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William Ouchi’s Theory Z of Motivation: Features and Limitations!

William Ouchi’s Theory Z of Motivation: Features and Limitations!

William Ouchi developed Theory Z after making a comparative study of Japanese and American management practices. Theory Z is an integrated model of motivation. Theory Z suggests that large complex organisations are human systems and their effectiveness depends on the quality of humanism used. A type Z organisation has three major features—trust, subtlety and intimacy.

Mutual trust between members of an organisation reduces conflict and leads to team work. Subtlety requires sensitivity towards others and yields higher productivity. Intimacy implies concern, support and disciplined unselfishness.

The distinguishing features of Theory Z are as follows:

1. Mutual Trust:

According of Ouchi, trust, integrity and openness are essential ingredients of an effective organisation. When trust and openness exist between employees, work groups, union and management, conflict is reduced to the minimum and employees cooperate fully to achieve the organisation’s objectives.

2. Strong Bond between Organisation and Employees:

Several methods can be used to establish a strong bond between the enterprise and its employees. Employees may be granted lifetime employment which leads to loyalty towards the enterprise. During adverse business conditions shareholders may forgo dividends to avoid retrenchment of workers. Promotions may be slowed down.

As against vertical movement of employees greater emphasis should be placed on horizontal movement which reduces stagnation. A career planning for employees should be done so that every employee is properly placed. This would result in a more stable and conducive work environment.

3. Employee Involvement:

Theory Z suggests that involvement of employees in related matters improves their commitment and performance. Involvement implies meaningful participation of employees in the decision-making process, particularly in matters directly affecting them. Such participation generates a sense of responsibility and increases enthusiasm in the implementation of decisions, Top managers serve as facilitators rather than decision-makers.

4. Integrated Organisation:

Under Theory Z, focus is on sharing of information and ‘ resources rather than on chart, divisions or any formal structure. An integrated organisation puts emphasis on job rotation which improves understanding about interdependence of tasks. Such understanding leads to group spirit.

5. Coordination:

The leader’s role should be to coordinate the efforts of human beings. In order to develop common culture and class feeling in the organisation, the leader must use the processes of communication, debate and analysis.

6. Informal Control System:

Organisational control system should be made informal. For this purpose emphasis should be on mutual trust and cooperation rather than on superior-subordinate relationships.

7. Human Resource Development:

Managers should develop new skills among employees. Under Theory’ Z, potential of every person is recognized and attempts are made to develop and utilise it through job enlargement, career planning, training, etc.

Thus, Theory Z is a hybird system which incorporates the strengths of American management (individual freedom, risk taking, quick decision-making, etc.) and Japanese management (job security, group decision-making, social cohesion, holistic concern for employees, etc.) systems.

Japanese companies operating in the United State have successfully used Theory Z. After collaboration between Japanese and Indian companies, some experts have suggested application of this theory in India, in Maruti Udyog, which has collaboration with Suzuki motors of Japan an attempt has been made to apply Theory Z.

The workplace has been designed on the Japanese pattern, which involves open offices. The same uniform has been introduced for all employees irrespective of their designation. Similarly, there is a common canteen for all. These practices are expected to avoid status differentials and class feeling among employees and thereby facilitate teamwork in the company.

Limitations of Theory Z:

Theory Z suffers from the following limitations:

(i) Provision of lifetime employment to employees to develop a strong bond between organisation and employees may fail to motivate employees with higher level needs. It merely provides job security and may fail to develop loyalty among employees.

An employee may leave the organisation when better employments are offered to him by some other enterprise. Moreover, complete security of job may create lethargy among many employees. Employers also do not like to retain inefficient employees permanently.

(ii) Participation of employees in the decision-making process is very difficult. Managers may dislike participation as it may hurt their ego and freedom. Employees may be reluctant to participate due to fear of criticism and lack of motivation. Even if they sit along with management they may contribute little unless they understand the issues and take initiative. Involvement of all employees may also slow down the decision-making process.

(iii) Theory Z suggests organisation without any structure. But without structure there may be chaos in the organisation as nobody will know who is responsible to whom.

(iv) It may not be possible to develop a common culture in the organisation because people differ in their attitudes, habits, languages, religions, customs, etc.

(v) Theory Z is based on Japanese management practices. These practices have been evolved from Japan’s unique culture. Therefore, the theory may not be applicable in different cultures.

Thus, Theory Z does not provide complete solution to motivational problems of all organisations operating under different types of environment. However, it is not merely a theory of motivation but a philosophy of managing.

Public Administration by G.Rajput

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