In 1964, Victor H. Vroom developed the Expectancy theory through his study of the motivations behind decision making.
Expectancy theory argues that the strength of a tendency to act in a certain way depends on the strength of an expectation that the act will be followed by a given outcome and on the attractiveness of that outcome to the individual.
Very simply, the expectancy theory says that an employee will be motivated to exert a high level of effort when he or she believes that:
- The effort will lead to a good performance appraisal.
- A good appraisal will lead to organizational rewards.
- The organizational rewards will satisfy his or her personal goals
The key to the expectancy theory is an understanding of an individual’s goals and the relationships between effort and performance, between performance and rewards, and finally, between the rewards and individual goal satisfaction. When an employee has a high level of expectancy and the reward is attractive, motivation is usually high.
The expectancy theory says that individuals have different sets of goals and can be motivated if they believe that:
- There is a positive correlation between efforts and performance,
- The favorable performance will result in a desirable reward,
- The reward will satisfy an important need,
- The desire to satisfy the need is strong enough to make the effort worthwhile Vroom introduces three variables within the expectancy theory which are valence (V) expectancy (E) and instrumentality (1). The three elements are important behind choosing one element over another because they are clearly defined: effort-performance expectancy (E>P expectancy), performance-outcome expectancy (P>0 expectancies).
Three components of Expectancy theory: Expectancy, Instrumentality, and Valence
- Expectancy: Effort—, Performance (E-P)
- Instrumentality: Performance–Outcome (P-0)
- Valence– V(R)
Expectancy: Effort Performance (E-4)
Expectancy is the belief that one’s effort (E) will result in attainment of desired performance (P) goals usually based on an individual’s past experience, self-confidence, and the perceived difficulty of the performance standard or goal. Factors associated with the individual’s Expectancy perception are —
- Goal difficulty and
Self-efficacy is the person’s belief in their ability to successfully perform a particular behavior. Goal difficulty happens when goals are set too high or performance expectations that are made too difficult are most likely to lead to low expectancy perceptions. Control is one’s perceived control over performance. In order for expectancy to be high, individuals must believe that they have some degree of control over the expected outcome.
Instrumentality: Performance Outcome (P-O)
Instrumentality is the belief that a person will receive a reward if the performance expectation is met. This reward may come in the form of a pay increase, promotion, recognition or sense of accomplishment. Instrumentality is low when the reward is given for all performances given.
actors associated with the individual’s instrumentality for outcomes are trust, control, and policies. If individuals trust their superiors, they are more likely to believe their leader’s promises. When there is a lack of trust in leadership, people often attempt to control the reward system. When individuals believe they have some kind of control over how, when, and why rewards are distributed. Instrumentality tends to increase. Formalized written policies impact the individuals’ instrumentality perceptions. Instrumentality is increased when formalized policies associates reward to performance.
Valence: the value the individual places on the rewards based on their needs, goals, values, and Sources of Motivation. Factors associated with the individual’s valence for outcomes are values, needs, goals, preferences, and Sources of Motivation Strength of an individual’s preference for a particular outcome.
The valence refers to the value the individual personally places on the rewards – 1→0→+1
-1= avoiding the outcome
0= indifferent to the outcome
+1= welcomes the outcome
In order for the valence to be positive, the person must prefer attaining the outcome to not attaining it.
Expectancy Theory of motivation can help managers understand how individuals make decisions regarding various behavioral alternatives. The model below shows the direction of motivation when behavior is energized:
Motivational Force (MF) = Expectancy × Instrumentality × Valence
When deciding among behavioral options, individuals select the option with the greatest motivational force (MF). Expectancy and instrumentality arc attitudes (cognitions) that represent an individual’s perception of the likelihood that effort will lead to performance that will lead to the desired outcomes. These perceptions represent the individual’s subjective reality, and may or may not bear a close resemblance to actual probabilities. These perceptions are tempered by the individual’s experiences (learning theory), observations of others (social learning theory), and self-perceptions. ‘Valence is rooted in an -individual’s value system.