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Traditionally, managers assumed people were lazy and would not work unless strictly controlled. McGregor, however, believed this form of management to be based on faulty assumptions about human nature, and felt that managers should reflect on their assumptions about what motivates people. He proposed they draw on research in psychology and the other social sciences to create working conditions that allow all employees to realize their full human potential.

US psychologist Abraham Maslow's 1943 essay "A Theory of Human Motivation" established his idea of humanistic psychology as a "third force" in the field. He outlined a new approach to understanding the mind, saying humans are motivated by their need to satisfy a series of hierarchical needs, starting with the most essential first. He thought it important for the advancement of psychology to identify, group, and rank them in terms of priority.