Advocates of the behavioural approach to management stress that people(employees) should be the main focus of the way the business is organised. They believe that successful management depends largely on the manager's ability to understand and work with people who have a variety of diverse backgrounds, hopes, desires and expectations. The development of this humanistic approach has greatly influenced management theory and practise.
The behavioural theory of management has it's origins in the aftermath of the great depression of the 1930's. One major contributor to behavioural theories was Australian Elton Mayo(1880 - 1949). Mayo is considered the founder of industrial psychology. His revolutionary experiments, conducted at the Western Electric Hawthorne company in Chicago, showed that worker's improved output was not due to installation of better lighting in the factory but because employees felt that management was trying to do something about working conditions. The workers increased their productivity in response to what they perceived as increased attention from management. This became known as the "Hawthorne effect", which demonstrates that meeting people's social needs has a significant impact on productivity.
Another notable contributor to the behavioural management theory, is Douglas McGregor , although his contribution was not to the extent of Mayo's. Theory X and Theory Y refer to McGregor's classification of two contrasting sets of attitudes and assumptions a manager might have regarding worker's motivation and capabilities. The classification is useful because it highlights an important, though implicit, reason for the differing approaches of the classical and behavioural schools.
"Theory X" is a set of negative assumptions. According to this view people dislike work, avoid responsibility and lack ambition. They resist change, and need close supervision as well as external sources of motivation (notably pay).
