Douglas McGregor, Revisited: Managing the Human Side of the Enterprise

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"The world that Douglas McGregor spoke of is here. . . . Those businesses that thrive today are not necessarily those with the most valuable resources, the greatest market share, or the most capital (though none of these hurt); rather, those businesses that are able to tap their human potential in the most productive manner are the ones who enjoy enduring success. This is the world that Douglas McGregor envisioned."--- from Douglas McGregor, Revisited

The words of Douglas McGregor, one of the fore-fathers of management theory and one of the top business thinkers of all time, cannot and should not be ignored. McGregors vision of a more humanistic workplace may not have been widely accepted over three decades ago, but technological advancements that McGregor himself anticipated have paradoxically helped companies become more human. Viewing employees not as cogs in the machine but as living beings with individual goalswhat McGregor called "the human side of the enterprise"has proven to provide a remarkable competitive advantage.

Now, with the rise of the networked economy, the growing power of frontline workers, and the shift in power from mass producer to individual consumer, authors Gary Heil, Warren Bennis, and Deborah Stephens assert that McGregors ideas are more important and relevant than ever before.

Douglas McGregor, Revisited emphasizes McGregors lasting influence and updates his thinking with new concepts, fresh strategies, and modern implementation. This timely work traces McGregors original thinking, which has emerged in current approaches that stress distributed leadership, open-minded appraisal techniques, and employee/customer commitment.

Highlighted throughout with gems of wisdom in McGregors own words, the book describes the value of his theories for todays managers. The authors carefully outline how to put McGregors thinking into practice in your own business so you can:

• Devise a better performance management system
• Form and supervise effective management teams
• Build cooperation instead of internal competition
• Cultivate an intrinsically motivating, values-driven workplace
• Create a cause worthy of employee commitment

Also featured are examples from a host of companies and leaders who have flourished under McGregors approach. Authoritative and highly instructive, Douglas McGregor, Revisited offers new generations of managers important lessons from history and from the field.

Praise for Douglas McGregor, Revisited

"This book revisits in a contemporary manner the most important question facing management today: given what we know about human nature, how should work be managed so as to unleash the vast creative potential of human beings? The evidence is overwhelming that many people either come to an organization or can be appropriately led to exhibit the behavior McGregor characterized as Theory Y. This book provides a how-to approach for developing people at work and for establishing high performance organizations."---Joseph A. Maciariello, Horton Professor of Management
Peter F. Drucker Graduate School of Management, Claremont Graduate University and Claremont McKenna College. Author of Lasting Value: Lessons from a Century of Agility at Lincoln Electric

Douglas McGregors seminal works, The Human Side of the Enterprise and The Professional Manager, debunked Taylorism and described a revolutionary way to manage people. He was the first to apply the findings in behavioral science to the world of business. Based on what had been learned about human behavior, McGregor explored the implications of managing people in a different manner than tradition dictated.

The nature of work today makes McGregors ideas more relevant than ever before. This important book applies his thinking to todays business world, proving again that the human aspect of work is crucial to organizational effectiveness. It also suggests how you can change your thinking and implement his ideas in your own business and workplace.


Outline Review
Now that we've been downsized and outsourced and reengineered and networked, management gurus are finally focusing on the one universal resource that has been staring them in the face all along: their so-called "human capital." The funny thing is, some of the best thinking on the subject was published more than four decades ago, when few senior business people were ready to listen. In essays like "New Concepts of Management" and books like The Human Side of Enterprise, the late MIT educator Douglas McGregor argued articulately that corporations are not merely machines, nor are workers simply cogs to run them. Now, in Douglas McGregor, Revisited, Gary Heil, Warren G. Bennis, and Deborah C. Stephens resurrect many of these prescient observations and place them in a context appropriate for our times. The three prominent leadership specialists open with "Why McGregor Matters," an extensive section in which his opinions are discussed as they relate to performance, cooperation, motivation, commitment, and other topics like teams. The authors conclude with selections from McGregor's work that address issues (including the changing composition of the industrial work force, job satisfaction, and paternalism) that remain as relevant today as the day they were written. --Howard Rothman

Dr. Michael Beitler
Author of "Strategic Organizational Change"

Authors Gary Heil, Deborah Stephens and Warren Bennis assert that the nature of work today makes McGregor's ideas more important and relevant than ever before. This book revisits in a contemporary manner the most important question facing management today: given what we know about human nature, how should work be managed so as to unleash the vast creative potential of human beings? It applies McGregor's thinking to today's business world, proving again that the human aspect of work is crucial to organisational effectiveness. It also suggests how you can change your thinking and implement his ideas in your own business and workplace.

The authors carefully outline how to put McGregor's thinking into practice in your own business so you can devise a better performance management system, form and supervise effective management teams, build cooperation instead of internal competition, cultivate an intrinsically motivating, values-driven workplace and create a cause worthy of employee commitment.

Everyone was excited about the potential of his assumptions about people in the workplace: Employees want to do a good job; they will make extra effort to learn and accomplish more; they have the potential to much more; and it makes great sense to get everyone involved as much as possible. At the time, it seemed like the first breath of fresh air in the stale world of corporate bureaucracies. Although I haven't thought much about McGregor in over 20 years, I realize that I was profoundly influenced by his thinking.

Reading this fine book gave me a valuable new perspective on McGregor -- that a central weakness of many companies and managers is that the comapny's leadership is not consciously aware of what it assumes about its employees. While almost every company espouses humanistic and empowerment ideas and ideals, many continue to operate in the same old command and control way. Most of the focus is on creating carrots and sticks to manipulate behavior.

Why don't people get it? McGregor had figured out that managers don't think much about their assumptions about employees. McGregor made the important point that everyone needs to determine what those assumptions are (Can people be trusted? If yes, use Theory Y. If no, use Theory X). What happens now is that many people hold Theory X beliefs that employees cannot be trusted and but try to use Theory Y methods (that they can), and the mixed messages keep everyone confused. 'I want you to take full charge of this project, but check with me before doing anything.' Sound familiar?

In particular, managers don't really understand Maslow's hierarchy of needs. As simple needs are fulfilled, psychic needs become more important such as working on something that will make a difference. Chapters 6 and 7 are especially good on how intrinsic personal motivation is created.

This book is excellent in that it contains a retrospective perspective on McGregor as well as some of McGregor's own key essays. I especially enjoyed Warren Bennis's essay on the weaknesses in McGregor's argument: How do managers get their needs served if they are always servant leaders (see Joe Jaworski's excellent book, Synchronicity to get an answer to that) and what is the role of the environment on the needs of the worker in the workplace? Clearly, the Internet is one example of a new force that irresitibly is creating Theory Y contexts for accomplishment, independent of what managers do.

The main weakness of this book is that it does not point out that the limit to Theory Y was that McGregory did not give enough detail to make it possible to know exactly what to do. See Bill Jenson's book, Simplicity, for the significance of this mistake by McGregor.

Whether you believe that employees cannot be trusted or that they are your first line of offense and defense empowered on their own, you will benefit from reading and thinking about the questions and topics in this book. It can be an important step forward toward helping you build an irresistible growth enterprise.