Improving Employee Performance through Expectancy Theory

Expectancy Theory postulates that a person will act in a certain way and make particular decisions based upon what they expect the results to be.  Managers that desire to better understand how to motivate employees should explore expectancy theory and its practical use to boost performance. The theory has been used in a number of companies and situations with great success. It is such a popular theory that additional theories have been developed off of its seminal findings.

Victor Vroom indicated in his 1968 ground breaking research that motivation can be fostered when employers ensure that rewards are desired and tied directly to performance. His research showed through a number of cases studies and experimental approaches that workers will perform better when rewards are of significant value to employees. When the association of effort and reward is too distant employees may have a hard time making the connection and putting forward effort. 

The Theory takes into account three main concepts that include expectancy, instrumentality and valence. Expectancy is an employee’s belief that additional effort will lead to higher levels of performance, instrumentality is an employee’s belief that engaging in certain behaviors will result in a reward, and valence is value of that reward to the employees. Understanding how the formula works helps decision makers use policies, procedures, leadership skills, compensation and succession planning as methods of raising overall motivation.

Motivation = Valence X Expectancy (Instrumentality) 

Let us put this to an applied example. Bob is an employee who has high self-esteem but has been suffering from an inability to find a pathway to perform higher because the old manager believed that “having a job” was reward enough. Bob is not stupid so he performs at a level comparable to his co-workers so that he can keep the only reward the workplace is offering “a job” but doesn’t put any more effort forward because there are no other rewards to achieve (praise, recognition, compensation, promotion, etc…)  Is Bob doomed to mediocre performance?

The company’s costs have been expanding causing profits to plummet. The board of directors decides that new management is necessary to achieve results. This new manager begins to adjust the compensation structure, opportunities for promotion, and the ability of employees to influence their workplace. Bob’s performance increases because he believes that he has the ability to perform better (expectancy), trusts his new manager enough to believe that his performance will be appropriately (instrumentality), and finds the rewards of worthwhile value to motivate him (valence). 

The great news is that it isn’t only Bob’s performance that rises but also members of his team who see Bob receiving rewards. They begin to adjust their behavior in emulation of Bobs so as to receive similar benefits. Overtime, the new changes by the manager and the development of employee performance expectations become embedded into the culture raising standards and profits. 

Before an organization decides to throw money into their employee’s hands in the hope they will perform better, managers should be aware that there are many factors that contribute to the success of Vroom’s Expectancy Theory. Each component should be measured in multiple ways to determine precisely where the problems and de-motivators reside within the organization.  Employees must have the skills to perform better, believe they can perform better, and the right organizational factors to encourage motivated behavior. The person, environment, and the organizational design should align to make higher levels of performance possible.  It is a process of continuous improvement.

Vroom, V. (1964). Work and motivation. New York: Wiley. 

Kinicki, A. & Kreitner, R. (2009). Organizational behavior: key concepts, skills, and best practices (Fourth Edition). USA: McGraw-Hill Company, Inc.

The Leading Theories of Employee Motivation

Job motivation spawns from a variety of employee interests and desires. Motivation comes from the personal desires of the individual but is fostered through organizational pathways. There are many different ways of defining motivation but often motivation includes all reasons why a person chooses to act in a certain manner (Adair, 2006). The most common theories offer some level of insight into motivational factors that lead to higher levels of performance.

It is often beneficial to view these various common motivational theories to see a wider picture of the running vantage points and approaches to understanding employees behavior. Each motivational theory has their own particular approach that ranges from group dynamics to fulfillment of lifelong needs. Some are psychological by nature while others look at the organization and its environment as factors.

Maslow Hierarchy of Needs: Through this theory the needs of individuals progress through different stages based upon their development. People move through physiological needs, security and safety, social needs, self-esteem and self-actualization. As each person accomplishes some need the next one takes precedence.

Frederick Herzberg's Two Factors Theory: In this theory there are primarily two factors of satisfied and dissatisfied. Satisfaction often came through the context of work functions while dissatisfaction was often a result of the organizational dynamics. Motivation came through the execution of work tasks while the organizational factors were seen as context.

Theory X and Theory Y: In such a theory the X employee has a low level of motivation and the Y is engaged in the work task. The X employee does not feel as though the should make particular demands on them while the Y employee feels that such demands are a normal part of work life. X employee must often be coerced while Y employees have a more natural tendency to engage the work tasks.

The Expectancy Theory: Developed by Vroom (1964) and Porter & Lawler (1968) as a way of understanding individual motivations within the workplace. According to the theory each employee has expectancies of their work environment. When the expectancies are in match with work performance and clear rewards from the environment the employee will create motivation.

The Goal Setting Theory: The theory helps explain that setting goals and having appropriate feedback creates higher levels of motivation (Latham and Locke, 1979). Organizations can partner with individuals to help them set goals that are acceptable to the company and continue to give them accurate performance feedback throughout employees fulfillment of these desires.

Equity Theory: The equity theory indicates that motivation is a result of how people are treated when compared to others. In this theory people are more motivated when there is a perception of fairness and just treatment of everyone.

The Group Culture Theory: It is important to consider the factors that motivate an entire group that may have needs which are distinctly different from those of the individual. Under this theory the personality of a group and their needs should be considered as a motivational factor (Adair, 2006).


Adair, J. (2006). Leadership and motivation. The fifty-fifty rule and the eight key principles of motivating others. Kogan Page, London and Philadelphia.

Latham, G. P., & Locke, E.A.  (1979), Goal-setting:  A motivational technique that works. Organizational Dynamics, 8 (2):  68-80.

Porter, L. & Lawler, E. (1968). Managerial Attitudes and Performance. Homewood, IL: Richard D. Irwin, Inc.

Vroom, V. (1964) Work and Motivation. New York: McGraw Hill.