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Rewards and recognition can fuel your employees

Many of you will recall a management class, in college or as part of a leadership or management training program, where the focus was on competing philosophical approaches to management.

Among the earliest ideas came from a 1960s psychologist, Douglas McGregor at the Massachusetts Institute of Technology, and his concepts of Theory X and Theory Y management. Some consultants today refer to similar concepts as red and green management.

They were not intended to be seen as right and wrong. One of the major X-versus-Y differences centers on how we see the success of co-workers. Is success supposed to happen or is it a result of extraordinary effort on their part?

Let’s look at the two philosophies and then consider how they might operate in today’s evolving workplace that I described in the June issue of Soundings Trade Only. 

McGregor worked with many major industrial companies. Based on his observation of workplace dynamics, he came up with the idea that managers and floor leaders tended to be Theory X-oriented or Theory Y-oriented.

Theory X people seemed to see the world of work this way: People are paid to work and should do as they are told. When they are successful, they accomplish what they are paid for. If they do not accomplish what they are paid to do, no excuses — they have failed and must be penalized. People are energized by money. The emphasis for managers is on walking about and assuring that people are on task and doing as expected.

A Theory Y person sees things differently; it’s a matter of the assumptions we make about people. The Y person seems to be aware that people work for money, but that they always want more (it’s the American way) However, the Y person believes that co-workers, associates and colleagues want far more than money for their work. They want to do well (they know they can) and they need to be told when they are doing a good job, especially an extraordinary job. Thus the need for performance appraisal, but not the traditional complex system that organizations have developed.

People need recognition, but the “hot stove” rule applies here as well as in discipline: Catch people doing something well and show your excitement at the time. Their reaction will be instantaneous: “Wow, someone really sees what I am doing and notices the quality.”

The result? Excel and be caught again. It does happen. I’ve seen it in students and client managers.

This was 50 years ago. Is there any message from McGregor that applies today? I propose that we consider at least six messages as applications of McGregor in the emerging workplace environment:

Avoid micromanagement attempts: Generation Y, also known as Millennials, (do not confuse this “Y” with theory X and Y) want to be given an assignment and allowed to do it their way. They are better trained in school than past workers and they know it. (No, they’re not actually cocky.) They are mobile and feel no loyalty to their employer. To create greater turnover, be sure to look over their shoulders and tell them exactly how the work is to be done. Many managers routinely practice micromanagement. Yes, it is very difficult to delegate the authority, as well as the responsibility, to complete a significant assignment. Managers and employees need assistance in developing trust based on skill development. The 21st century movement away from providing extensive skill training to employees and toward expecting employees to attain a level of skill via outside training has been a major cause of the reduction of trust that managers have in their employees. Employees often will have minimal trust in their leaders because of the age disparity. Younger workers often do not have high regard for “older” managers. (One study found the dividing line at 38. What would you say?) When trust is lacking, micromanagement develops, with all of its liabilities, especially for younger generations of workers.

Review the company’s current performance appraisal plan: Most business- and public-sector appraisal systems “require” managers to complete “darn awful” forms every year, all at the same time or in alternating quarters. No one likes the process. The employee normally hates it and the evaluator dreads the assessment and normally delays until the last minute. Regretfully, the formality of the process might have hindered its effectiveness. The “hot stove” rule applies here, as well as in the traditional discipline situation. When someone is effective at their work or at a particular assignment, tell them. Don’t be bashful about expressing your pleasure and excitement about their success. This simple act is far more valuable for you and the employee than any annual review.

Encourage front-line managers to develop coaching skills: Workplace leaders typically have minimal quality leadership training that they can apply to difficult leadership tasks. Managers get assigned, but their learning largely takes place on the job from some of the workers they will manage. A major skill needed is that of coach. All of us would like to hear about new ways to do our work and the coach analogy relates to quality. Workplace coaches seek higher quality by refining people’s behavior. All of us can improve if we are shown and not merely told how we might improve or change.

Allow employees the freedom to do their work as they see fit, subject only to general supervisory review: This requires that workers be properly trained so they can excel. The coaching I refer to above can then be utilized. If workplace leaders are to feel comfortable about letting go, they must believe that employees can do the job well. That trust builds over time. But the time for the trust to build seems to be getting shorter. Millennials soon become anxious about an assignment. The time for action is soon.

Enhance the instant feedback techniques of all workplace leaders: Providing on-the-spot feedback to children has been a perpetual problem for parents, and we have thousands of books written for parents. Child psychologists have made a mint and mostly repeated the same advice over and over. However, there seems to be no one authoritative prescription. In the workplace we can see some of the same counsel. Many managers have been trained through the years not to do anything that may cause employees to expect too much when it comes time for the anticipated “annual” raise. Yet that idea causes the same error we make with children. People want to know how they are doing, and they want to know on an almost-daily basis. Millennials especially need the feedback. Make sure workplace leaders are prepared to offer the appropriate feedback. They likely are not.

Consider developing a bonus system for extraordinary performance: If you subscribe to McGregor’s Theory X philosophy, you may not wish to read further. Today’s young people respond more to the “bonus concept,” discussed recently and often in the media as a partial method for reducing government budgets: Does a teacher deserve a raise in pay (a permanent increase) or a bonus (one time only)? However, just as you reward a dog with a treat or reward a child for all A’s on a report card, the younger generation expects and accepts mini-bonuses as almost routine. What are typical mini-bonuses? They include such things as free buffet lunches for team efforts, extra days off, sports tickets, concert tickets, trips for the weekend, iPads, gift cards (gasoline is big today), sports equipment, an archery set, mountain bikes and the like. The costs of these are not insignificant, but they are good investments. Some of the earlier work by motivational author Bob Nelson on rewards would be valuable reading today, probably more than when it was published 15 to 20 years ago.

What might another lesson or message be? A practicing manager who proofread this column for me came up with another message immediately. I know you can, too. I will report back to you in a later issue about the feedback I get. I hope to hear from many of you. Contact me at

Jerald F. Robinson, Ph.D., is professor emeritus, international management, at the Pamplin College of Virginia Tech in Blacksburg, Va. He can be reached at (540) 449-5870 or by e-mail:

This article originally appeared in the August 2011 issue.



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