Expectancy Theory in Practice Western Governors University Abstract The purpose of this paper is to illustrate the three main components of Expectancy Theory and how its practice will work in a real world situation. The paper will point out how a company can best use the components of the theory to make its employees more productive and reward them in a way that is most conducive to them each achieving their best results. Expectancy theory is a measure of motivation based on three major components. It is one of the most widely accepted theories of motivation based on evidence.

Although, there is no easy way to measure expectancy theory as each person has a differing reward system in mind, based on the majority of data people respond best to a reward system that matches closely to their personal goals. The three relationships that make up expectancy theory are: 1. Effort – Performance Relationship States that if a person puts out a certain amount of effort they will achieve a certain performance. 2. Performance – Reward Relationship This is based on a person’s belief that their performance will achieve a certain reward. . Rewards – Personal Goals Relationship This is how a companies offered rewards will satisfy a person’s personal goals with examples being promotions or pay raises. The primary factor determining ones production and desire to succeed is based on how closely a companies offered rewards for an employee’s performance will align with their personal goals. In other words if an employee plans to work 20 extra hours a week doing a certain task and they expect to earn a $10,000. 00 per year raise from that work yet the company instead offers only $5,0000. 0 per year that employees personal goals are not being met and the expectancy theory will show that employees production will most likely drop. In the illustration given the company would best model the expectancy theory of motivation by offering a larger reward for the highest producers. If the company can make a larger financial reward available to those meetings their goals then it would make their extra effort seem more meaningful to them and their personal goals would be met by the reward given. The other downfall o the rewards offered is the employees realization that simply working a little overtime is a bigger reward to them than increasing production. So to make that gap larger would also have the same effect on the employees and their production. Lastly, if those employees meeting goals are not earning a reward of value and they can see that those employees not making goals are not being punished then the reward is not enough for them to raise their own performance. If the company in our scenario would like to implement the expectancy theory in the plant and see production improve they could install a clear plan for all employees.

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The plan would set a work done versus pay raise scale, clearly written. It would have to be a raise high enough that would offset the difference in overtime paid, or eliminate the overtime pay for employees not reaching goal. An example could be that any employee reaching production goal for a pay period receives x number of dollars. If the employee does not reach production goal then they are not entitled to working overtime. This would give them a set goal and state clearly what they could expect in return for their improved production.