[INTRODUCTORY NOTES ON MOTIVATION AND PRODUCTIVITY]

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP84-00780R005000020039-5
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 41
• Document Creation Date: December 14, 2016
• Document Release Date: April 8, 2003
• Sequence Number: 39
• Content Type: NOTES

Approved For ReleaseQa03/05/27: CIA-RDP84-00780R005000W0039-5
Several years ago the Support School purchased the film series,
"Motivation and Productivity, " created by Dr. Saul W. Gellerman, These
films feature a number of well-known behavioral scientists discussing some
of the findings of research into the relationship between motivation and pro-
ductivity, and exploring some of the more intriguing current theories. The
series has been used in our management training courses and has been
shown, in whole or in part, to other audiences in the Agency.
We recently purchased Dr. Gellerman's new film series, "The Ef-
fective Organization, " dealing with the ways in which several corporations
(AT&T, Texas Instruments, and TRW among them) have applied some of the
ideas of the behavioral scientists. We think that both sets of films are ex-
cellent for stimulating thought and encouraging experimentation in the interest
of improving organizational effectiveness and employee satisfaction.
On 28 March you will see two films. "Motivation in Perspective" is
the summary film of the "Motivation and Productivity" series, and "Assessing
Management Potential" is the first film in the "Effective Organization" series.
Other films will be shown on later dates.
In this folder you will find summaries of the films in both series and
brief biographies of the people you will see on film. We hope that this
material will serve to refresh your memory and provide a common point
of reference for all.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For RJ1C6se 2003/05/27 : CIA-RDP84-00780RQ400020039-5
Background Information on Gellerman Series:
"MOTIVATION AND 'PRODUCTIVITY"
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For4pdease 2003/05/27 : CIA-RDP84-00780RW5000020039-5
THE GELLERMAN MOTIVATION AND PRODUCTIVITY
k ILM SERIES
INTRODUCTION
Ever since the famous Hawthorne Studies at the Western Electric
Company in the late 20's and early 30's, many managers have had an
uneasy feeling that there may be things that the behavioral scientists
are discovering. which they ought to know about. But these findings
upset many cherished and traditional methods of management, and
myths about how people behave in organizations. Besides, it has
been relatively easy for managers to ignore the things that behavioral
scientists are saying, because American business enterprise has
enjoyed tremendous success. We are the envy of the rest of the world,
and "you can't quarrel with success".
Lately, however, there has been renewed interest in human
motivation and behavior in organizations, simply because, we seem to have
come almost to the outer limits of offering more money, fringe benefits,
security and other things which have traditionally been considered
motivators ; There is a growing interest on the part of management
as to whether there are principles and techniques which behavioral
science has discovered which can be applied to increase productivity
and profit in an organization.
Behavioral science--which comprises psychology, sociology,
anthropology and many of the specialized branches of these disciplines,
including social psychology, industrial anthropology, etc. etc. - -has
been moving in two directions in the last few decades. One direction
involves research on the types of management behavior which seems
to lead to more productive and more profitable operation. If behavioral
science can identify some of the techniques being used by successful
managers (and if these techniques seem to be rather different than
traditional management techniques) they warrant serious consideration
by all managers to see whether or not these techniques should be
applied in their own organizations.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For ReMase 2003/05/27: CIA-.RDP84-00780R0 000020039-5
The other direction in which behavioral science is moving involves
experiments to see whether the application of the findings from the more
successful managers can be applied in different situations, different
settings, and different industries and occupations.
What are the behavioral scientists saying to management? The
common thread that runs through all behavioral science reports seems
to be this: You are not using employees at their full capacity. You've
designed jobs to take advantage of only the minimum performance
human beings are capable of. You're appealing to basic needs to
motivate employees, rather than higher human psychological needs.
The result is that management finds itself in a position of having
to give more and more in the way of economic incentives to accomplish
less and less in terms of productivity. So we hear that employees are
lazy, they always want more, "they're disloyal", they cannot be
motivated. This judgment is based on subordinates' behavior, and in
many cases, it is probably correct.
But behavioral science says that people behave this way in
organizations because that's the way they're expected to behave, that's
the wad jobs are designed, that's the way policies, procedures and
traditions have taught both managers and subordinates how to behave.
Is it, after all, so surprising to learn that subordinates, even
rank-and-file employees, want challenging, rewarding, meaningful assign-
ments ? Isn't that the way you are motivated?
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For. Re1L'Sse 2003/05/27 : CIA-RDP84-00780R0Q, p00020039-5
MOTIVATION TIIROUGH JOB ENRICHMENT
FREDERICK HER ZBERG: BIOGRAPHY
Frederick Herzberg is Professor of Psychology at Case Western
Reserve University in Cleveland and Lecturer in Preventative Medicine
at the University of Oklahoma, A graduate of the City College of New
York (B. S. S. ), the University of Pittsburgh (M. S. , Ph. D.) and the
Pittsburgh Graduate School of Public Health (M. P. H. ), he was the
recipient of a Fulbright Fellowship to Finland in 1964.
Currently a consultant for the American Institute of Research,
the Veterans Administration, and numerous industrial, educational,
and government organizations, Dr. Herzberg is the author of THE
MOTIVATION TO WORK and WORK AND THE NATURE OF MAN.
SUMMARY OF FILM,
1, Man has two different sets of needs, says Herzberg. Out of
that seemingly' simple observation has come both a new insight into
the nature of work motivation, and a valuable new strategy for
increasing employee productivity.
The classical approach to motivation, according to Herzberg,
has concerned itself only with the environment in which the employee
works: that is, the circumstances that surround him while he works
and the things he is given in exchange for his work. Herzberg
considers this concern with the environment a never-ending necessity
for management, but says it is not sufficient in itself, for effective
motivation. That requires consideration of another set of factors;
namely, experiences that are inherent in the work itself.
Herzberg's assertion that work itself can be a motivator
represents an important behavioral science breakthrough. Tra-
ditionally, of course, work has been regarded as an unpleasant
necessity, rather than as a potential motivator. For this reason,
it has generally been considered necessary for management to
entice people to work by means of various rewards, or to coerce
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved Fo6Release 2003/05/27 : CIA-RDP84-0078 005000020039-5
them to work by means of various threats, or both. According to
Herzberg, the potential motivating power of work was obscured by
the fact that most jobs were not at all stimulating, and therefore some
kind of external pressure, either positive or negative, had to be
applied to get people to do them. Indeed, many jobs today still have
this characteristic. But when a job provides an opportunity for personal
satisfaction or growth, a powerful new motivating force is introduced.
Herzberg holds that there is no conflict between the environmental
approach to motivation and the approach through work itself. He regards
both as important. However, the environmental approach, which he
refers to as hyiZ ene, is inherently limited in its capacity to influence
employee behavior; while the approach through the job, which he refers to
as motivation, seems to be capable of larger and more lasting effects.
2. Herzberg uses the term hygiene to describe such things as
physical working conditions, supervisory policies, the climate of labor-
management relations, wages and various "fringe" benefits. In other
words, hygiene includes all the various "bread-and-butter" factors
through which management has traditionally sought to affect motivation.
Herzberg chose the term "hygiene" to describe these factors because
they are essentially preventive actions taken to remove sources of.
dissatisfaction from the environment, just as sanitation removes
potential threats to health from the physical environment. His research
has shown that when any of these factors are deficient, employees are
quite likely to be displeased and to express their displeasure in ways
that hamper the organization- -for example, through grievances,
decreased productivity or even strikes. But when the deficiencies
are corrected, productivity may return to normal, but is unlikely to
rise above that level.
In other words, an investment in hygiene may eliminate a deficit,
but it does not create a gain. Further, it is inherent in the nature of
hygiene needs that satisfactions are not lasting, and that with the passage
of time a feeling of deficiency recurs. Just as eating a meal does not
prevent a man from becoming hungry again in the future, a wage increase
will not prevent him from becoming dissatisfied eventually with his new
wage level. Hygiene, according to Herzberg, is a necessary but thank-
less task for management. There can be no end to it, since inadequate
hygiene will surely lead to inefficiency. But even a fully effective hygiene
program will not, according to Herzberg, motivate employees to sustain
a higher-than-usual level of efficiency.
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For RIase 2003/05/27: CIA-RDP84-00780R9alr000020039-5
Herzberg uses the term motivation to describe feelings of
accomplishment, of professional growth and professional recognition,
that are experienced in a job that offers sufficient challenge and
scope to the worker. He chose this term because these factors seem
capable of producing a lasting increase in satisfaction, and with it an
increase in productivity above "normal" levels. This has been found
to be true in a wide variety of jobs and organizational settings. (It
is important to note that Herzberg uses the term "motivation" in a
restricted sense. He applied it only to the kinds of experiences that
produce sustained satisfactions, and does not use the term in its
more general sense which includes influences that have less lasting
effects. )
Herzberg's analysis focuses attention on job design. In most
cases, jobs were either not consciously "designed" at all, or were
designed primarily from the standpoint of efficiency and economy.
To the extent that these steps have taken the challenge and opportunity
for creativity out of a job, they have probably contributed t.o a de-
motivating effect. That is, Herzberg considers that apathy and minimum
effort are the natural results of jobs that offer the worker no more
satisfaction than a paycheck and a decent place to work. These hygiene
factors may keep him from complaining, but they will not make him
want to work harder or more efficiently. Offering still more hygiene,
in the form of prizes or incentive payments, produces only a
temporary effect. According to Herzberg, investments in hygiene
reach the point of diminishing returns rapidly and do not, therefore,
represent a sound motivational strategy.
3. Herzberg has been experimenting with what he calls "job
enrichment" as a means of introducing more effective motivation into
jobs. He draws a clear distinction between job enrichment- -the
deliberate enlargement of responsibility, scope and challenge--and
job rotation, the movement of an individual from job to job without
necessarily increasing responsibility at all. Herzberg has found
job rotation unsatisfactory as a motivating tool, but has achieved
impressive results with job enrichment. After an initial "adjustment"
period, during which productivity temporarily declines, efficiency
tends to rise well above previous levels--and more importantly, it stays
high. At the same time, employee satisfaction with the job reaches
very high levels.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For Release 2003/05/27 : CIA-RDP84-00780Rf05000020039-5
Herzberg regards money (and various money substitutes, such
as? "fringe" benefits) to be a hygiene factor. His studies have shown that
most people are not strongly affected by their incomes except when they
consider them inadequate - in which case they will be dissatisfied, and
will take whatever steps they can to correct the situation. This might
include working harder, if they thought that would have a reasonably
prompt effect on their incomes, or working less effectively, if they
felt that management was unresponsive to any other kind of pressure.
The important point, according to Herzberg, is that the positive effect
on effort is likely to be brief: the individual will either get his increase,
thereby eliminating the incentive for the extra effort, or he will decide
that the extra effort was futile and will revert to a normal working pace.
Further, satisfaction with a monetary increase does not last long, and
in time a new feeling of inequity will set in if new wage increases are
not forthcoming.
These observations lead Herzberg to conclude that the principal
effect of money is to create dissatisfaction (when pay is perceived as
inequitable), and that the principal effect of pay increases is to remove
dissatisfaction, not to create satisfaction. Therefore, careful attention
to wage and-salary is an absolute "must" for management, but it should
recognize that'it is only performing a hygiene function and cannot expect
this to be sufficient in itself for the attainment of effective motivation.
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
THE SELF-MOTIVATED ACHIEVER
DAVID C. McCLELLAND: BIOGRAPHY
David C. McClelland is Professor, Department of Social
Relations, Harvard University. He is currently president, New
England Psychological Association, director of research on
achievement motivation and economic development under grants
from the Ford Foundation, Carnegie Foundation, State Department,
National Institute of Mental Health, Peace Corps,. etc. He received
his A. B. from Wesleyan University, his A. M. from University of
Missouri, and his Ph. D. (Psychology) from Yale University, 1941.
Author of numerous books and articles, his principal works are:
THE ACHIEVING SOCIETY, 1961; and THE ROOTS OF CONSCIOUS-
NESS, 1964.
SUMMARY OF FILM'
}
L- Nearly everyone feels that he has an "achievement motive".
But according to McClelland, who has been studying this motive ever
since World War II, only about 10% of the U. S. population is strongly
motivated for achievement. That is a fairly high figure when compared
to most other countries- -high enough, according to McClelland, to
have powered the U. S. drive to a pre-eminent position in the world
economy. Still, that figure is surprisingly low to many Americans,
who are taught to think of themselves as a nation of achievers.
Part of the explanation is that McClelland gives the term
"achievement motive" a precise technical definition. According to
McClelland, the most convincing sign of a strong achievement motive
is the tendency of a person who is not being required to think about
anything in particular- -that is, when he is free to relax and let his
mind just "idle", as it were--to think about ways to accomplish
something difficult and significant. This tendency is measurable
by means of special psychological techniques.
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For Rase 2003/05/27 : CIA-RDP84-00780R4W000020039-5
A second characteristic of the achievement motive reveals its
importance to management. Although only about 10% of the people in
the population at large have a strong achievement motive, the per-
centage in certain occupations is likely to be much higher. This is
especially true of sales and marketing positions, managerial positions
of all kinds, and independent businessmen. Further, a man with a
strong achievement motive is likely to surpass the accomplishments
of an equally able but less strongly motivated man--especially in
one of these occupations.
2. McClelland's studies have identified three major characteristics
of the self-motivated achiever. These are "strategies" which the
achiever tends to follow throughout life, beginning at a surprisingly
early age. They help to explain why he is likely to be successful; and
they also indicate why supervisory tactics which may be appropriate
for other kinds of people are often inappropriate when applied to the
man with a strong achievement motive.
First, achievers like to set their own goals. They are nearly
always trying to accomplish something. They are seldom content to
just drift aimlessly and let life "happen to them". Further, they are
quite selective about which goals they commit themselves to, and for
this reason they are unlikely to automatically accept goals which other
people--including their supervisors- -select for them. Neither do
they seek advice or help, except from experts or people who can
provide needed skills or information. The achiever prefers to be as
fully responsible for the attainment of his goal as possible. If he
wins, he wants the credit, and if he loses he accepts the blame. Either
way, he wants the victory or the defeat to be unmistakably his.
Second, the achiever tends to avoid the extremes of difficulty
in selecting goals. He prefers moderate goals that are neither so
easy that winning them would provide no satisfaction, nor so difficult
that winning them would be more a matter of luck than ability. He
gauges what is possible, and then selects a goal that is as tough as he
thinks he can make--the hardest practical challenge. This attitude
keeps him continually straining his abilities to their realistic limits,
but no further. Above all else, he wants to win; and therefore, he
does not knowingly commit himself to a goal that is probably too
difficult to achieve.
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For RWase 2003/05/27: CIA-RDP84-00780R000020039-5
Third, the achiever prefers tasks which provide him with more
or less immediate "feedback"; that is, measurements of how well he
is progressing toward his goal. Because of the importance of the goal
to him, he likes to know how well he is doing at all times. This is one
reason why achievers often decide upon a career in sales. The sales-
man gets much more rapid feedback than people in most other occupations
about the effectiveness of his efforts: He either makes the sale or he
doesn't.
3. McClelland points out that the effect of a monetary incentive
on an achiever is actually rather complex. On the one hand, achievers
usually have a fairly high opinion of the value of their services, and
prefer to place a fairly high price tag on them. They are unlikely to
remain for long in an organization that does not.pay them well. On the
other hand, it is questionable whether an incentive payment actually
increases their output, since they are normally working at peak
efficiency anyway.
McClelland notes that monetary incentives are actually more
effective with people whose achievement drives are relatively weak--
since they need some kind of external reward to increase their effort
level--than with the achiever, whose drive is largely internal. Pro-
vided lie feels that he is being equitably paid, the main significance of
additional income for the achiever is as a form of feedback: a way of
measuring his success.
McClelland emphasizes that the achievement motive, as he
defines it, is not the only source of high achievement. Other drives
can also lead to high levels of attainment in other occupations. But
in the world of business, achievers have a considerable advantage.
This raises the question of whether the level of achievement motivation
could be increased in people whose achievement drives are not unusually
strong. McClelland believes that this may be possible; and indeed, that
there are considerable "reserves" of latent, untapped achievement
motivation in most organizations. The key, he feels, is to build more
"achievement characteristics" into more jobs: personal responsibility,
individual participation in the selection of productivity targets, moderate
goals, and fast, clearcut feedback on the results each individual is
attaining.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For Pia4ease 2003/05/27 : CIA-RDP84-0078OW5000020039-5
For achievers themselves, McClelland believes that many
standard supervisory practices are inappropriate, and in some
cases may even hinder their performance. Work goals should not
be imposed on the achiever: he not only wants a voice in setting
his own quotas, but he is unlikely to set them lower than he thinks
he can reach. Highly specific directions and controls are unnecessary:
some general guidance and occasional follow-up will do. But if the
job does not provide its own internal feedback mechanism regarding
the achiever's effectiveness--if he is, for example, in a professional
or administrative job--then it is vitally important to the achiever
that he be given frank, detailed appraisals of how well he is perform-
ing his job.
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For ease 2003/05/27 : CIA-RDP84-00780000020039-5
UNDERSTANDING MOTIVATION
SAUL W. GELLERMAN: BIOGRAPHY
Dr. Saul W. Gellerman is President of Gellerman Kay Corp.,
a management consulting firm in Harrington Park, N. J. Previously
he was Executive Research Consultant for International Business
Machines Corporation, and Manager of Personnel Research for IBM
World Trade Corporation.
He is a graduate of the University of Missouri (B. A. 1949,
M. A. 1950) and the University of Pennsylvania (Ph. D. 1956).
Dr. Gellerman is the author of MANAGEMENT BY MOTIVATION,
1968; MANAGEMENT OF HUMAN RELATIONS, 1966; MOTIVATION AND
PRODUCTIVITY, 1963; PEOPLE, PROBLEMS AND PROFITS, 1960.
SUMMARY OF FILM
1. Modern management is being reshaped by scientific and
technical developments. Among these are such disciplines as Operations
Research, Computer Mathematics and Behavioral Science. In this film,
Gellerman defines behavioral science, revi ews its relatively brief
history, and shows how it is being applied to practical management
problems.
According to Gellerman, behavioral science is the systematic
measurement of worker attitudes and actions, and of factors in the
environment that can affect them. These studies are based as much
as possible on repeatable measurements: that is, they are independent
of the opinions of the researcher himself. The basic strategy of
behavioral science is to question the assumptions on which managerial
practices are based and to test them against reality. The behavioral
scientist is, in other words, a professional skeptic. According to
Gellerman, this skepticism has already paid off significantly for
managers and behavioral scientists alike. In addition to providing
new theoretical insights, behavioral science has proven its worth as
a management tool.
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For Rase 2003/05/27 : CIA-RDP84-00780Rga6000020039-5
An organization's employees--that is, the human assets through
which the enterprise seeks to get its work done--are nearly always a
significant cost factor. When they are motivated to be cooperative and
creative, they can also be a significant profit factor. However, most
experienced managers would agree with Gellerman that this happens
all too rarely. But Gellcrman asserts that there is nothing inevitable
about the lack of effective work motivation. It is often the unintended
result of management practices that are either antiquated or unrealistic.
While a number of issues in behavioral science remain to be
resolved, Gellerman says that there are enough consistencies in
behavioral research findings to permit some useful generalizations.
One of these is that many "motivational problems" are more likely to
result from the way an organization is managed than from a simple
unwillingness on the part of employees to work hard. Another
generalization is that modern management has a tendency to over-
manage--that is, to define the employee's job too narrowly and to
make too many decisions for him. Another is that if you want to
understand the reasons why an employee behaves as he does, you
have to learn to look.at his environment the way he does. Conclusions
like these emerge from many behavioral research studies that have
been completed in a wide variety of industries. They are evidently
not peculiar to any particular industry, geographic region or type of
job.
2. One reason why managerial practices are often antiquated,
says Gellerman, is that the environment of most working people has
been changing rapidly. Today's employee is typically much better
educated, more in demand and therefore more independent, than the
typical worker of only a generation ago. But management practices
have not always kept pace with these changes. Consequently, moti-
vational methods which may have worked well enough a generation
ago are increasingly ineffective today. Neither the threat of losing
a job nor the attraction of more money are enough, in today's
environment, to assure effective motivation.
To explain why changes in the environment affect employee
motivation, Gellerman cites a frequent finding of behavioral scientists:
that nearly everyone regards his own behavior as sensible and justifiable.
In other words, people are always behaving in ways that make sense to
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For Rase 2003/05/27 : CIA-RDP84-00780RQQy000020039-5
them, based on their understanding of the circumstances on which they
find themselves. Of course, that same behavior may seem quite
irrational to someone else. According to Gellerman, the difference
probably lies in the fact that they aren't making the same assumptions
about those circumstances.
In particular, managers are likely to have attitudes toward their
environments (which usually seem full of challenges and opportunities)
that are quite different from the attitudes employees have toward their
environments (which are more likely to seem rather dull and un-
stimulating). To occupy the same physical environment is not necessarily
to see it the same way or to share the same attitudes toward it. Accord-
ing to Gellerman, this difference has led to a great deal of misunder-
standing on both sides. Unfortunately, it has also led to motivational
strategies which may have looked sound enough to managers, but did
not have the desired effect on employees --simply because they looked
at it in an entirely different light.
3. Motivation is not simply a matter. of things that a manager
does to influence his subordinates. It is much more complex than that.
People are motivated not so much by what other people want them to
do as by their own desire to get along as best they can in the kind of
world they think they are living in. Gellerman calls this the "principle
of psychological advantage". Basically, it means that people will tend
to seek whatever values they consider important to the extent that
they believe it is safe and possible for them to do so.
To most employees, the manager (and. indeed, the organization
as a whole) is simply a part of his over-all environment, and not
necessarily the most important part. He will make concessions to
his manager to the extent that he thinks he must, but he will not
necessarily consider it advantageous to do more than that unless--
and this is a big "unless"--it appears that doing so will lead to a
lasting, significant gain. That "gain" is not necessarily monetary.
It often has more to do with a change in the "role" the individual can
play (that is, the kind of activity and the degree of self-management
expected of him) than with money itself.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For Ruse 2003/05/27: CIA-RDP84-00780ROW00020039-5
Gellerman notes that all people are motivated, and that most
of the things that management does have a motivational effect. The
problem is that too often people are motivated to act in ways which
are unproductive. This is usually because they see no advantage in
increasing their productivity, or because they are actually motivated
to thwart the organization if they can.
Restriction of output can occur even in the face of incentive
payments, simply because the employees regard the incentive as a
bad bargain. They don't expect it to be a lasting advantage, and even
if it were, it brings the risk of lasting disadvantages (the hostility of
fellow workers) which would more than offset the gains. Underlying
these attitudes is a basic conviction that management regards the
employee solely as a cost factor to be minimized; and that consequently
management's actions toward employees are likely to be against their
real interests regardless of how attractively they may be packaged.
Gellerman notes that situations of this kind are very difficult to deal
with effectively. The root cause is the employee's perception of the
way management perceives him. Changing this requires time,
patience, and above all, a genuine willingness to deal with employees
as individuals.
:.e
According to Gellerman, the role of money in motivation must
be seen in its true perspective relative to other motivations. Money
is neither all-important, as some management theorists have assumed,
nor unimportant, as some oversimplified versions of behavioral .
science have implied. The effect of a possible monetary gain on an
individual's behavior depends on his financial status, and more broadly on
the psychological meaning of money for him. Money is an effective
motivating tool when financial needs are strong and/or when money can
serve some important psychological purpose for the individual. It does
not tend to be effective when financial needs are not strong, or when
money does not have an important psychological value. In the case of
restriction of output, a potential monetary gain is often incapable of
changing behavior even when there is financial need; because it
conflicts with a still stronger psychological value (acceptance by one's
fellow employees).
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For Reirdse 2003/05/27: CIA-RDP84-00780ROW00020039-5
4. Gellerman stresses that behavioral science has not revealed
a simple list of "do's and don'ts" for managers. On the contrary, it
has revealed that the process of management is much too complex to
be handled effectively by approaches that require no analysis or
creativity on the part of the manager. What behavioral science does
offer is a strategy for analyzing motivational problems, and some
clues as to the general causes of common problems. It is up to the
individual manager to diagnose the specific problems that he is
confronted with, and to take action that is addressed to root causes
and not merely to symptoms.
Gellerman lists three broad prescriptions which ln. ve often been
found to have a positive motivational effect. They will not necessarily
be effective in all cases, and should therefore be used selectively.
One is what he refers to as "stretching"; that is, the deliberate
assignment of duties that are somewhat more demanding (in difficulty
level, not necessarily in terms of time or effort) than the manager
himself thinks the employee can handle. This enhances the likelihood
that the employee will experience the satisfaction of achievement,
and develop a desire for more of it. Another prescription cited by
Gellerman is "management by objectives"; that is, giving the employee
rather?broail discretion over the details of how his work is to be
handled, provided he reaches certain precisely defined targets and
stays within prescribed cost limits. This is likely to increase the
employee's commitment to his work, because the results he achieves
become more of a measurement of his abilities than of his manager's.
Gellerman also advocates "participation", which is a general strategy
of seeking employee comments and suggestions prior to taking signifi-
cant decisions affecting their work. Even if their suggestions are
not accepted, the fact of their having been consulted makes management
decisions more understandable to the employees, and therefore, less
likely to be misinterpreted.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For Ftiease 2003/05/27 : CIA-RDP84-00780R*05000020039-5
THEORY X AND THEORY Y
The Work of Douglas McGregor
BIOGRAPHICAL NOTES
DOUGLAS McGREGOR was one of those rare men, who,
somehow, was able to see farther into the future than the rest of us
a man whose impact upon management has probably been more
profound, more far-reaching than that of any behavioral scientist
of his time. He died in October, 1964 at the age of 58. He was
then Professor of Industrial Management at the Massachusetts
Institute of Technology. McGregor was more than a behavioral
scientist. He was also a top-level executive and a management
consultant to several major companies. So, obviously, he had
his practical side. Still, McGregor insisted on the importance
of intangibles to management. He once said that every managerial
act rests on a theory. And he said that the critical difference
between effective leadership and ineffective leadership in industry
did not lie in a company's, policies or procedures; neither did it
lie in the personal style of an individual manager, but rather it
could be found in that manager's assumptions -- in the subtle,
frequently unconscious effects of those assumptions about the
nature of management and about people in general.
WARREN BENNIS is academic vice president, State University
of New York at Buffalo.
RICHARD BECKHARD is consultant and senior lecturer in
Organizational Behavior, Sloan School of Management at MIT.
JOHN PAUL JONES is vice president of organization development,
Federated Department Stores, Incorporated.
(NOTE: This summary covers both McGregor films - Part I -
Description of the Theory, and Part II - Application of the Theory.
Douglas McGregor, who died in 1964, is generally credited
with being one of the most influential behavioral scientists of our
times. His work is widely respected by behavioral scientists and
managers alike. McGregor was not so much a researcher as an
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For Rase 2003/05/27: CIA-RDP84-00780ROO6000020039-5
interpreter and clarifier of the research that other men had carried
out. His major contribution was in recognizing the importance
to management of behavioral research findings, and explaining
the practical implications of these findings to managers. He
was the first man to successfully bridge the gap between
laboratory research and managerial applications, and in that
sense his work is fundamental to an understanding of modern
behavioral science.
These two films deal primarily with McGregor's best known
contribution, Theory X and Theory Y. While on the surface this
distinction between two contrasting sets of assumptions about
human nature is disarmingly simple, the reasoning behind it is
actually quite subtle. For this reason, there has sometimes
been a tendency to oversimplify what McGregor had in mind.
Those who knew McGregor well say that this tendency was
rather disturbing to him, and that one of his reasons for writing
his last book (The Professional Manager, McGraw Hill, 1967)
was to clarify and refine his ideas on the subject.
. Actually, Theory X and Theory Y have been the subject
of a nup fiber' of interpretations, and as research data and experience
accumulates there have been attempts to restate the theory more
precisely. In the films, the discussion between the various
principals reveals their attempts to phrase the essence of McGregor's
ideas in ways that are consistent with their own developing experience
in working with them.
In Theory X and Theory Y, . McGregor was basically trying
to account for certain aspects of human behavior, especially that
behavior which resulted from attempts to deliberately influence it.
As Warren Bennis points out in the film, the two theories are
essentially statements of how one person's influence on another
person's behavior is believed to take place. McGregor stressed
the fact that most attempts to influence other people's behavior
are actually based on a set of assumptions which are seldom tested
or even recognized as assumptions. That is, most people act as
if their underlying beliefs about human nature were correct and re-
quired no particular review or checking.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For ease 2003/05/27 : CIA-RDP84-00780F,&000020039-5
Because our behavior tends to be consistent with our
assumptions, our overt attempts to influence other people usually
include some indications (usually subtle, and not necessarily
noticeable to ourselves) of what those assumptions are. In other
words, the ways in which we deal with each other usually com-
municate something about the way in which we feel about other
people's ability and reliability. These assumptions of ours are
more likely to be communicated by gestures, expressions, tones
of voice and-other subtle cues than by the actual words we use.
For example, if we are working with a person who we feel
does not fully understand the requirements of his job, and who
does not appear to take his responsibilities very seriously, we
will try to communicate with him in a way that compensates for
these presumed "deficiencies" of his. In such a case, the
instructions we give may be rather more detailed, and our
checking on his performance rather more frequent, than would
otherwise be the case. According to McGregor, the implication
of these nuances in our behavior (namely, that we don't entirely
trust the individual) are usually clear enough to the individual to
affect his behavior. But instead of making him more effective
and responsible, the opposite effect is likely to occur because
our behavior is really a demand for compliance and provides
little opportunity for learning to be effective on the job or for
developing a sense of personal responsibility.
In other words, our assumptions about people often lead
to what McGregor called a "self-fulfilling prophecy", in which
our own behavior prevents other people from behaving toward
us in ways that are inconsistent with our assumptions about them.
According to McGregor, this phenomenon leads to a wholesale
waste of talent, because human potentialities are not given an
adequate chance to develop on the job.
The distinction between the abilities which people have
already developed, and their potentiality for further development,
is one of the major differences between Theory X and Theory Y.
Basically, McGregor was trying to describe two contrasting
approaches to the problem of influencing other people's behavior.
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For Release 2003/05/27 : CIA-RDP84-00780RO000020039-5
Theory X is a rather common set of assumptions which is more
concerned with behavior that can be readily observed than with
potentialities for developing more effective forms of behavior.
Theory Y, which is less consistent with traditional ideas about
influence, and therefore probably less common than Theory X,
is less impressed by readily observable behavior than by
potentialities for growth and development through learning.
Theory X, in other words, regards human capacities as
static, unimprovable, and for the most part not very impressive.
It follows from this that if productive work is going to be ac-
complished at all, some means must be found to compensate for
prevalent human deficiencies such as poor judgment, passivity, and
irresponsibility. Two basic strategies emerge from Theory X:
one involves compensating for human deficiencies by coercing
people into behaving as they should by means of threats, punishments,
discipline and surveillance; the other involves coaxing them to do
what they should by means of rewards, praise, permissiveness
and blandishments.
Although these two approaches are superficially quite different
they are based on essentially the same underlying assumption,
namely that productive work is an unnatural form of behavior for
most men, and that some kind of pressure must be applied in order
to obtain productive work from them. Generally speaking, the
coercive approach stimulates resistance, apathy and deliberate
restriction of output, while the coaxing approach stimulates a
casual sense of responsibility for production and only sporadic
commitments of talent and effort.
As Richard Beckhard points out in the films, neither of these
two variations of Theory X is likely to lead to sustained high levels
of productivity. Further, the "coaxing" approach, which is some-
times mistaken for what McGregor meant by Theory Y, may lead
to comfortable relationships between managers and subordinates
but is unlikely to tap latent reserves of energy and creativity. The
basic defect with both of these variations on Theory X is that they
do not recognize, and hence cannot stimulate, the natural human
tendency to develop talent and responsibility to progressively
higher levels.
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For RWase 2003/05/27: CIA-RDP84-0078ORQQ 000020039-5
Theory Y has sometimes been misinterpreted as suggesting
that if everyone is left to his own devices, he will tend to become
more productive than if he is firmly led. Actually, McGregor's
position was that under the right conditions, many people (not
necessarily all.) could find sufficient satisfaction in work to devote
more effort to it than they would in response to coercion or coaxing
only. In other words, if the work itself was so structured as to
provide opportunities for a sense of achievement and personal
growth, these experiences would provide a more powerful moti-
vation for continued effort than any externally applied "motivation. "
In this sense, McGregor's Theory Y anticipated much of the cur-
rent emphasis on job enrichment.
However, McGregor stressed that these changes could not
be easily accomplished, because what was involved. was not so
much a change in managerial tactics as in managerial assumptions.
That is, the necessary conditions for developing human potentials
were unlikely to be created unless managers understood and
believed the basic assumptions of Theory Y (namely, that judgment
and responsibility could be developed even in persons whose
behavior did not suggest such capacities currently, and that an
atmosphere of tolerance and trust was the best setting for such
a development to occur).
As Richard Beckhard points out in the film, the question of
how such trust can be developed has too often been approached
from the standpoint of, "What specific action program should we
follow in order to develop trust? " Actually, the best way to
develop trust is to undertake a collaborative effort in which mutual
support is necessary for success. Similarly, the best way to
establish whether Theory Y assumptions apply to any given indi-
vidual is to make them about him, and treat him as if he were at
least potentially a highly motivated, responsible, achieving person.
In other words, Theory Y involves risks. It is essentially
an invitation to explore the limits of human capacities, rather
than accepting them as unchangeable; and it is also, as McGregor
put it, "an invitation to innovation" in the sense that specific
ways of treating individuals on the basis of these assumptions
have to be worked out individually, based on both the person and
the job.
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For Rv ase 2003/05/27 : CIA-RDP84-00780R! 5000020039-5
John Paul Jones recounts some of the more sophisticated
applications of McGregor's basic ideas to management develop-
ment and the resolution of managerial problems which were due
more to a failure of collaboration than to technical deficiencies.
As Jones points out, McGregor felt that where conflict existed,
a candid confrontation was more likely to remove the roadblock
than a passive acceptance of the situation. Here, as in Theory
Y, McGregor was much more concerned with organizational
effectiveness than with avoiding temporary discomfort or
stress.
In fact, a close reading of McGregor reveals him to be
considerably more tough-minded, results-oriented, and
realistic than many managers who subscribe to what is essen-
tially a Theory X approach. The main difference between them
lies in their beliefs about the realities of human nature. McGregor,
a life-long student of behavioral science and a man who was
intimately acquainted with high-level executive problems, clearly
felt that the realities of human nature were considerably more
complex and fluid than traditional managerial thinking had
supposed.
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For-lease 2003/05/27 : CIA-RDP84-00780R005000020039-5
HUMAN NATURE AND ORGANIZATIONAL REALITIES
CHRIS ARGYRIS: BIOGRAPHY
Chris Argyris is Beach Professor of Administration Sciences,
Director of Research on Problems of Individual-Organizational Health,
and Fellow, Jonathan Edwards College, Yale University. He is
consultant to many industrial and business organizations, as well as
numerous governmental agencies in the United States and England,
Norway, Sweden, Holland, France, Italy, Greece and Germany. He
is author of more than 100 articles and 13 books, including such major
publications as ORGANIZATION AND INNOVATION, 1965; INTEGRATING
THE INDIVIDUAL AND THE ORGANIZATION, 1964; INTERPERSONAL
COMPETENCE AND ORGANIZATIONAL EFFECTIVENESS, 1962.
SUMMARY OF FILM
1. The problems of worker apathy and lack of effort are not,
according to Argyris, simply a matter of individual laziness. Rather
they are often healthy reactions by normal people to an unhealthy
environment created by common management policies. More
specifically, Argyris states that most adults are motivated to be
responsible, self-reliant and independent. These motives are
acquired during childhood from the educational system, the family,
and communications media such as books, television and radio. But
the typical organization confines most of its employees to roles that
provide little opportunity for responsibility, self-reliance or inde-
pendence. On the contrary, too many jobs are designed in ways that
make minimal demands on the individual's abilities, and that place
the responsibility for major decisions not in his hands but in his
supervis ox's .
In effect, such jobs create a child-like role for the employee
and frustrate his normal motivations for a more adult role. Argyris
says that the common reaction of withdrawing one's interest from the
job--treating it with indifference or even with a certain degree of
contempt--is a necessary defensive maneuver that helps the individual
to preserve his self-respect. Unfortunately, the cost of these
reactions to the organization is heavy: minimal output, low quality,
and excessive waste.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For Rase 2003/05/27: CIA-RDP84-0078ORN5000020039-5
2. According to Argyris, both labor unions and management
have missed the main point with regard to employee motivation.
They have concentrated largely on matters related to income: job
security, pay and "fringe" benefits. These are necessary, but in
themselves insufficient, conditions for effective motivation. Argyris
feels that the battle for adequate employee incomes was fought and
won long ago. Today the real frustration of most employees is not
so much a matter of income as of utilizing their abilities in a signifi-
cant way. They need, in other words, a sense of pride and accomplish-
ment from their work; but instead of this, they find their work neither
stimulating nor dignifying.
So for the typical employee, work tends to become a "necessary
evil" rather than a source of personal satisfaction. This is why
Argyris feels that the psychological importance of income is changing
for many workers: they no longer regard it chiefly as a means of
elevating their standards of living. Instead, it has taken on some of
the characteristics of a penalty payment: a "fine" that they can
periodically levy against their employers to compensate them for the
lack of satisfaction in their work. Since the external symptom of
this smoldering resentment is a continual demand for income
improvexnei t, both management and labor tend to be blinded to its
underlying causes. But both are also under pressure to match income
improvements to productivity improvements. Argyris says that the
potential contribution of motivation to increased productivity is
largely neglected in negotiations over income, since these deal only
with the symptom and do not address themselves to the underlying
cause.
3. Argyris has experimented with various techniques to improve
employee motivation. In the film he describes one of these experiments:
a revision of work-flow in a factory. Assemblers were made responsi-
ble for the entire final product, instead of for only a few parts. Such
changes make the employees' work more complex and place a much
heavier burden of responsibility upon them. After an initial adjustment
period during which productivity temporarily decreases, normal
output levels are re-attained and sometimes exceeded. The motivational
change in these experiments is revealed by a much lower rejection
rate, reflecting greater care on the part of the employees, and by
lower costs, as well.
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For Lease 2003/05/27 : CIA-RDP84-007801485000020039-5
Argyris notes that such programs must be undertaken selectively,
since not every employee wants to accept more responsibility, or is
prepared to carry the added burden of worry that responsibility
inevitably brings. Nevertheless, he asserts that the number of
employees who can be successfully motivated by upgrading their
responsibilities is much larger than most managers would suspect.
4. Argyris makes a clear distinction between "happiness" and
"motivation". A happy employee is not necessarily motivated to work
more effectively, and an employee who is motivated to be more pro-
ductive is not necessarily happy. The idea that behavioral scientists
advocate making employees "happy" as an end in itself is a miscon-
ception. If anything, the superficial signs of employee moods are
less positive among employees whose responsibilities have been
upgraded. There is less joking and light conversation, more pre-
occupation with the job and worry about factors that may affect their
output, such as parts deliveries.
In a larger sense, however, there is little question but that
successfully motivated employees derive a greater sense of personal
value and significance from their work than employees who are not
effectively motivated. Their job becomes the central focus of their
efforts, imagination and ambitions--not just a "necessary evil"--
because that is where they experience their major satisfactions.
5. Argyris has also examined some of the problems encountered
by managers in their work. In particular, he is concerned with "built-in
inefficiencies" in the decision-making process that can affect the
operations of entire organizations. Argyris traces these difficulties
to the nature of interpersonal relationships--that is, the characteristic
ways of perceiving each other and of dealing with each other--among
managers. After observing hundreds of management meetings in a
variety of companies and organizations, Argyris concludes that many
managers inadvertently "filter" the information they are given by
others. He also concludes that many managers have difficulty in
telling each other what is really on their minds ("leveling" with each
other).
These and other difficulties in the communications process
result in wasted time, delayed reactions and ineffective decisions.
This lack of "interpersonal competence" is by no means peculiar to
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For Ruse 2003/05/27 : CIA-RDP84-00780R04AO00020039-5
managers--other groups have the same problem--but its consequences
for the organization as a whole are much more severe in the case of
managers than they are for other groups.
6. One method that has been developed for trying to improve
interpersonal competence is "laboratory training", which is also
known as "sensitivity training" or "T-group training". The basic
strategy of a T-group is to place people in a unique situation which
can facilitate openness and risk-taking, while minimizing defensiveness
and mistrust. In other words, the T-group attempts to provide an
opportunity for behaving in a manner which makes communication much
more precise and much less subject to barriers or filters. The more
experience an individual has in dealing with others in this way, the
more likely he is to be able to transfer some of these skills to the
ordinary work situations he confronts daily.
To provide this unique atmosphere, the T-group deliberately
dispenses with the usual "props" that define status and therefore
tend to inhibit free communication. The sessions are very informal,
with no chairmen and not even an agenda. The group discovers,
usually to its surprise and discomfiture, that it is difficult for it to
accomplish much without having a rigid framework that gives everyone
a more or less "pre-determined" role to play. It is in the course of
coping with this dilemma that the members of a T-group begin to
learn from each other about the impact that their tactics have on
other people, how they themselves are perceived, and what happens
to the "messages" that they try to send to other people.
Argyris notes that T-group training is not a panacea for
managerial problems, and that there are certain groups or individuals
for whom he would not recommend it. The results of this training
have been important but not dramatic. In the case of groups whose
members did not work in the same organizations, there is evidence
that T-group training helps to make a man a better listener. That is,
he learns more from what people tell him, and more quickly, than
he could before the training. In the case of groups whose members
are part of an actual working team, decisions are reached faster, and
prove to be more effective, than the decisions the same group was
able to make prior to the training.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For Reuse 2003/05/27 : CIA-RDP84-00780Re4000020039-5
THE MANAGEMENT OF HUMAN ASSETS
RENSIS LIKERT: BIOGRAPHY
Dr. Likert is the Director of the Institute for Social Research
and a Professor in both the Psychology and Sociology departments at
The University of Michigan. He is a past president of the American
Statistical Association and has served on the Board of Directors and
the Policy and Planning Board of the American Psychological
Association. Dr. Likert's personal research interests in recent
years have focused on the study of organizational theory and
management practice. This work forms the basis of his most recent
books: NEW PATTERNS OF MANAGEMENT, 1961; and THE HUMAN
ORGANIZATION: ITS MANAGEMENT AND VALUE, 1967.
SUMMARY OF FILM
1. When an organization is faced with the need to conserve
cash, the most common reaction is to cut expenses and "tighten up"
operations.; Hierarchical pressure from the top is transmitted
througt the management ranks into every department to work harder
and spend less. When the results are measured by ordinary accounting
procedures, they usually show that more cash is being generated than
before. The usual interpretation given to such figures is that manage-
ment has made the organization profitable again.
Likert, whose Institute has conducted behavioral research
studies in hundreds of organizations, disagrees with that interpretation.
He points out that cash is not necessarily profit. Cash can also be
generated by liquidating assets, and that is exactly what happens in
many cost-cutting programs. Traditional accounting fails to measure
what happens to an organization's human assets: that is, the skills,
experience, loyalty, and know-how of its employees. If these are
damaged, the organization may show more cash on its balance sheet,
but it will be less capable of operating efficiently than before. The
result, according to Likert, is the same as failing to keep plants or
machinery in good operating condition: a short-term gain has been
bought at the cost of long-term earning power.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For Rase 2003/05/27 : CIA-RDP84-00780RNQ&000020039-5
Likert's studies show that when cost-cutting is applied
insensitively--that is, when management adopts a tough, take-it-
or-leave-it attitude--the reaction is likely to run through three
phases. First, employees become resentful, hostile and distrust-
ful toward management. Second, as a result of these attitudes,
employees are likely to submit many more grievances than usual,
work carelessly and wastefully, restrict production, and even leave
the organization to find employment elsewhere. The latter is most
likely to occur with the more able engineers and managers and the
most highly skilled workers, because they are the most easily
re-employed. The effect of their departure is to lower the average
level of competence in the organization. Finally, the cumulative
result of all these manifestations of employee resistance is greatly
reduced efficiency and, in all probability, another financial crisis--
that could be worse than the one the original "cost-cutting" program
was intended to cure.
2. Likert has developed methods which enable the members of
an organization to rate it in terms of several variables which he has
found to be important. Among these are the leadership styles that
are characteri stic of the company, the freedom (or lack of it) which
subordinates feel about communicating with their superiors, and the
degree of confidence and trust which subordinates feel. that their
superiors have in them.
Based on the responses of an organization's members to
questions such as these, Likert finds that most organizations can"
be given a numerical rating on a four point scale that expresses the
prevailing management system. This scale runs from System 1 --
an arbitrary, coercive, highly authoritarian management style that
is seldom encountered any longer in its "pure form" -- through
System 4 -- which is based on teamwork, mutual confidence and
trust, and a genuine respect for the individuals who comprise the
organization. System 4 in its "pure form" is also relatively rare.
Systems 2 and 3 are intermediate stages. The Likert technique
also permits finer gradations between Systems 2 and 3, etc.
One of Likert's more significant findings is that the more
closely a company's management style approximates System 4, the
more likely it is to have a record of sustained high productivity,
good labor relations, and high profitability. Similarly, the more
closely an organization approximates System 1, the more likely
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For Ruse 2003/05/27: CIA-RDP84-00780RO OO0002003.9-5
it is to be inefficient and to suffer from recurrent financial crises.
These same relationships also hold for shifts in the management
system being used if the entire assets of the firm are taken into
consideration. That is, shifts in the management system toward
System 4 result in improving performance; shifts toward System 1
yield poorer results. These findings have been repeated in so
many different studies that Likert states flatly that a general
principle of effective management has been demonstrated. The
future, according to Likert, belongs to organizations that are
practicing, or can convert to, a management style approximating
System 4.
3. One of the reasons why the superiority of System 4 is
not always readily apparent is the time factor. System 1 management
(typified by the coercive cost-cutting approach) produces short-term
gains (in cash, not profit) quickly; and its long-term disadvantages
become apparent only slowly. On the other hand, shift in manage-
ment style toward System 4 does not, as a rule, produce rapid
increases in cash income. Total true earnings become greater
because of the increased value of the human organization but
profitability in the form of current cash does not -- at least not
immediately. In fact, it may even become worse before it becomes
better; But System 4 builds steadily toward a flexible, responsible
team that can achieve and maintain high profitability.
Moreover, System 4 can in emergencies cut costs and improve
productivity readily by cooperative, concerted effort. Likert finds
that the management style of a firm and the motivations and attitudes
of the employees are "leading variables"; that is, they change before
profitability changes. Management style has a greater lead time
relative to profitability than do measurements of employee motivations
and attitudes. It is also a leading variable with regard to changes in
employee motivations. For this reason measurements of the manage-
ment style and attitudes and motivations can be a useful barometer:
a sort of forecast of whether the productive power of a company's
human assets are likely to increase or decrease. Likert feels
that a realistic accounting of an organization's total capability to
continue earning a return on its investment requires measurements
of management style and attitudes and motivations, as well as standard
financial measurements.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For ease 2003/05/27 : CIA-RDP84-007805000020039-5
In order to harness the productive power of human assets,
instead of having continually to struggle to keep them under control,
System 4 relies on three basic principles: The first is to utilize
modern principles and techniques of motivation, rather than relying
on the traditional combination of rewards and threats. A key to
doing this is to apply fully the "principle of supportive relationships",
which is basically a matter of dealing with people in ways that main-
tain or enhance their feelings of self-worth in terms of their needs,
desire and values. The second principle is to build an organization
of tightly-knit, highly motivated work groups committed to achieving
the objectives of the organization. These groups are linked together
to form the overall organization by persons who hold overlapping
memberships in two groups. The third principle, according to
Likert, derives from the principle of supportive relationships:
management holds high performance goals for itself and for all
employees, and makes it clear that it expects them to be met. In
other words, setting high goals for efficiency and productivity can
be attained best by a system of management that is geared to satisfy
real human needs. In addition, the usual conditions required for
successful operation need to be present, such as adequate technical
competence on the part of managers.
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For Tease 2003/05/27 : CIA-RDP84-00780Fi005006020039-5
"EFFECTIVE ORGANIZATION"
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For Rase 2003/05/27: CIA-RDP84-00780ROU000020039-5
THE GELLERMAN EFFECTIVE ORGANIZATION FILM SERIES
Building on the widely acclaimed Gellerman Motivation and Productivity
Series, BNA FILMS has once again captured the ideas of a group of leading
behavioral scientists. Whereas the first series featured leading authorities
from the universities, the new series deals with the applications of behavioral
science practitioners in different organizational settings.
Featured "guest stars". are Sheldon Davis, Vice President and Director
of Industrial Relations of the Systems Group of TRW, Inc. , Dr. Alfred
Marrow, Chairman of the Board of the Harwood Companies, Emanual
Kay, Dr. Gellerman's partner, Douglas Bray, Director of Personnel
Research at A. T. &T., and Scott Myers, industrial psychologist and consultant.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For RJ ase 2003/05/27 : CIA-RDP84-00780R 5000020039-5
FILM 1
ASSESSING MANAGEMENT POTENTIAL
with Douglas Bray
Drawing on more than 15 years' experience in early identification of
management potential at A. T. &T. , Doug Bray emphasizes why every
organization should have a systematic management progression program.
Without it, he says, promising youngsters get stuck in narrow departmental
channels of promotion; are required to pass through sometimes needless
job sequences because of an over-emphasis on specific job knowledge; and
must rely on the "good conduct report" of their immediate superior for any
chance at promotion.
Bray describes "management assessment center" techniques, which
he pioneered. Candidates from different parts of the organization participate
in various simulation games and exercises. Each candidate's performance
is appraised by trained assessors, insuring impartial judgment of his
management potential.
Two dramatized cases highlight the film. In one, a division manager
faces a crisis because of a heart attack suffered by his chief accountant.
A newcomer to the division, the manager is amazed to find that no plans
have been made for such emergencies, and he must rely on the unsub-
stantiated opinions of the comptroller to pick a successor. The second
case shows how an assessor skillfully conveys to a young man, who has
just completed his stint at an assessment center, the fact that he is not
qualified to be considered for promotion to management ranks. A classic
example of the right way to convey "negative information, " this case could
be the model for many types of manager-subordinate interviews.
The film, in general, is of value in pointing up problems relating to
managerial succession, promotion policy and practice, managerial selection
techniques, career counseling, and the like.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For Release 2003/05/27: CIA-RDP84-00780RMOO00020039-5
FILM 2
MANAGEMENT BY PARTICIPATION
with Alfred Marrow
Probably the only Board Chairman of a large company who also has a
Ph. D. in Psychology, Alfred Marrow has fostered the application of
behavioral science research in his companies for more than 25 years. And
he has impressive records of concrete results in terms of both employee
satisfaction and company earnings. Marrow describes how the now classic
participation techniques got started and how they work out in practice, noting
pitfalls as well as opportunities along the way.
Filmed in the Marion, Virginia plant of the Harwood Company, where
much of this research took place, three dramatic vignettes highlight the
change in supervisors' and employees' attitudes as they gradually accept
the idea of participation. Skilled professional actors re-create "real-life"
experiences as plant management and staff overcome skepticism and new
concepts of responsibility -- both of supervisors and employees -- come
into being.
A. valuable. film to treat issues such as organizational climate, leadership
style, participation vs. "permissiveness, " group involvement in problem
solving and altering managerial and employee attitudes toward new
management practices.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved Forplease 2003/05/27 : CIA-RDP84-0078OW05000020039-5
FILM 3
PAY FOR PERFORMANCE
with Emanual Kay
What are more progressive companies doing to insure maximum advantages
from the salaries and wages they are paying? How can they at least avoid
the negative effect of poorly-known, poorly-understood pay policies which
employees consider inequitable? Manny Kay tackles these difficult questions,
aided by a real-life. drama which is reproduced every day in countless
dining rooms throughout the country: wife badgering husband to "be a man"
and ask for a raise. When the wife asks: "How do they decide who gets
raises at that stinking company? IT the husband has to admit: "I don't know. "
The second part of this film deals with goal-setting, which is rapidly
replacing traditional performance appraisal programs at many companies.
Instead of acting as judge, and the subordinate as defendant, the supervisor
in the goal-setting process works out with each employee mutually agreed-
on objectives and time limits for achieving them. Kay provides several
examples of goal-setting in practice, including one dramatized episode
showing a salesman and his sales manager "feeling their way" through their
first goal-setting session.
A highly useful film in a highly neglected area -- i. e. , pay, performance,
appraisal, motivation and morale.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For Rase 2003/05/27 : CIA-RDP84-00780R8 6000020039-5
FILM 4
TEAM BUILDING
with Sheldon Davis
It is a well-known fact that we judge ourselves by our intentions, and
we judge other people by their actions. In team-building, people whose jobs
are inter-related try to explain their own actions and understand other persons'
intentions. As Shel Davis of TRW Systems, defines it, team-building is
a conscious effort of people in the work-group to improve their effectiveness
in working together. In team-building sessions, the people involved "level"
with each other, not to probe into each others' minds, but to understand
job-related behavior. Sessions end with concrete agreement on future action
items, which can be tested and evaluated. The next step is inter-group
sessions, where teams that have to work together -- line and staff,, accounting
and engineering, etc. -- "level" with each other on the problems between
them which cause conflict.
In the dramatic case which illustrates this discussion, the manager of
an advertising department of a large corporation, and his two, principal
assistants, discuss team-building with a personnel specialist. The two
assistants -- a man and a woman --bicker and put each other down, but
they and their boss are united in resisting any attempt to get them into
team-building sessions. How the personnel specialist gets them to change
their minds is the subject of the case.
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For RJase 2003/05/27: CIA-RDP84-00780R946000020039-5
FILM 5 .
CONFRONTING CONFLICT
(A Team-Building Demonstration Session with Sheldon Davis)
Taking off from the case in the previous film, the three top people in the
advertising department embark on their first team-building session, with
Sheldon Davis acting as the professional consultant. Although considerably
edited from the original version of this extemporaneous session, which
lasted three hours in front of the cameras, viewers of this film can get a
real understanding of team building as it is actually practiced -- so when
they try it themselves they will have the feeling of having "been there before."
Shel Davis' "to camera" comments help the viewer see the conflict
through the eyes of an impartial observer; at the same time getting a deeper
appreciation for the reasons for success and failure in this type of confrontation.
There is no better way of becoming thoroughly acquainted with this technique
which may well be the way all management people will solve their future
"people" problems.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For Rejpese 2003/05/27 : CIA-RDP84-00780RG"000020039-5
BIOGRAPHIES
SAUL W. GELLERMAN
The producer of this film series is Saul W. Gellerman.
He is President, Gellerman Kay Corporation, with offices in
Harrington Park, N. J. and Marblehead, Mass. He previously
served IBM Corp. in various behavioral research and manage-
ment capacities, 1959-1967, most recently as Executive
Research Consultant. He authored Motivation and Productivity
(1963) and Management by Motivation (1968) for the American
Management Association and has also written Management of
Human Relations (1966) and People, Problems and Profits
(1960). He also produced the Motivation and Productivity Film
Series for BNA Films, Inc. His Ph. D. is from the University
of Pennsylvania.
DOUGLAS W. BRAY
Douglas W. Bray is Director of Personnel Research at
American Telephone and Telegraph Company, having served
in other personnel research capacities with his company since
1956. Along with William C. Byham, he has developed materials
used in assessment centers for the early identification of manage-
ment potential. Through his efforts the assessment center
program has been extended throughout AT&T. He is Chairman
of the American Psychological Association Committee on the
Practice of Psychology in Industry, and Fellow, American
Psychological Association, Division of Industrial Psychology,
and Division of Personality and Social Psychology. He is the
author of numerous articles on the national supply of talent,
vocational and educational guidance, and personnel testing and
assessment. He has written Issues in the Study of Talent and
co-authored Effecting Change in Large Organizations, The
Uneducated, and The Ineffective Soldier. He holds a Ph. D.
from Yale in Psychology.
Approved For Release 2003/05/27 : CIA-RDP84-0078OR005000020039-5
 Approved For Rase 2003/05/27 : CIA-RDP84-00780RG 1000020039-5
ALFRED MARROW
Alfred J. Marrow is Director of Research and Chairman
.of the Board, Harwood Companies, Inc. One of the very few
business executives with a Ph.D. in Psychology, he has been
especially active in the application of behavioral science
knowledge to practical business problems. He is the author
of eight widely-read books published in ten languages and
over 75 articles, has been guest lecturer at more than forty
universities, and serves as board member, or chairman, of
ten research institutes and universities. His work in the
applied fields includes appointments by former Mayor Wagner
of New York as City Commissioner of Human Rights; and by
former Secretary of State Dean Rusk as Advisor to the
Department of State. He is also President, American Board
of Professional Psychology which conducts exams and grants
diplomas to superior pra.cticioners in clinical, counseling,
school industrial and organization psychology in the U. S.
and Canada. He is the holder of the Kurt Lewin Award, the
highest honor in the field of social psychology.
EMANUEL KAY
Emanuel Kay is Vice President, Gellerman Kay Corporation.
Previously, he served General Electric Company in various
behavioral research and management capacities (1958-69), most
recently as a divisional Employee Relations Manager. While
at G. E. he was Field Director, Performance Appraisal Study,
and co-authored, "Split Roles in Performance Appraisal, "
Harvard Business Review, 1965. Two of his articles have appeared
in Innovation: "How Good Is He? " (June 1969), an analysis of
performance appraisal; and "Work Needn't Turn People Off, "
an examination of mid-career problems (September 1971). He
has taught at M. I. T. (Sloan School of Management) and Carnegie
Mellon University. His Ph. D. is from Carnegie Mellon University.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5
 Approved For Rase 2003/05/27 : CIA-RDP84-00780RIW000020039-5
SIiELDON A. DAVIS
Sheldon A. Davis is vice president (since 1968) and Director
of Industrial Relations (since 1965) of the Systems Group of TRW
Inc. , Redondo Beach, California, an aerospace company.
He is responsible for the personnel management functions
for the Systems Group's more than 10, 000 employees in 36
locations throughout the U. S. and in three foreign countries.
He has served in a variety of industrial relations and administrative
positions since joining TRW in 1956, and is a member of the
TRW Inc Personnel Policy Planning Group.
A frequent university guest lecturer, he earned a M.B.A.
from Harvard Graduate School in 1952 after graduating cum laude
from the Boston University School of Public Relations. He has
served as a member of a Visiting Committee to the Doctoral.
Program in Behavioral Science at Case Western University,
a consultant to the State Department, and a member of the Organization
Development Advisory Council of the National Association of
Manufacturers. He currently is a Fellow of the National
Training Laboratories, Institute for Applied Behavioral.Science
and is a visiting staff member to numerous UCLA programs,
including the Learning Community in Organization Development
in the Graduate School of Business Administration. He has
autliored several articles on organization change.
Approved For Release 2003/05/27 : CIA-RDP84-00780R005000020039-5