Theory X and Theory Y have to do with the perceptions managers hold on their employees, not the way they generally behave.

McGregor had identified theory X and theory Y differently for the basic characteristics stated previously in the above sections of what these theories represent.

He identifies two extreme sets of assumptions (Theory X and Theory Y) and explores how management style differs according to which set of assumptions is adopted.

Theory X and Theory Y were both written by Douglas McGregor, a social psychologist who is believed to be a key element in the area of management theory.

Theory X and Theory Y relate to Maslow's hierarchy of needs in how human behavior and motivation are main priorities in the workplace in order to maximize output.

It was during this time that their supposedly combined efforts produced the grid as a method of finding a median between McGregor's Theory X and Theory Y workers (Capstone, 2003).

In the book The Human Side of Enterprise, McGregor identified an approach of creating an environment within which employees are motivated via authoritative, direction and control or integration and self-control, which he called theory X and theory Y, respectively.

Graham Cleverley in Managers & Magic (Longman's, 1971) comments: "...he coined the two terms Theory X and theory Y and used them to label two sets of beliefs a manager might hold about the origins of human behaviour.

At higher levels of the hierarchy, praise, respect, recognition, empowerment and a sense of belonging are far more powerful motivators than money, as both Abraham Maslow's theory of motivation and Douglas McGregor's theory X and theory Y (pertaining to the theory of leadership) demonstrate.

Theory X and Theory Y are theories of human motivation created and developed by Douglas McGregor at the MIT Sloan School of Management in the 1960s that have been used in human resource management, organizational behavior, organizational communication and organizational development.