic. Our motivation to do work is a function of our desires, goals and the difficulty level of the problem. A bunch of the observations around theory x/theory y doesn't account for what individual motivation is and how is it derived.
A lot of this literature stems from older generational simpler classification models around how to influence human motivation. In classical Indian literature, a famous Indian philosopher Chanakya talks about Saam, Daam, Dand, Bhed to get things done. Translated it means - persuasion, price, penalty and coercion to get things done.
While philosophically we can lean in on similar models applied to management - the key here is a lot of these theoretical models need evolution to really apply to individuals and situations.
> the key here is a lot of these theoretical models need evolution to really apply to individuals and situations.
Yes, I think the mistake some people make when seeing there are multiple possible frameworks for something that has to do with human behavior is that instead testing and seeing which model fits and works best to explain the existing system, they apply their own biases as to what they want to work or how they assume people work and then try to alter the existing system to match the model rather than alter the model to match how the system is actually working.
We use models because they're easier to reason about and use as approximations, not because they're necessarily 100% correct. When they fit well they allow us to come close to the correct answer quickly most the time. Theory X and theory Y are never going to match a work environment perfectly, and even if it appears one matches well at one point based on the people and type of work being done, there's not guarantee is can't shift to the other over time either through concerted effort or through myriad small changes in the work done or the workforce doing it.
Anyone in management should not only try to determine how the people the manage function and respond both individually and as a group, but continually check their knowledge against reality for change. I've seen workplaces change from fairly happy to extremely unhappy and toxic over time, and while sometimes it seemed like outside factors had an effect (budget and how well the company was doing), other times it felt quite a bit like the management was just completely oblivious to how people felt and how their decisions affected people. I find that people are fairly understanding of the former, and can forgive some or all of it when the problem is gone, but they're much less forgiving of the latter since it destroys trust.
Theory a-little-before-Y: Workers will do what they are familiar with. They really want to be a Theory Y worker, but they don't know how. They need close supervision and fast feedback (positive and negative). However, these are not motivators for getting work done, but guardrails against human frailty.
Something like software development transcends Theory X & Y because nobody quite knows what the job is and therefore motivation is not the main factor in whether something happens.
> Something like software development transcends Theory X & Y because nobody quite knows what the job is and therefore motivation is not the main factor in whether something happens.
Wait, what?
I have the polar opposite conclusion: that in software the outcomes are so difficult to measure that motivation is the primary reason why something happens, as lack of visibility of outcomes makes it very difficult for management to impose a traditional rewards based system to manage behaviors.
And yet, there they are… clueless… pushing down traditional management practices that incentivize the exact opposite of what they "say" they want: collaboration. Unfortunately. * sigh *
For a lot of management, "collaboration" means, "You do what I want and you get paid for it." And not, "We'll work together to figure out how to make this work for both of us."
https://www.amazon.com/First-Break-All-Rules-Differently/dp/... is a great book on how effective managers actually take their employee's strengths and weaknesses into account, and lean on their employee's strengths. (Trying to fix them is probably a lost cause.)
Modern coaching and performance management have moved heavily to strength-focused approaches for exactly that reason. Hell, over 20 years ago I was introduced to StrengthsFinder, which is built on exactly that model.
The real problem is most of the managers I've worked along side either don't want to/like to/care to coach, or were never taught how to do it well, having come out of an IC background where they, too, probably never experienced effect performance management. And, ironically, they often get moved into management not based on their natural strength as a coach/manager/mentor, but rather based on their strength as an IC (because, again, their own management likely doesn't understand how to take a strengths based approach to identifying and elevating potential leadership candidates).
Exactly right.
The book I recommended made the recommendation that a move to management always come with a pay cut, and most managers should have someone reporting to them who makes more than they do. I consider both recommendations to be excellent ideas. People should go into management because they think that they are suited to it, and not because it somehow seems like the next step in their natural career progression.
Funny story. Ian Siegal, founder and CEO of ZipRecruiter, first went into management because the programming team told the CEO at CitySearch, "Hey, this junior HTML guy is good with people, we'd rather report to him than the dufuses that you keep hiring as CTO."
Turns out that he was good with people, and was a good manager.
Personally, every time I see somebody say "collaboration" on the context of management, it means "you individual contributors go and work with each other". I have never seen it used in terms of collaboration with managers.
Then you're lucky. I've definitely seen the phrase weaponized. A lot.
Random thoughts.
Theory X is very convenient for those in charge. No need to think hard - just pull out the whip.
In my experience it takes very little application of Theory X to create enough resentment (even if hidden) to make highly creative work impossible. If you want people to do creative work, Theory Y is your best approach.
Those with executive function challenges like ADHD gain increased executive function if doing what they should is also pleasurable. It takes a long time to recondition such people to this, but Theory Y does so. That said, in the short term Theory X may work better. But the long term matters more.
Some of the best advice that I know for moving an organization towards Theory Y is in Tribal Leadership, https://www.amazon.com/Tribal-Leadership-Leveraging-Thriving....
Man, Baader-Meinhof is real--this topic keeps popping up for me lately.
In the modern day you might see these styles described as command-and-control versus servant leadership:
https://www.mckinsey.com/featured-insights/mckinsey-explaine...
(don't be put off by the source, it's actually a decent piece)
As I understand it C2 (command and control) is technically separate, and traditionally resembles Theory X , though current thinking seems to have aspirations towards Theory Y for various roles and scenarios in Mission Command.
Indeed it is. I just looked "Baader-Meinhof" up a week ago...and here it is in your comment again!
https://twitter.com/dvsj_in/status/1674481301880213504?t=4t3...
Douglas McGregor, the creator of these theories, had an interesting biography.
> He chose instead to pursue a psychology degree at what is now Wayne State University in Detroit. After two years, he married, dropped out of college, and worked as a gas station attendant in Buffalo, New York. By 1930 he had risen to the rank of regional gas station manager.
> McGregor decided to resume his studies while also working part-time. He completed a B.A. in 1932 from Wayne State University.
> Soon after graduation, he entered Harvard University where he studied for three years, earning an M.A. and Ph.D. in psychology.
Minor observation here (sort of non-tech-related): any of these strategies is doomed to failure (if success means “producing a product or service that’s excellent) if your workers can plainly see that there’s no future where they could support a family working at this company. Retail is the prime example of this: Retail sales used to be a decent career choice and someone good at selling and customer service could expect to be able to enjoy a middle class lifestyle with things like vacations and a good home and car. And stores featured helpful salespeople who knew their merchandise and could genuinely help you make your decisions. Now in90% off chains, it’s obvious that there are maybe a tiny handful of positions at corporate that fit this description, but the chances are about 99% that this won’t be available to you. So retail employees are incentivized to do the absolute minimum until they get fed up, quit and repeat – because why would they work harder to be excellent? To earn a pin on their name tag or something? Maybe a 50¢ raise?
You can apply this to tech workers too but probably on the next income ladder step: if I know I’ll never stand a chance of serious wealth creation because I have zero equity, remind me why I’m supposed to ignore my family all evening to meet some “KPI”?
It's fun to think about how this relates to the I'm ok, you're ok quadrants:
( https://en.wikipedia.org/wiki/I%27m_OK_%E2%80%93_You%27re_OK )
The phrase I'm OK, You're OK is one of four "life positions" that each of us may take. The four positions are:
I'm Not OK, You're OK
I'm Not OK, You're Not OK
I'm OK, You're Not OK
I'm OK, You're OK
I've noticed a trend towards needless bijections in management vocabulary. Like, there will be some common names "foo" and "bar" for things, but then management will start to call them "red" and "blue" -- because that's what Important Guy said at the meeting. And anyone who has to ask what "red" and "blue" mean reveals themselves to be more-distant from Important Person. This little game propagates through the organization, resulting in various forms of confusion and misunderstanding as it goes.
Put another way -- without thinking about it, people's instinct to imitate superiors creates a collection of simple substitution ciphers. And these ciphers continually mutate, as those powerful people emit more randomness.
It's a lot like "Hail Vectron" from That Mitchell and Webb Look, except it has the structure of a bijection mapping meaningful words to arbitrary ones.
For another example, see how Davos people talk about "Blue Hydrogen", and other hues of the colorless gas.
I am sure you can think of examples from your own workplace.
Anyway, this "Theory X" and "Theory Y" stuff clearly appeals to the same impulse. What are "X" and "Y"? If you don't know, it's your turn to be shamed! Join the mystery cult!
I'm being a little too cynical. The other reason these empty signifiers pop up is that good names are hard to coin. Words carry connotations that you may not want. It's sometimes easier to start with an abstract symbol and populate it with meaning over the course of an entire paragraph.
But that's never the best thing. You do that only because you couldn't come up with a better name.
Some decent words here would be "extrinsic"(=X) and "intrinsic"(=Y), with both adjectives implicitly modifying the noun "reward" or "motivation".
For me its a mix. I've worked at startup that are built apon the core idea of they Y because the CEO did t like there stiff working environment of there last job. Reality is though your hardest workers do great under theory Y. However, most people need theory X or they will just squat and take advantage of the lax atmosphere.
The Wikipedia article actually touches on this:
> For McGregor, Theory X and Theory Y are not opposite ends of the same continuum, but rather two different continua in themselves. In order to achieve the most efficient production, a combination of both theories may be appropriate.
This matches my own experiences in that I tend to default to Theory Y but will flex into Theory X depending on the circumstances.
I just finished reading Robert Townsend's book "Up the Organization: How to Stop the Corporation from Stifling People and Strangling Profits"
https://www.amazon.com/gp/product/B004IK9U1S
He falls into the Theory Y camp, which I know as Servant Leadership. It's considered a classic management book, and I can see why. He really was a radical. When you read it (and you should), remember that it's a product of it's time and allow for the language.
Management Theory Null: All management is fundamentally parasitic and only exists to perpetuate the organizational structure designed to extract as much wealth as possible from both the Actual Contributors (preferred over "Individual Contributors") and the investors, into the pockets of management. Climbing the org chart means having more opportunity to bleed the company dry for one's own benefit. Understanding modern capitalism requires realizing that corporations aren't really profit-seeking entities trying to maximize revenue and minimize costs, but rather the livestock upon which the Business Caste tries to sate their insatiable hunger. Sometimes the parasites are so brazen as to kill the company they're feasting on (at which point they all call up their buddies and get jobs at their next host), and sometimes they're conservative enough to keep the beast alive while continually harvesting from it.
I don't believe that the next great leap in human rights will come from more unions and worker's rights (although those are important right-now steps too). I believe it will come from democratizing ownership -- giving everyone their own piece of the pie that they can cultivate. One way to do that is to use AI and automation to replace not the low-level workers, but the towering edifice of bullshit management jobs. Can we get automation and AI to the point where everyone can use it to enjoy self-proprietorship of whatever their labor is? Can we extend the "gig economy" so far that every tradesman out there is running his own company, with almost all the meta-work of running the company outsourced to an AI? Not centralized like Uber, but decentralized; democratized? That (plus a healthy dose of basic income) feels like the only escape from this hellscape of cancerous capitalism where the Business Caste who already own everything just continue to feast upon the blood of workers and investors alike in a global Tragedy of the Commons until nothing is left but the fetid husks of once-productive corporations.