Z theory of Motivation or “Theory of Ouchi”

Z Theory of Motivation

Z Theory of Motivation or Theory of Ouchi

Theory Z was propounded by William Ouchi, an American Researcher on Japanese Industrial Economic Development. He made a comparative study of Japanese and American management styles.

Theory ‘Z’ is based on the philosophy of participative management. It regards a business organization as a ‘human system. As such the success of an organization depends upon the quality of management’s attitude and behaviour towards the human resource (employees) employed. According to Theory ‘Z’ management aims at structuring the organization around powerful bonding attachment between workers and their firms, where everyone from top to bottom plays one’s part in an integrative unity of business and in the range of planned growth of the organization. The theory believes in the philosophy of management that is truly democratic and dynamic, where decisions big or small, are arrived at with the consent of all those concerned where employees loyalty is as strong and mutual as in a family. As one belongs to a family, once for all so does an employee belongs to an organization once for all.

Characteristics of Theory Z

Theory Z is based on bonding attachment, employee participation, trust, integrity and openness. These are the pillars on which the foundation of an organization stands. Important characteristics of the theory are:

1. Bonding attachment-

   The most important characteristics of theory Z is the bonding attachment. Just as a family remains united due to a common thread attachment similarly organization will remain intact due to attachment of its employees. This bond of attachment unites and directs them to achieve the organization’s objectives. It is done through job security by providing whole life employment. Bonded attachment reduces conflict and helps in receiving whole-hearted co-operation of the employees.

2. Employees participation-

   Theory Z is based on the philosophy of employees participation. Employees are treated as partners in industry. Decisions are made in consultation with employees. Consequently, their whole-hearted co-operation is automatically forthcoming.

Moreover, in case the objectives are not achieved the employees will not complain that the management set the target too high to be achieved as they themselves were a party to the setting of objectives.

3. Mutual trust-

   Theory advocates mutual trust between employees and management. Even in India our great leader Mahatma Gandhi long back (about a century) in 1920 advocated and practiced the concept of Trusteeship” in industry at Ahmadabad. Even the Royal Commission on Lab our had to admit in its Report “at Ahmadabad; there is greater co-operation between lab our and management than is visible elsewhere”.

Mutual trust reduces conflict between labour and management and encourages whole-hearted co-operation of labour.

4. Transparency:

   Transparency means maintaining clean record on the part of management and labour.

Both of them should be honest to win the confidence of each other. They should place all their cards before each other at the time of collective bargaining and such issues of common interests.

5. Informal Organization-

   Theory Z focuses its attention on informal organization rather than on formal organization. An informal organization lays emphasis on information sharing rather than on formal authority structure, divisions or charts. Leaders play a greater role than the managers. It encourages workers to cooperate and also reduces conflict between labour and management.

6. Human Resource Development-

   Last but not the least, theory Z lays emphasis on development of human resource. Every employee is given an opportunity to realize and develop his potential. It is done through job enrichment; job enlargement and training programmes Employees are rotated from one job to another so that they acquire wide and varied experience to handle all types of jobs and situations.

Critical Appraisal

Theory Z has so many advantages to its credit. However, it is not without limitations. It suffers from the following.

1. Breeds inefficiency-

   Theory Z lays too much emphasis on bonded attachment by providing job security through life time employment. Employees become inefficient as they are not afraid of loosing their job. It may also fail to motivate the employees to achieve higher production and productivity.

2. Lack of mutual trust-

   Theory Z lays emphasis on mutual trust. In real life situation there is always an atmosphere of distrust. Hence, the success of theory Z is doubtful particularly under Indian conditions where the industrial relations are at the lowest ebb (level).

3. Lack of participative management-

   Theory Z assumes the existence of participative management. However, there is lack of participative management. Party management is not willing to share its authority and partly workers are not able to participate due to a number of reasons. For example, workers may not be competent to participate or they may be afraid of criticism or there may be a lack of initiative and so on.

4. Lack of Co-ordination-

   It is a corollary of the previous point. In an informal organization co-ordination will be difficult, if not impossible. Due to lack of clear cut authority, it will be next to impossible to fix responsibility. It is well known that everybody’s responsibility as nobody’s responsibility.

Important links

• Motivation : Definition, Characteristics, Objectives
• Goal Setting Theory of Motivation- Principles, Features, Merits & Demerits
• Maslow’s Hierarchy of Needs Theory & Its Criticism
• Reinforcement Theory of Motivation & its Implications
• Theory X and Theory Y of Motivation & its Implications
• Equity Theory of Motivation
• Authority- Meaning, Sources, Characteristics, Limitation etc.
• Responsibility- Meaning, Concept, Types
• Direction in Business- Features, Importance, Principles, Technique

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