What is Theory Z of motivation?

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Discuss Theory Z of motivation

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Lyndall F. Urwick has proposed this theory according to which primary task of every manager is to make or distribute goods or services at prices which the consumers are able and willing to pay and it is to this end he must direct the efforts of those associated with him. The people would be ready to direct their behaviour towards organisation goals under two conditions: (i) each individual should know the organisation goals precisely and the contributions which his attempts are making towards these; and (ii) each individual should be confident that the realisation of organisational goals is going to affect his needs satisfaction positively, and that none of his needs is threatened or frustrated by the membership of the organisation. Management action consistent with these will motivate employees. Urwick contents that behaviour is better reflected by a new theory Z rather than by X or Y. No doubt, this is true, but this is not a new contribution.
It can be made clear that Z does not stand for anything, it is merely the last letter of the alphabet. Perhaps the various authors have used it just to describe a state of affairs in the organisation and human behaviour as has been done in the case of theories X and Y. Further, therory Z is not a theory—it is a label interchangeable with type Z. Just for labelling purposes, type Z was perfectly all right. The redundant expression theory Z was adopted not for analytical or descriptive purposes but for promotional purposes. Ouchi's theory Z captures the best in management methods from U.S. and Japanese approaches. There are four postulates of theory Z. These are: strong bond between organisation and its employee’s involvement, no formal organisation structure, and role of leader lo bring coordination in human beings rather than in technical factors.
1. Strong Bond Between Organisation and Employees—Theory Z suggests strong bond between organisation and its employees. Ouchi has suggested certain methods for this, including the lifetime employment in the organisation as being followed by Japanese organisations. This stability must be achieved through the provisions of highly conducive work environment and challenges and participation in decisions. When there is a situation of layoff, it should not be resorted to and shareholders and owners can share the resultant loss by accepting less profits or even moderate losses for a short period of time. Another factor necessary for stability of employment is the slowing down of evaluation and promotion which brings saturation in employees' prospects very soon. As against vertical movement of employees, more emphasis should be placed on horizontal movement which reduces stagnation. A career planning for employees should be prepared so that every employee is suitably placed. Slowing down of promotion and financial incentives can be made up by non-financial forms of evaluation such as frequent involvement with superiors or projects. They communicate the expectation of greater income in the future without creating short-term incentives.
2. Employee Involvement—Employee involvement is the important factor in theory Z. The involvement comes through meaningful participation. However, it does not mean that employees' participation is necessary in all decisions. In fact, there can be some decisions which are taken without consulting employees but they are informed later. There can be some decisions where employees' suggestions are taken but the final decisions are taken by management. In the case of remaining decisions, the process should be a joint one. However, any decision affecting employees in any way should be taken jointly and if there is any decision which the management wants to take individually, the employees should be informed about this so that they do not feel ignored. The idea is not to slow down the decision-making process but to involve employees for their commitment and giving due recognition to them.
3. No Formal Organisation Structure—Theory Z supposes no formal structure for the organisation. Instead, it must be a perfect teamwork with cooperation along with sharing of information, resources and plans. Ouchi has given the example of a basketball team which plays well together and solves all problems with no formal reporting relationships and minimum of specialisation of positions and of tasks. An organisation does have any chart, division or any visible structure.
4. Coordination of Human Beings-To productivity a leader has to coordinate the people and not the technology. This involves developing people's skills and also the creation of new structures, incentives and a new philosophy of management. The purpose is to achieve commitment of employees lo the development of a more cooperative approach to work. The leader must develop trust which consists of the understanding of fundamentally compatible goals of the desire for the more effective working relationship together.
Thus, theory Z provides a complete transformation of motivational aspect of employees which other theories are not able to emphasise. However, following features may work against the precepts of theory Z.
(1) The provision of life time employment to develop strong bond between the organisation and its employees seems to be difficult because the employer will not retain an unproductive employee.
(2) Theory Z emphasises on common culture and class feeling within the organisation. This is also very difficult because people come from a wide variety of environments. People differ in habits, eating pattern, dress and languages, caste system etc.
(3) The preposition that shareholders will accept less profit or accept losses to avoid lay off does not seem to be feasible.
(4) There are some operational problems in implementing Theory Z.
To sum up, Theory Z does not present the total solution of motivational problems.