Managing for Competitive Advantage (part 17)

Performance-Related Beliefs

 by

 Charles Lamson

Reinforcement theory describes processes by which factors in the work environment affect people's behavior. Expectancy theory adds to that some of the cognitive processes that go on in people's heads. According to expectancy theory, the person's work efforts lead to some level of performance. Then performance results in one or more outcomes for the person (see Figure 1). People develop two important beliefs linking these three events: expectancy, which links effort to performance, and instrumentality, which links performance to outcomes.

FIGURE 1 Basic Concepts of Expectancy Theory

The Effort-to-Performance Link

The first belief, expectancy, is people's perceived likelihood that their efforts will enable them to attain their performance goals. An expectancy can be high (up to 100 percent), such as when a student is confident that if she studies hard she can get a good grade on the final. An expectancy can also be low (down to a 0 percent likelihood), such as when a suitor is convinced that his dream date will never go out with him.

All else equal, high expectancies create higher motivation than do low expectancies. In the preceding examples, the student is more likely to study for the exam than the suitor is to pursue the dream date, even though both want their respective outcomes.

Expectancies can vary among individuals, even in the same situation. For example, a sales manager might initiate a competition in which the top salesperson wins a free trip to Hawaii. In such cases, the few top people, who have performed well in the past, will be more motivated by the contest than will the historically average and below-average performers. The top people will have higher expectancies---stronger beliefs that their efforts can help them turn in the top performance.

The Performance-to-Outcome Link 

The example about the sales contest illustrates how performance results and some kind of outcome, or consequences, for the person. Actually, it often results in several outcomes. For example, turning in the best sales performance could lead to (1) a competitive victory, (2) the free trip to Hawaii, (3) feelings of achievement, (4) recognition from the boss, (5) prestige throughout the company, and (6) resentment from other salespeople.

But how certain is it that performance will result in all of those outcomes? Will winning the contest really lead to resentment? For that matter, will it really lead to increased prestige?

These questions address the second key belief described by expectancy theory: instrumentality. Instrumentality is the perceived likelihood that performance will be followed by a particular outcome. Like expectancies, instrumentalities can be high (up to 100 percent) or low (approaching 0 percent).

Also, each outcome has an associated valence. Valence is the value the outcome holds for the person contemplating it. Valances can be positive (up to 1.0, in the theory's mathematical formulation), like the Hawaiian vacation, or negative (down to -1.0), like the other sales people's resentment.

Impact on Motivation

For motivation to be high, expectancy, instrumentality, and total valence of all outcomes must all be high. A person will not be highly motivated if any of the following conditions exist:

1. He believes he can't perform well enough to achieve the positive outcomes that he knows the company provides to good performers (high valence and high instrumentality but low expectancy).
2.  He knows he can do the job, and is fairly certain what the ultimate outcomes will be (say, a promotion and a transfer). However, he doesn't want those outcomes or believes other, negative outcomes outweigh the positive (high expectancy and high instrumentality but low valance).
3.  He knows he can do the job, and wants several important outcomes (a favorable performance review, a raise, and a promotion). But he believes that no matter how well he performs, the outcome will not be forthcoming (high expectancy and positive valances but low instrumentality).

Managerial Implications of Expectancy Theory

Expectancy theory helps the manager zero in on key leverage points for influencing motivation. Three implications are crucial:

1. Increase expectancies. Provide a work environment that facilitates good performance, and set realistically attainable performance goals. Provide training, support, and encouragement so that people are confident and can perform at the levels expected of them. Charismatic leaders excel at boosting their followers' confidence.
2.  Identify positively valent outcomes. Understand what people want to get out of work. Think about what their jobs provide them and what is not, but could be, provided. Consider how people may differ in the valances they assign to outcomes. Know the need theories of motivation, described in the next post, and their implications for identifying important outcomes.
3.  Make performance instrumental toward positive outcomes. Make sure that good performance is followed by personal recognition and praise, favorable performance reviews, pay increases, and other positive results. Also, make sure that working hard and doing things well will have as few negative results as possible. It is useful to realize, too, that bosses usually provide or withhold rewards, but others do so as well, including peers, direct reports, consumers, and others.

*SOURCE: MANAGEMENT: THE NEW COMPETITIVE LANDSCAPE, 6TH ED., 2004, THOMAS S. BATEMAN & SCOTT A. SNELL, PGS. 401-404*

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