A founding faculty member of MIT's Sloan School of Management, McGregor wrote "The Human Side of Enterprise," a 1960 business book that changed the way managers see - and treat - their workers.
The core insight of McGregor's book was one that took an optimistic view of the office worker's nature, as opposed to the beliefs held by previous management guru Frederick Taylor.
Taylor believed that workers were inherently lazy and would do everything in their power to avoid getting things done, unless they were threatened and punished by managers.
By contrast, McGregor laid out the two ways managers could think about their employees: the Taylor-inspired Theory X and the more optimal Theory Y.
Where Theory X managers felt they needed to constantly supervise and manipulate workers to get things done, McGregor suggested that Theory Y managers should instead operate under the belief that most employees actually want to take pleasure in their work.
Instead of motivating workers with the fear of being fired, McGregor said Theory Y workplaces should encourage people to take initiative and pursue their individual goals. He reasoned that allowing employees to fulfill their psychological needs would ultimately make them capable of accomplishing more for their companies.
In his book, "Cubed: A Secret History of the Workplace," author Nikil Saval writes that that "The Human Side of Enterprise" was "one of the most discussed and influential books of the 1960s," inspiring managers everywhere to push their workers to pursue self-actualization alongside the goals of the company.
Today, Theory Y can be seen in companies that trust their self-directed employees to get their work done after a round of ping-pong and in worker-friendly policies like Google's famed "20% time."