The Hard Approach and Soft Approach in MBA

Under Theory X, management approaches to motivation range from a hard approach to a soft approach. The hard approach to motivation relies on coercion, implicit threats, micromanagement, and tight controls -- essentially an environment of command and control. The soft approach, however, is to be permissive and seek harmony in the hopes that, in return, employees will cooperate when asked. However, neither of these extremes is optimal. The hard approach results in hostility, purposely low-output, and extreme union demands. The soft approach results in increasing desire for greater reward in exchange for diminishing work output.
It would appear that the optimal approach to human resource management would be lie somewhere between these extremes. However, McGregor asserts that neither approach is appropriate since the foundations of theory x are incorrect.