The XY Theory
Another motivation theory that may impact on human resources strategy is Douglas McGregor's XY theory first proposed in his 1960's work The human side of enterprise. It states that there are two approaches to managing people: in an authoritarian-style (theory x) and a participative-style (theory y). Theory x managers are demanding, unconcerned about staff welfare and morale, do not thank or praise employees and withhold rewards. Theory y managers, which McGregor rates as the best type, assume staff are ambitious, self-motivated, and anxious to accept more responsibility. According to Helen Murlis, a director at Hay Group, good managers can also help to boost employee motivation by learning what an individual's reward levers are. "Something good managers do intuitively and most reasonable managers learn to do is understand the reward levers for individuals [and] how they like to be given praise and recognition. Some people want quite a bit of attention and some don't want so much. A big turn off and demotivator is having a manager with the leadership style of Attila the Hun," she explains.
Case study: B & Q
At B&Q, the focus is very much on using learning and development, and performance-related pay as motivational tools. Andrew Moat, reward solutions and service manager, is aware of the theories of motivation from his university days, but doesn't design reward packages around them. "I am sure that what we do is described in some theory somewhere, but I am not aware of any particular label attached to it. "The single [most important] thing for us is managing people's careers and what we can do to make sure that people have fulfiling careers at B&Q. [The learning and development] could be anything from day-to-day feedback to organised training and coaching," he says. Employees are also assessed twice a year under a performance review system which grades people from one to four — one indicating underperformance and four representing top performance. Those who are graded at level one are not eligible for a pay increase or, if they are a manager, a bonus. Staff who receive a four get a bigger than average wage increase. Managers at this level are awarded bonuses. Despite this, Moat does not believe pay is always the best way to motivate staff. "People don't generally leave or join because of pay, they leave or join because of the opportunities they have at work," he explains.