Someone in your team not quite living up to expectations? Want to do something about it? Good news – you can. Bad news – the problem inevitably starts with…. You.

Let me explain using principles established decades ago that will nevertheless create a massive shift in your team’s performance today. In 1960, MIT Sloan School of Management professor Douglas McGregor created and developed two theories of human motivation. In essence, McGregor identified two different types of manager:

• One who mostly applies ‘Theory X’

• One who mostly applies ‘Theory Y’

These theories can have a profound effect on how well, or how badly, your employees are motivated, and thus, how well or badly they perform. So what is ‘Theory X’? What is ‘Theory Y’? And how do they influence the behaviour of your employees? Let’s find out.

What are McGregor’s theories?

In his book The Human Side of Enterprise, McGregor described two radically different sets of general assumptions—two theories—that form the basis for two opposing managerial styles.

‘Theory X’

‘Theory X’ assumes that employees are lazy, untrustworthy, lacking in ideas, and only motivated by money or fear. The ‘Theory X’ manager transfers this pessimism to his management style where it manifests as a hands-on—some might say domineering—approach to getting results.

‘Theory Y’

‘Theory Y’ assumes that employees want to do a good job, are trustworthy, full of great ideas, and motivated by achievement and recognition. The ‘Theory Y’ manager transfers this optimism to his management style where it manifests as a drive to relate to the worker on a more personal level.

Both theories can have a powerful impact on the motivation of your employees. But there’s more at stake than just motivation. McGregor’s theories show us that the way we choose to manage our employees—through pessimism (‘Theory X’) or optimism (‘Theory Y’)—can actually create certain traits in our employees where none existed before.

The self-fulfilling prophecy

A self-fulfilling prophecy is any positive or negative expectation about circumstances, events, or people that may affect behaviour and cause those expectations to be fulfilled.

The Pygmalion effect

The idea of the self-fulfilling prophecy can be illustrated by an experiment from the 1960s conducted by Robert Rosenthal and Lenore Jacobson . In the experiment, a teacher was given the names of five students that had been identified as “intellectual bloomers.” This meant that those five students would do better than expected in comparison to their classmates. At the end of the study, those five students showed significant statistical gains when compared to their classmates.

Rosenthal and Jacobson concluded that teacher expectations influenced student achievement. The teacher believed that the five “intellectual bloomers” would excel and her resultant behaviour—how she treated them compared to how she treated the other students—made it so. This type of positive self-fulfilling prophecy became known as the Pygmalion effect.

But for every positive there has to be a negative. In the case of the self-fulfilling prophecy, this negative became known as the Golem effect.

The Golem effect

In 1971, Stanford psychology professor Philip Zimbardo conducted an experiment (infamously known as the Stanford Prison Experiment ) to test the hypothesis that inherent personality traits of prisoners and guards are the primary cause of abusive behaviour in prison.

Twenty-four males were selected based on their psychological stability and health. Twelve of the participants were randomly assigned to be guards while the other twelve were assigned to be prisoners. Conditions within the “prison” quickly deteriorated as both guards and prisoners internalised and exhibited (to an alarming degree) the roles that had been assigned to them. Though the experiment was intended to last two weeks, it was cut short after only six days.

Zimbardo concluded that situational attribution of behaviour (external characteristics) rather than dispositional attribution of behaviour (internal characteristics) caused each group to act as they did. Because the guards expected the prisoners to behave in a certain way, they treated them with those expectations in mind. And because of the guard’s actions, the prisoners acted accordingly.

The lesson for managers

How you view your employees and behave toward them has a profound effect on how they perform. You can choose to be a ‘Theory X’ manager and view your employees as lazy, untrustworthy, lacking in ideas, and only motivated by money or fear. Or you can choose to be a ‘Theory Y’ manager and view your employees as ready to work, trustworthy, full of great ideas, and motivated by achievement and recognition. Either way, chances are your employees will become what you expect them to be whether they started that way or not. Either way, your management style creates a self-fulfilling prophecy.

So if you have someone on your team who you see through the lens of ‘Theory X’, whose fault is it? As managers, we can make incorrect assumptions and easily wind up ‘X-ing’ people out. Whether we mean to or not, every time we treat someone as though ‘Theory X’ is true, that’s what we ultimately create: lazy, untrustworthy, uncreative employees who are only motivated by money or fear. It may not happen right away, but it will happen.

So take a moment to examine your management style and the way you view your employees. Are you operating under ‘Theory X’ which has the tendency to create a Golem-like self-fulfilling prophecy? Or are you operating under ‘Theory Y’ which has the tendency to create a Pygmalion-like self-fulfilling prophecy?

Maybe it’s time to shift your assumptions and rethink the way you manage your team.


Peter Anderton

Author: Peter Anderton

A sought after coach and change agent, Peter has spent many years in Organisational Development, focusing on developing high performance leadership teams, executive coaching, strategy and change. He builds relationships quickly and is as comfortable in the boardroom as he is at ‘grass roots’. Known for his integrity, energy and a real passion for making things happen, he has a uniquely direct yet supportive style that delivers.

Peter is a qualified NLP master practitioner, a Chartered Fellow of the CIPD and a Chartered Engineer.