Various studies such as Dewhurst, Guthridge, and Mohr, (2011) conclude that an adequate reward

system is critical for employee motivation both for high achievers and low achievers. This is because
rewards increase the job satisfaction among high performers and act as an incentive for low performers.
The systems may vary in different organisations because of workforce personalities, backgrounds and
preferences, hence, all reward systems have the same objective to motivate employees for continuous
improvement, personal development and professional growth. Another research, conducted by Shields
and associates (2015), stands for the fact that any reward system should be created based on the needs
and preferences of employees as someone’s needs may be fulfilled by monetary rewards while others
are searching for promotion, appreciation, increase of responsibilities, trainings and other types of non-
monetary rewards. An efficient re-ward system should be flexible and contain both monetary and non-
monetary rewards to meet the expectations of all employees.

Expectancy theory has some important implications for motivating employees. The model provides
guidelines for enhancing employee motivation by altering the individual’s effort-to-performance
expectancy, performance-to-reward expectancy, and reward valences. Several practical implications of
expectancy theory are described next (Greenberg, 2011; Hellriegel & Slocum, 2011; McShane & Von
Glinow, 2011; Nadler & Lawler, 1983).

Expectancy theory pertains to the process in which an individual’s motivational force underlying a
course of action or goal is determined by a series of judgements regarding the (1) valence, (2)
instrumentality, and (3) expectancy associated with the action. Valence refers to the intensity of feelings
an individual has in respect to a given outcome associated with the action. For instance, is the outcome
seen as desirable or attractive to the employee? Instrumentality is the belief that a given quality or
quantity of performance or a behavior will lead to the desired outcome, whether it is a reward,
recognition, or some other result. Expectancy refers to the belief that the individual can effectively
perform the behavior if they expend the effort. The subjective evaluation of these three facets is posited
to interact to result in the motivational force in a multiplicative fashion (i.e., Motivation = Valence *
Instrumentality * Expectancy). Therefore, if any of the components equal zero, the motivational force
would be missing.

Expectancy theory has some important implications for motivating employees.The model provides
guidelines for enhancing employee motivation by altering the individual’s effort-to-performance
expectancy, performance-to-reward expectancy, and reward valences. Several practical implications of
expectancy theory are described next (Greenberg, 2011; Hellriegel & Slocum, 2011; McShane & Von
Glinow, 2011;