Understanding Equity, Expectancy Theories & Organizational Culture

Posted on Apr 5, 2025 in Psychology and Sociology

Adam’s Equity Theory

Adam’s Equity Theory posits that perceived inequity plays a major role in motivational processes.

  1. People exchange inputs for outputs.
  2. People have a natural tendency to compare themselves to one another.
  3. The nature of the comparison is between input-output ratios, as follows:

Inputs of employee / Outputs of employee versus Inputs of referent other / Outputs of referent other

  1. If the comparison of the input-output ratio seems in balance, equilibrium, or equity, then behavior will be maintained.
  2. If the comparison of the input-output ratio seems unequal or inequitable, then there will be a strong motivation force to reestablish equilibrium.

Note: To restore equilibrium, consider changing work inputs, outputs, work outputs of a referent other, comparison, and the situation.

Vroom’s Expectancy Theory

  • Expectancy (E): An employee’s belief that working hard will result in a desired level of task performance being achieved.
  • Instrumentality (I): An employee’s belief that successful performance will be followed by rewards and other desirable outcomes.
  • Valence (V): The value an employee assigns to the possible rewards and other work-related outcomes.

Vroom summarized that in order for motivation to be present, expectancy, instrumentality, and valence must all be present at the same time. In other words:

Motivation = E * I * V

If any of the three expectancy factors were missing, zero motivation would be present.

Organizational Culture

Organizational Culture: Culture refers to something that is more stable and enduring than climate, and it is more difficult to define and evaluate.

Organizational Climate

Organizational Climate: Climate typically refers to people’s attitudes and how they feel about the organization.

Culture generally refers to organizational rules and beliefs that are relatively enduring and resistant to change, whereas climate is used to describe characteristics that are temporary and capable of being changed.

Levels of Organizational Culture Analysis

  • Cultural Artifacts: Tangible aspects of culture (the behaviors, language, and physical symbols) that we can perceive with our senses and that reflect the rules and core beliefs of the organization’s culture.
  • Shared Norms: Key norms can often be determined by the degree of consistency in how group members act.
  • Cultural Values: Represent the collective beliefs, ideals, and feelings of members about the things that are good, proper, valuable, rational, and right (statements of corporate values or management philosophy).
  • Shared Assumptions: Provide a foundation for how people think about what happens in organizations.

Forces to Maintain Organizational Culture

  1. The selection and retention of employees: The recruitment and selection procedures in a company are designed to identify not just the specific skills and talents of job applicants, but also their personalities and interests. The organization then maintains its culture by disciplining or even terminating employees who consistently deviate from accepted norms and practices.
  2. The allocation of rewards and status: The rewards and punishments attached to various behaviors convey to employees the priorities and values of both individual managers and the organization.
  3. The reactions of leaders: Administrators perform a variety of symbolic activities that influence the power relationships in organizations. Ex: Spend time on activities that are important, change or enhance the setting, review and interpret history, establish a dominant value expressed in a simple phrase.
  4. The rites and ceremonies: Rites and ceremonies provide opportunities to reward and recognize employees whose behavior is congruent with the values of the company (Rites of passage, Rites of enhancement, Rites of renewal, Rites of integration, Rites of conflict reduction, Rites of degradation).
  5. The stories and symbols: Stories are important because they preserve the primary values of the organization and promote a shared understanding among all employees. A symbol is something that represents something else.
  6. The reactions to crises: The way in which a crisis is handled can either reinforce the existing culture or generate new values and norms that change the culture in some way.