Theory z

William G. Ouchi • An American professor and author in the

field of business management• He was a pioneer in introducing interactional

leadership theory in his application of Japanese-style management to corporate America.

• Studied the differences between Japanese and American companies and management styles

• Born 1943• Honolulu, Hawaii• He earned a B.A. from Williams College

(1965), an MBA from Stanford University (1967) and a Ph.D. in Business Administration from the University of Chicago (1972).

Development of Theory z

Has been called a sociological description of the humanistic organizations advocated by management pioneers such as Elton Mayo, Chris Argyris, Rensis Likert, and Douglas McGregor.

In the 1970s and 1980s, many United States industries lost market share to international competitors, particularly Japanese companies.

Concerns about the competitiveness of U. S. companies led some to examine Japanese management practices for clues to the success enjoyed by many of their industries. This led to many articles and books purporting to explain the success of Japanese companies.

It was in this atmosphere that Theory Z was introduced into the management lexicon.

• Theory Z: How American Management Can Meet the Japanese Challenge –

His first book in 1981 summarized his observations. It currently ranks as the seventh most widely held book of the 12 million titles held in 4000 U.S. libraries.

Differences between American and Japanese Management Practices

American Organizations Japanese Organizations

Short-term employment Lifetime employment

Individual decision making Collective decision making

Individual responsibility Collective responsibility

Rapid evaluation & promotion Slow evaluation & promotion

Explicit control mechanisms Implicit control mechanisms

Specialized career paths Non specialized career paths

Segmented concern for employee as an employee

Holistic concern for employee as a person

Characteristics of Theory ZCharacteristics of Theory Z

• consensus decision making• guarantee of lifetime employment• job security• slower promotions• quality circles• establishment of strong bonds of responsibility

between superiors and subordinates fitting employees to their jobs

• a holistic concern for the workers

THEORY Z COMPANIES

http://en.wikipedia.org/wiki/File:IBM_logo.svg

SEVEN “S”OF MANAGEMENT

HARD “S”:1.Strategy-plan of action2.Structure-the organization3.Systems-formal and informal procedures that

support the strategy and structure

SOFT “S”4. Superordinate goals-guiding concepts5. Staff-the people/human resource6. Skills-the distinctive competences 7. Style-the cultural style of the organization or

how managers achieve goals

SEVEN “S”OF MANAGEMENT

Comparison & Contrast of Theories X, Y & Z

ManagementConcept

Douglas McGregor (Theory X & Y)

William Ouchi(Theory Z)

Motivation

Either being unwilling or unmotivated to work, or being self motivated towards work. Threats and disciplinary action are thought to be used more effectively in this situation, although monetary rewards can also be a prime motivator to make Theory X workers produce more.

Believes that people are innately self motivated to not only do their work, but also are loyal towards the company, and want to make the company succeed.


ManagementConcept



Leadership

Theory X leaders would be more authoritarian, while Theory Y leaders would be more participative. But in both cases it seems that the managers would still retain a great deal of control.

Theory Z managers would have to have a great deal of trust that their workers could make sound decisions. Therefore, this type of leader is more likely to act as "coach", and let the workers make most of the decisions.


ManagementConcept



Power & Authority

As mentioned above, McGregor's managers, in both cases, would seem to keep most of the power and authority. In the case of Theory Y, the manager would take suggestions from workers, but would keep the power to implement the decision.

The manager's ability to exercise power and authority comes from the worker's trusting management to take care of them, and allow them to do their jobs. The workers have a great deal of input and weight in the decision making process.


ManagementConcept



Conflict

This type of manager might be more likely to exercise a great deal of "Power" based conflict resolution style, especially with the Theory X workers. Theory Y workers might be given the opportunity to exert "Negotiating" strategies to solve their own differences.

Conflict in the Theory Z arena would involve a great deal of discussion, collaboration, and negotiation. The workers would be the ones solving the conflicts, while the managers would play more of a "third party arbitrator" role.

“Management focused on increasing employee loyalty to the company by being concerned about the well-being of the employee, both on and off the job, offering life-long security of employment.”

“Management emphasized stable employment, high employee morale & high satisfaction as keys to high productivity.”

REFERENCES• Website: Wikipedia. http://en.wikipedia.org/wiki/Theory_Z• Website: Enotes.

http://www.enotes.com/management-encyclopedia/theory-z• Marquis, Bessie and Carol Houston. (2006) Leadership Roles and

Management Functions In Nursing Theory and Application. 6th Edition. Hongkong: Lippincott Williams and Wilkins.

• Tomey, Ann M. (2004) Guide to Nursing Management and Leadership. 7th Edition. Singapore: Mosby Inc.

THANK YOU!Have a nice

day.

Documents

Theory z