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Continuing the emphasis on factors that stimulate job satisfaction and what motivates people to be involved and contribute productively at work, McGregor capitalized on his experience as a psychologist and university president to develop Theory X and Theory Y (McGregor, 1960). Theory X and Theory Y identify two different views of how to motivate or influence others based on underlying attitudes about human nature. Each view reflects different attitudes about the nature of humans. Theory X identifies how, in bureaucratic organizations, employees prefer security, direction, and minimal responsibility. Coercion, threats, or punishment are necessary because people do not like the work to be done. These employees are not able to offer creative solutions to help the organizations advance.

The assumptions of Theory Y are that, in the context of the right conditions, people enjoy their work; can show self‐control and discipline; are able to contribute creatively; and are motivated by ties to the group, the organization, and the work itself. In essence, this view espouses the belief that people are intrinsically motivated by their work. Theory Y was a guide for managers to take advantage of the potential of each person, which McGregor thought was being only partially utilized, and to provide support and encouragement to employees to do good work (McGregor, 1960).