Master Thesis Organisation Studies

62 Pages·2011·1.55 MB·English

Master Thesis Organisation Studies

A quantitative study on Transformational Leadership, Cross-Cultural Awareness
and Task Interdependence in Virtual Teams

Karin In der Maur
June, 2011

Tilburg University: Faculty of Social and Behavioural Sciences
Department of Organization Studies
Master Circle 10: Leadership and Coordination in Distributed Teams

Details of student: Karin In der Maur
ANR: 824430

Names of the Supervisors: Name supervisor 1: Prof. Dr. M.J.M. Vermeulen
Name supervisor 2: MSc. K.E. de Ries
Second reader: Dr. J.P. de Jong
Abstract

A quantitative study on Transformational Leadership, Cross-Cultural Awareness
and Task Interdependence in Virtual Teams

Karin In der Maur
Tilburg University, 2011

This research provides insight into the relationship between transformational leadership, cross-
cultural awareness and task interdependence in virtual teams. Virtual teams became more common
in organizations and virtual team leaders have to deal with other complexities than leaders in
conventional teams. One of these complexities is that members of virtual teams often have different
cultural backgrounds due to their geographical distance. This can result in creative solution solving
but can also lead to miscommunication and conflict instead. Therefore, this study suggested that it is
important that leaders effectively deal with these cultural differences by stimulating cross-cultural
awareness in order to enhance team effectiveness. Furthermore, task interdependence has been
included in this research because prior research showed the implications of it on group structure and
processes. The following research question was formulated: To what extent 1) is transformational
leadership related to the effectiveness of virtual teams, 2) is this relationship mediated by cross-
cultural awareness, and 3) is the association of cross-cultural awareness with team effectiveness
moderated by task interdependence? The research has a cross-sectional design and data is gathered
through questionnaires conducted in 18 global virtual teams (145 members and 18 leaders) of 10
different multinationals. Multiple regression analyses are conducted on team as well as on individual-
level. The results provided support for the positive influence of transformational leaders on the
effectiveness of virtual teams. The mediating role of cross-cultural awareness on the association of
transformational leadership with team effectiveness is not supported, though individual-level
analyses indicate that cross-cultural awareness can be influenced by transformational leaders and
that it has an effect on team effectiveness as well. The moderating role of task interdependence on
the association of cross-cultural awareness with team effectiveness is not supported. Hence, a direct
relationship between task interdependence and team effectiveness has been detected.

Keywords: virtual teams, transformational leadership, team effectiveness, cross-cultural awareness,
task interdependence

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Preface

This report is the result of a research conducted for my master thesis for Organisation Studies at
Tilburg University. In the preface I will elaborate on my choice for the research subject. Furthermore,
I would like to grab this opportunity to thank some people.

My previous education, the Hotel Management School in Maastricht, did not satisfy me enough and
when I finished it I decided to search for a greater intellectual challenge. Therefore, I started the
premaster Organisation Studies at Tilburg University two years ago and I must admit that the past
two years definitely gave me the challenge I searched for. My passion about other cultures, including
their habits, ways of working and views on the world, started with my traineeship in 2006 in Malaysia
and grew during my international experiences later on. This fascination for other cultures influenced
my decision for a circle and topic for my thesis; I wanted to do something within an international
context. In the track ‘Leadership in Distributed Teams’ I have been able to combine this personal
interest with a very interesting, upcoming phenomenon within organisations, called virtual teams.

I enjoyed doing this research, though it has not always been that easy. Especially the acquisition of
global virtual teams turned out to be very hard and has cost a tremendous amount of effort. Also the
several analyses were brain-racking here and there. Overall I can say that I went through a great
learning experience.

Finally, I would like to thank several persons who were involved in writing this thesis. I would like to
start by thanking my supervisors, Joris de Rooij, who unfortunately had to leave after finishing my
Individual Research Proposal (IRP), Marc Vermeulen and Kirsten de Ries for their guidance through
the whole process. Furthermore, I would like to thank Jeroen de Jong for his comments during the
defences, both the IRP and thesis defence. I also would like to thank my fellow students, with special
thanks to Malou Lambregts with whom I have visited a lot of organizations and Imke Verheij, for the
pleasant collaboration. Moreover, I am thankful to all participating teams and their members. As
mentioned before, it has been very tough to gather data so their effort is even more appreciated.
Last but not least I would like to thank my family and boyfriend for their infinite support.

I hope you will enjoy reading this thesis and that it is satisfying for all of you.

Karin In der Maur
June, 2011

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Table of Content

Abstract ............................................................................................................................................ 2
Preface ............................................................................................................................................. 3

1. Research introduction .................................................................................................................... 6
1.1 Research problem .............................................................................................................................. 6
1.2 Aim and research question ................................................................................................................ 8
1.3 Relevance ........................................................................................................................................... 8
1.4 Structure of this paper ....................................................................................................................... 9

2. Theoretical framework ................................................................................................................ 10
2.1 Virtual teams .................................................................................................................................... 10
2.2 Team effectiveness........................................................................................................................... 11
2.3 Leadership ........................................................................................................................................ 12
2.4 Cross-cultural awareness ................................................................................................................. 14
2.5 Task interdependence ...................................................................................................................... 16
2.6 Conceptual model ............................................................................................................................ 17

3. Methodological framework .......................................................................................................... 18
3.1 Research design ................................................................................................................................ 18
3.2 Sample strategy ................................................................................................................................ 18
3.3 Data collection.................................................................................................................................. 19
3.4 Measurements ................................................................................................................................. 20
3.5 Data analysis ..................................................................................................................................... 22
3.6 Research quality indicators .............................................................................................................. 24

4. Results ........................................................................................................................................ 26
4.1 Preliminary analysis .......................................................................................................................... 26
4.2 Factor analysis and scale reliability .................................................................................................. 26
4.3 Data aggregation .............................................................................................................................. 28
4.4 Descriptive statistics ......................................................................................................................... 29

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4.5 Regression analysis ........................................................................................................................... 30
4.5.1 Assumptions ............................................................................................................................ 30
4.5.2 Team-level analysis .................................................................................................................. 32
4.5.3 Individual-level analysis ........................................................................................................... 34

5. Conclusion ................................................................................................................................... 37

6. Discussion ................................................................................................................................... 38
6.1 Theoretical implications ................................................................................................................... 38
6.2 Reflection upon the measurements and analyses ........................................................................... 40
6.3 Limitations and recommendations for future research ................................................................... 42
6.4 Managerial implications ................................................................................................................... 44

Literature references ....................................................................................................................... 45
Appendices ..................................................................................................................................... 48
Appendix A: Invitation questionnaire .................................................................................................... 49
Appendix B: Reminder questionnaire .................................................................................................... 50
Appendix C: Questionnaire .................................................................................................................... 51
Appendix D: Logbook data gathering ..................................................................................................... 60
Appendix E: Characteristics of the participating organizations and teams ........................................... 61
Appendix F: Individual-Level Descriptive Statistics and Intercorrelations ............................................. 62

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1. Research introduction

This chapter provides further details about the context of this research. The research problem is
outlined and furthermore the aim of the research, the research question and the relevance of this
research will be discussed. Finally, the structure of this paper will be presented.
1.1 Research problem
Many organizations have responded to globalization, technological innovations and rapid changing
customer needs by introducing virtual teams (Bell & Kozlowski, 2002; Hertel, Geister & Konradt,
2005). Virtual teams are "teams whose members use technology to varying degrees in working
across locational, temporal, and relational boundaries to accomplish an interdependent task"
(Martins, Gilson & Maynard, 2004, p. 808). Due to Information and Communication Technology (ICT)
geographical flexibility of organizations is increased which makes it possible to bring the most
qualified individuals together, regardless of their location (Bell & Kozlowski, 2002).

Prior research stated that leadership is an important factor for enhancing team effectiveness in
virtual teams (e.g. Kayworth & Leidner, 2000). Nevertheless, scholars just started to understand
leadership in virtual teams and more research is required (Kahai, Fjermestad, Zhang & Avolio, 2007).
Leaders in virtual teams have to deal with other complexities than leaders in conventional (face-to-
face) teams and they have to learn to manage these complexities in order to improve team
effectiveness (Kayworth & Leidner, 2002). One of these complexities is that members in virtual teams
often have different cultural backgrounds (Hertel et al., 2005) and have therefore greater
management challenges than conventional teams (McDonough, Kahn & Barczak, 2001). According to
Hertel et al. (2005), leaders are not able to choose cultural diversity and therefore recommendations
how to deal with these differences are required.

Prior research indicated that cultural differences within virtual teams can have both positive and
negative influences on team effectiveness. Culturally diverse virtual teams may perform better than
teams with members from the same culture because of their ability to solve problems with creative
solutions (Davis & Bryant, 2003) and their greater variety of perspectives (Kayworth & Leidner, 2000).
“However, restricted communication opportunities in virtual teams might prevent a constructive use
of diversity and might rather increase misunderstandings and conflicts” (Hertel et al., 2005, p. 75).
Miscommunication can also be caused because of the different assumptions, ways of working and
views of the world that culturally diverse members have (Kayworth & Leidner, 2000; Shachaf, 2008).
Culturally diverse team members “filter information through their cultural lenses” (Kayworth &

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Leidner, 2000, p. 187) which may result in communication difficulties and misunderstandings (Davis
& Bryant, 2003). These different perspectives can also hinder the decision making process
(Maznevski & Chudoba, 2000) and it may be harder to create cohesion and to build trust
(McDonough et al., 2001). In the research of Davis and Bryant (2003), cultural conflicts diminished
team effectiveness, satisfaction and commitment. Lee-Kelley and Sankey (2008) stated that
especially cultural differences influence relationships between virtual team members. Therefore, it is
important to overcome problems that might arise when individuals with different cultural
backgrounds work together in virtual teams in order to optimize team effectiveness.

According to Connaughton and Shuffler (2007) virtual teams will be effective “as long as individuals
learn the cultural logic of others’ divergent beliefs” (p. 396). Their vision has been shared with other
scholars who argue that awareness to other cultures is a critical success factor in virtual teams
(Kayworth & Leidner, 2000; Blackburn, Furst & Rosen, 2003). Cross-cultural awareness has also been
an important focus of training programs to prepare people to cooperate with people with different
cultural backgrounds (Cox & Blake, 1991). Because of the culturally diverse team members in global
virtual teams, cross-cultural awareness seems to be an important concept in the context of these
teams. Additionally, Kayworth and Leidner (2000) found that it is important to undertake a strategy
to build cross-cultural awareness among team members to overcome culture barriers and to
stimulate cooperation in order to optimize team performance. Because of the central role that a
leader possesses in a team, it seems logic to reason that leaders play an important role in
undertaking these strategies. Leaders can facilitate the learning about different cultures within the
team (Huang, Kahai & Jestice, 2010).

Cross-cultural awareness deals with relationships among team members and “an important
determinant of the quality of interpersonal interaction” is the extent to which team members are
interdependent from each other (Van der Vegt & Janssen, 2003, p. 731). Within every team a certain
level of task interdependence is required which has an impact on the structure and processes of the
virtual team (Bell & Kozlowski, 2002). High levels of task interdependence within a team require
team members to interact and cooperate more frequently with each other, compared to teams with
low task interdependence (Mitchell & Silver, 1990). When team members need to cooperate and
communicate more often with each other, cross-cultural awareness within the team seems to be
more important.

Therefore, this research will focus on the relationship of leadership, team effectiveness, cross-
cultural awareness and task interdependence.

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1.2 Aim and research question
The aim of this research is to provide more insight into the influence and role of transformational
leadership (only transformational leadership is incorporated in this research for the reasons provided
in subparagraph 2.3), cross-cultural awareness and task interdependence on the effectiveness of
virtual teams. By increasing our knowledge regarding the influence of, and the relationships between
these concepts, the functioning of virtual teams will be better understood.

Therefore, this research attempts to answer the following research question:
To what extent 1) is transformational leadership related to the effectiveness of virtual teams, 2) is
this relationship mediated by cross-cultural awareness, and 3) is the association of cross-cultural

awareness with team effectiveness moderated by task interdependence?

1.3 Relevance
The last ten years the literature regarding virtual teams has grown extensively. As mentioned before,
leadership has been an important factor for enhancing team effectiveness and more research is
required to better understand leadership within the context of virtual teams (Kahai et al., 2007;
Hambley, O’Neill & Kline, 2007a). Additionally, “there has been relatively few published field studies
that have examined leadership in a virtual team setting” (Kahai et al., 2007, p. 3) and “most of the
existing research on virtual team leadership consists of anecdotal case studies of virtual teams in
single organizations” (Hambley et al., 2007b, p. 41). Because leadership is an important aspect in this
research and data is gathered in virtual teams of multiple organizations, this research will extend the
existing amount of research regarding virtual team leadership. Furthermore, this research will extend
the virtual team literature by investigating cross-cultural awareness within these teams. Although
cross-cultural awareness is a known concept in cross-cultural settings, it has hardly been studied
before in research regarding virtual teams. Prior research stated that cultural diversity is an
important predictor of team effectiveness (Davis & Bryant, 2003). Nevertheless, there is a lack of
empirical findings that support this (Shachaf, 2008). Furthermore, Anawati and Craig (2006) argued
that virtual team research mainly focuses on the technological aspects of these work environments
and there is “a lack of research into the behavioural aspects and the issue of cultural differences in
particular” (p. 44). This research is an attempt to provide insight into some behavioural aspects by
extending the knowledge regarding the relation between transformational leadership, cross-cultural
awareness, task interdependence and team effectiveness within virtual teams.

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Besides the theoretical relevance, this research has a practical relevance as well. The use of virtual
teams within (large international) organizations has become prevalent (Connaughton & Shuffler,
2007). This research will provide better insight into the functioning of virtual teams and managerial
implications have been formulated which can help managers to optimize the performance of their
team(s).

1.4 Structure of this paper
This paper consists of six chapters. The second chapter presents the theoretical foundation of this
research, including the hypotheses and a conceptual model. Chapter three describes the methods
which are used to conduct the research. The results are presented in the fourth chapter and the fifth
chapter contains the conclusion of the research and provides an answer on the research question.
Finally, the last chapter discusses the results, reflect upon the measurements and analyses, provide
limitations of the research, formulate recommendations for future research and managerial
implications are presented. A rough outline of the structure of this paper can be found in figure 1.

Theoretical part Empirical part

Figure 1: Structure of paper

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2. Theoretical framework

This chapter describes the dependent and independent variables which are included in this research,
namely; team effectiveness, transformational leadership, cross-cultural awareness and task
interdependence. Furthermore, possible theoretical relations between the concepts are discussed
and a conceptual model is presented. In order to provide better insight in the phenomenon of virtual
teams, the next paragraph will start with an explanation of them.

2.1 Virtual teams
An extensive amount of definitions about virtual teams exist in the literature. Two examples,
additional to the one presented in the first chapter are; virtual teams are “groups of geographically,
organizationally and/or time dispersed workers brought together by information and
telecommunication technologies to accomplish one or more organizational tasks” (Powell, Piccoli &
Ives, 2004, p. 7) and “two or more individuals who use a mixture of communication and collaboration
technologies to interact interdependently across boundaries of organization, time and space to
achieve some common strategic purpose for their organization” (Davis & Bryant, 2003, p. 307). There
is no commonly agreed definition of virtual teams because they come in many forms (Curseu &
Wessel, 2005). Furthermore, because of the increased amount of literature on virtual teams, a lot of
virtual team definitions have been presented simultaneously (Martins et al., 2004). Nevertheless,
these definitions show quite some similarities and most of them include the same virtual team
attributes (Martins et al., 2004). According to Hertel et al. (2005), who made an attempt to
summarize these attributes, virtual teams consist of “(a) two or more persons who (b) collaborate
interactively to achieve common goals, while (c) at least one of the team members works at a
different location, organization, or at a different time so that (d) communication and coordination is
predominantly based on electronic communication media (email, fax, phone, video conference,
etc.)” (p. 71).

A distinctive type of a virtual team, which received a great amount of attention in the literature, is
the global virtual team (e.g. Maznevski & Chudoba, 2000; Davis & Bryant, 2003). Global virtual teams
consist of members who are culturally diverse because they work and live in several countries
around the globe (Powell et al., 2004) and differ from domestic teams which are teams consisting of
members from the same country (Davis & Bryant, 2003). According to Davis and Bryant (2003), global
virtual teams are harder to manage because the members are culturally diverse. Furthermore,
members are geographically separated and operate in different time zones (Davis & Bryant, 2003).
This research only gathered data in global virtual teams because the members of the virtual teams

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