What is Expectancy Theory?

Vroom's Expectancy Theory says that individuals act when they expect positive results from their actions. Without the hope of a reward, it is less likely that individuals will exert the highest level of effort. As such, individual choose their actions based upon the expected outcome of those actions. 

Expectancy theory contributes to the understanding of motivation. An individual's expectations are affected by the certainty they feel that their actions will result in their expected reward or goal. There is an immediate relationship between exertion and accomplishment.

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How does Expectancy Theory Work?

Expectancy theory was proposed by Victor Vroom in the 1960s. This theory states that individual motivation with regard to the amount of effort expended is a result of a rational calculation. There is a link between the type and amount of effort invested and the amount and type of reward received. The elements of the expectancy theory are as follows:

• Expectancy - Whether a person believes that high levels of effort will lead to the desired outcomes or performance. If something other than the amount of effort contributes to achieving the outcome, then this will cause a lack of motivation.
• Instrumentality - To what degree is the level of performance related to the reward received? For example, lots of work may not increase the likelihood of a given result. Make certain that the indicated reward is measured and explicitly tied to the level of performance.
• Valence - What is the value of the rewards that result from the performance? Understand what type of reward employee values.

Managers can motivate employees by understanding and modifying the scenario such that the amount of effort will relate directly to the amount of reward received and that the reward received is valued by the employee. The theory is often criticized for being too idealistic - assuming that all individuals are rational actors making affirmative decisions concerning the rewards received from their efforts.