Top Executives? Work Relationship and Work-Family Balance: Taxonomy Development and Performance ImplicationsTaxonomy Development and Performance ... Development and Performance Implic

Eva-Maria Bauer Top Executives’ Work Relationship and Work-Family Balance

GABLER RESEARCH Neue Perspektiven der marktorientierten Unternehmensführung Herausgegeben von Professor Dr. Ruth Stock-Homburg, Technische Universität Darmstadt Professor Dr. Jan Wieseke, Ruhr-Universität Bochum

Eva-Maria Bauer

Top Executives’ Work Relationship and Work-Family Balance Taxonomy Development and Performance Implications With a foreword by Prof. Dr. Ruth Stock-Homburg

RESEARCH

Bibliographic information published by the Deutsche Nationalbibliothek The Deutsche Nationalbibliothek lists this publication in the Deutsche Nationalbibliografie; detailed bibliographic data are available in the Internet at http://dnb.d-nb.de.

Dissertation Technische Universität Darmstadt, 2009 D 17

1st Edition 2009 All rights reserved © Gabler | GWV Fachverlage GmbH, Wiesbaden 2009 Editorial Office: Claudia Jeske | Britta Göhrisch-Radmacher Gabler is part of the specialist publishing group Springer Science+Business Media. www.gabler.de No part of this publication may be reproduced, stored in a retrieval system or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the copyright holder. Registered and/or industrial names, trade names, trade descriptions etc. cited in this publication are part of the law for trade-mark protection and may not be used free in any form or by any means even if this is not specifically marked. Umschlaggestaltung: KünkelLopka Medienentwicklung, Heidelberg Printed on acid-free paper Printed in Germany ISBN 978-3-8349-2030-0

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Series Foreword Current developments like rapidly changing customers’ requirements, shortened product life cycles, increasing globalization, and demographic change associated with skilled worker and manager shortage present organizations with completely new challenges. The successful handling of these challenges requires the development of new business management concepts. These concepts should consider the following points: •

the increase of the companies’ market and innovation orientation (e.g., by the adaptation of the organizational structure respectively the promotion of the employees’ innovation and customer orientation),

•

the implementation of new working principles (e.g., customer-oriented and virtual global teams),

•

the long-range maintenance of managers’ and employees’ employability (e.g., by the setup and expansion of intercultural competences as well as targeted steps towards the promotion of the work-life balance), right up to

•

the preservation and expansion of human resources (e.g., by personal marketing activities such as targeted steps towards the advancement of elder and female employees as organizational potential).

The variety of possible starting points shows: a scientific consideration from the viewpoint of a single economic discipline meets these various challenges only to some extent. The series “Neue Perspektiven der marktorientierten Unternehmensführung” is dedicated to successful concepts of managing current and future developments in organizations’ practical experiences and presents an interdisciplinary perspective. This interdisciplinary approach is accounted for by a parallel illumination of different economic disciplines (i.e., marketing, innovation management, and human resource management). Additionally, the interface of different facets of business economics and psychology (i.e., work and organizational psychology) is of particular importance. The dissertations being published in the series “Neue Perspektiven der marktorientierten Unternehmensführung” orient themselves content wise and conceptually towards international

VI

Series Foreword



scientific standards. Starting from a stringent theoretical foundation the respective research topic is qualitatively and quantitatively investigated. The present titles deal with central questions in market-oriented business management. Thereby the single volumes provide scientists with new insights and suggestions for their research in that they approach the topics in different ways. For organizations’ practical experiences the different dissertations offer implications for dealing with current and future challenges of the market-oriented business management.

Darmstadt and Bochum, January 2009

Ruth-Stock Homburg and Jan Wieseke

VII



Foreword The importance of top executives for the success of their organizations is virtually undisputed for approximately three decades. For this reason, in the last years scientific papers in the area of management and market-oriented business management increasingly dealt with answering the question on what top executives’ success depends. Within the scope of market-oriented business management mainly underlying circumstances (e.g, intensity of competition and market dynamics) as well as executives’ demographic characteristics (e.g., age and tenure) were investigated. Thereby influencing variables on the level of attitudes and behaviors remained almost unregarded. Mrs. Eva-Maria Bauer closes this gap and pursues with her work the goal to provide a deeper understanding of top executives’ psychology in order to explain organizations’ success. In her work the author captures a rather broad management perspective. Although market-related magnitudes are considered in this work, it nevertheless is also relevant for research in the area of market-oriented business management. Together with psychological variables the author considers two phenomena which are deepened in her work: •

top executives’ relationship to their occupation in a specific organization (called top executives’ work relationship) as well as

•

the balance top executives perceive between their work and family life (called top executives’ work-family balance).

This work has as its goal to both theoretically and empirically investigate these two phenomena. Thus, it decisively contributes to the extension of the scientific state of knowledge in these areas. Former empirical works primarily carried out dependence analysis regarding top executives’ relevance for organizations’ success. In contrast, the author chooses a classification approach. For both investigated areas – top executives’ work relationship and top executives’ work-family balance – the author selects theoretically stringent and well-founded central variables in order to describe the respective phenomenon. The existent empirical literature multiplicatively proved differences between the occupations of diverse hierarchical levels. The present work explicitly highlights the differences within a population which is frequently implicitly categorized as relatively homogenous: the top executives in organizations. At the beginning of her work, the author develops a systematic procedure for the development of a theoretically-based taxonomy. By means of this approach, she extends previous taxo-

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Foreword



nomic research, which often starts with an empirical part without in advance specifying extensive theoretical bases. Additionally, the author recommends an explorative qualitative study prior to a quantitative empirical taxonomy development in order to better permeate little-known and equally complex phenomena. In my opinion, the process of taxonomy development elaborated in this work should be trend-setting for future works which underlie classifications. Corresponding to this process, the author initially conducts a qualitative study and interviews over 40 top executives about facets of their work relationship as well as characteristics of their work-family balance. The interviews are analyzed by means of a very sophisticated procedure of content analysis which is established in the leading international management research. In the second step, the author successfully surveys around 220 top executives regarding their work relationship and work-family balance. This relatively large sample is remarkable because top executives are an extremely difficultly accessible target group in the context of empirical studies. The author nevertheless manages to generate this sample by means of a very sophisticated procedure, in which she offers the top executives an individualized profound report of the results in respect to their personal work-life balance. Beyond that, in addition to the investigation of top executives, the self assessments of their life partners are also gathered. With her multi-methodological design as well as the dyadic quantitative study the author succeeds in generating a data basis, which to my knowledge, in this form, exists neither in national nor in international top management research. On the basis of a comprehensive data set, the author develops two taxonomies concerning top executives’ work relationship and work-family balance. Beyond that, she shows that top executives highly differ concerning their work relationship and their work-family balance. The results regarding the investigated variables related to these phenomena are interesting. On the basis of variance analysis the author shows that the top executives clearly differentiate in respect to their well-being and performance. Against the background of the frequently conducted debate on top executives’ relevance for the success of their organizations, the results of this work are not only novel but also highly relevant for the economic management research. The present work essentially extends the scientific state of knowledge involving two highly interesting phenomena – top executives’ work relationship and work-family balance. In addition, for organizations’ practical experiences interesting insights are generated. A broad diffusion in science and business practice is desirous for this thesis.

Darmstadt, July 2009

Ruth Stock-Homburg

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Acknowledgements First of all, I must thank Prof. Ruth Stock-Homburg, Ph.D., for her many ideas and enormous engagement in supervising me in my years as doctoral student, during which I have learned valuable skills for life. Additionally, I thank Prof. Ralph Bruder, Ph.D., who accepted the cocorrection of this thesis. I am very grateful to the Darmstadt Technical University for the scholarship, which enabled me to dedicate so much time to my research. Furthermore, I thank the German Research Foundation (DFG) for sponsoring this research project (grant number STO 477/9-1). Particular thanks go to the executives and their life partners, who participated in my study. With your openness and time you enabled the gathering of the data on which this thesis is based. Additionally, I am indebted to Tilo Guter, who transcribed the interviews and typed and re-typed the hundreds of pages that ultimately were distilled into this work. I would like to deeply thank my dear colleagues Gisela Bieling, Julia Pescher, and Nadine Ringwald. Without your willingness to help, suggestions, and support, this PhD thesis would not have been written. Furthermore, thanks a lot for the hours you spent copy reading and checking. Many thanks to Heather Lüft for proofreading my English! I cordially thank my brother for sharing his experience with me and for all the articles he has sent to me. Additionally, I sincerely thank our Dad for spending so much time in the last corrections of this thesis. Thanks a million to Grandma Waltraud and Grandma Barbara, who tenderly cared for Jakob, while I have spent hour after hour writing this thesis. Most of all I thank my family, Mathias and Jakob. For everything. I love you so much!

Ludwigsburg, August 2009

Eva-Maria Bauer

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Table of Contents 1

Introduction....................................................................................................................... 1 1.1 1.1.1

Managerial Relevance ..................................................................................................... 1

1.1.2

Scientific Relevance ........................................................................................................ 3

1.2

2

Major Goals and Structure of the Thesis................................................................................. 6

Conceptual Background................................................................................................... 9 2.1

Procedure of Taxonomy Development.................................................................................... 9

2.2

Literature Review .................................................................................................................. 12

2.2.1

Research on Top Executives ......................................................................................... 13

2.2.2

Research on Work Relationship .................................................................................... 23

2.2.3

Research on Work-Family Balance............................................................................... 32

2.2.4

Specification of Investigated Phenomena...................................................................... 46

2.3 2.3.1

Theoretical Background of Top Executives’ Work Relationship Taxonomy ....................... 50 The Job Demands-Resources Model ............................................................................. 50

2.3.2

Upper Echelons Theory................................................................................................. 55

2.3.3

Theoretical Conclusion for the Understanding of Top Executives’ Work Relationship59

2.4 2.4.1

3

Relevance of the Thesis........................................................................................................... 1

Theoretical Background of Top Executives’ Work-Family Balance Taxonomy.................. 61 Role Theory................................................................................................................... 61

2.4.2

Mechanisms of Work-Family Linkage.......................................................................... 65

2.4.3

Theoretical Conclusion for the Understanding of Top Executives’ Work-Family Balance........................................................................................................................ 67

Basics of the Empirical Studies...................................................................................... 71 3.1

Qualitative Study................................................................................................................... 71

3.1.1

Data Collection and Sample .......................................................................................... 71

3.1.2

Process of Qualitative Content Analysis ....................................................................... 73

3.2

Quantitative Study................................................................................................................. 74

3.2.1

Data Collection and Sample .......................................................................................... 74

3.2.2

Process of Scale Validation........................................................................................... 78

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Table of Contents



4

3.2.3

Process of Cluster Analysis ........................................................................................... 81

3.2.4

Process of Analysis of Variance.................................................................................... 84

Investigation of Top Executives’ Work Relationship .................................................. 87 4.1

Preliminary Conceptual Framework of Top Executives’ Work Relationship....................... 87

4.2

Qualitative Results Regarding Top Executives’ Work Relationship .................................... 89

4.3

Final Empirically Grounded Framework of Top Executives’ Work Relationship................ 97

4.3.1

Job-Related Demands.................................................................................................... 98

4.3.2

Job-Related Resources .................................................................................................. 98

4.3.3

Related Variables of Top Executives’ Work Relationship............................................ 99

4.3.3.1

Well-Being and Satisfaction.................................................................................. 99

4.3.3.2

Top Executive Performance ................................................................................ 100

4.3.3.3

Organizational Performance................................................................................ 100

4.4

Measurement of Top Executives’ Work Relationship ........................................................ 101

4.4.1

Measures of Active Cluster Variables Constituting Top Executives’ Work Relationship............................................................................................................... 102

4.4.1.1

Top Executives’ Job-Related Demands............................................................... 102

4.4.1.2 4.4.2

Top Executives’ Job-Related Resources ............................................................. 103 Measures of Related Variables of Top Executives’ Work Relationship ..................... 106

4.4.2.1 4.4.2.1.1

Well-Being and Satisfaction............................................................................. 106

4.4.2.1.2

Top Executive Performance ............................................................................. 108

4.4.2.2

5

Executive-Related Variables ............................................................................... 106

Organizational Performance................................................................................ 109

4.5

Interpretation of Cluster Solutions ...................................................................................... 112

4.6

Related Variables of Top Executives’ Work Relationship Types....................................... 119

Investigation of Top Executives’ Work-Family Balance........................................... 129 5.1

Preliminary Conceptual Framework of Top Executives’ Work-Family Balance ............... 129

5.2

Qualitative Results Regarding Top Executives’ Work-Family Balance ............................. 130

5.3

Final Empirically Grounded Framework of Top Executives’ Work-Family Balance ........ 136

5.3.1

Top Executives’ Satisfaction....................................................................................... 137

5.3.2

Top Executives’ Functioning ...................................................................................... 137

5.3.3

Top Executives’ Work-Family Conflict ...................................................................... 139

5.3.4

Related variables of Top Executives’ Work-Family Balance ..................................... 139

5.3.4.1

Individual Variables ............................................................................................ 139

Table of Contents

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 5.3.4.2

Work-Related Variables ...................................................................................... 140

5.3.4.3

Family-Related Variables.................................................................................... 140

5.4

Measurement of Top Executives’ Work-Family Balance ................................................... 140

5.4.1

Measures of Active Cluster Variables Constituting Top Executives’ Work-Family Balance...................................................................................................................... 140

5.4.1.1

Top Executives’ Satisfaction............................................................................... 141

5.4.1.2

Top Executives’ Functioning .............................................................................. 141

5.4.1.3 5.4.2

6

Top Executives’ Work-Family Conflict .............................................................. 142 Measures of Related Variables of Top Executives’ Work-Family Balance................ 143

5.4.2.1

Individual Variables ............................................................................................ 143

5.4.2.2

Work-Related Variables ...................................................................................... 144

5.4.2.3

Family-Related Variables.................................................................................... 145

5.5

Interpretation of Cluster Solution........................................................................................ 146

5.6

Related Variables of Top Executives’ Work-Family Balance Types.................................. 154

Discussion....................................................................................................................... 161 6.1

Contribution of the Thesis................................................................................................... 161

6.1.1

Content-Related Contribution ..................................................................................... 161

6.1.2

Conceptual Contribution ............................................................................................. 164

6.1.3

Methodological Contribution ...................................................................................... 166

6.1.4 6.2

Implications for Business Practice .............................................................................. 167 Limitations and Future Research......................................................................................... 169

References .............................................................................................................................. 173 Appendix ................................................................................................................................ 197

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List of Figures Figure 1-1: Course of the thesis ................................................................................................. 7 Figure 2-1: Procedure of taxonomy development (Stock-Homburg/Bauer 2009)................... 10 Figure 2-2: Focuses of top executive research ......................................................................... 14 Figure 2-3: Major areas of research on work relationship ....................................................... 24 Figure 2-4: Major areas of research on work-family issues..................................................... 34 Figure 2-5: Facets of top executives’ work relationship .......................................................... 59 Figure 3-1: Cluster methods used in this thesis........................................................................ 84 Figure 4-1: Preliminary conceptual framework of top executives’ work relationship ............ 88 Figure 4-2: Final empirically grounded framework of top executives’ work relationship ...... 97 Figure 4-3: Top executives’ work relationship types (expanded according to Bakker & Demerouti, 2007) ................................................................................................. 115 Figure 4-4: Plot of mean scores for underlying job-related demands and resources of the four clusters .......................................................................................................... 116 Figure 5-1: Preliminary conceptual framework of top executives’ work-family balance ..... 129 Figure 5-2: Final empirically grounded framework of top executives’ work-family balance137 Figure 5-3: Plot of mean scores for underlying variables of the five clusters ....................... 149

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List of Tables Table 2-1: Selected studies on top executives.......................................................................... 15 Table 2-2: Studies on job-related demands and resources ....................................................... 26 Table 2-3: Studies on work-family issues ................................................................................ 35 Table 2-4: Overview of the job demands-resources model by Demerouti et al. (2001) .......... 54 Table 2-5: Overview of upper echelons theory by Hambrick and Mason (1984).................... 58 Table 2-6: Overview of job-demands resources model and upper echelons theory ................ 60 Table 2-7: Overview of role theory by Katz and Kahn (1978) ................................................ 64 Table 2-8: Overview of mechanisms of work-family linkage among others by Near (1984) . 67 Table 2-9: Overview of role theory and mechanisms of work-family linkage ........................ 69 Table 3-1: Criteria of scale validation...................................................................................... 81 Table 4-1: Examples for top executives’ statements and corresponding field notes ............... 89 Table 4-2: Frequency of assigned codings............................................................................... 92 Table 4-3: Scale names, coefficient alpha, and composite reliability of active cluster variables ............................................................................................................... 105 Table 4-4: Descriptive statistics, and intercorrelations among active cluster variables......... 105 Table 4-5: Scale names, coefficient alpha, and composite reliability of related variables .... 110 Table 4-6: Descriptive statistics, and intercorrelations among related variables................... 111 Table 4-7: Results of testing between subjects effects of active cluster variables................. 113 Table 4-8: Statistical cluster description ................................................................................ 114 Table 4-9: Results of testing between subjects effects of related variables ........................... 121 Table 4-10: Related variables of cluster membership............................................................ 122 Table 5-1: Examples for top executives’ statements and corresponding field notes ............. 131 Table 5-2: Frequency of assigned codings............................................................................. 133 Table 5-3: Scale names, coefficient alpha, and composite reliability of active cluster variables ............................................................................................................... 142 Table 5-4: Descriptive statistics, and intercorrelations among active cluster variables......... 143 Table 5-5: Scale names, coefficient alpha, and composite reliability of related related variables ............................................................................................................... 146 Table 5-6: Descriptive statistics and intercorrelations among related variables.................... 146 Table 5-7: Results of testing between subjects effects of active cluster variables................. 147

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List of Tables

Table 5-8: Statistical cluster description ................................................................................ 148 Table 5-9: Results of testing between subjects effects of active cluster variables................. 155 Table 5-10: Related variables of cluster membership............................................................ 156 Table 6-1: Scales scored only by top executives (alphabetical order): Scale items with corresponding item-to-total correlations and factor loadings .............................. 197 Table 6-2: Scales scored only by life partners (alphabetical order): Scale items with corresponding item-to-total correlations and factor loadings .............................. 200 Table 6-3: Scales scored by top executives as well as life partners (alphabetical order): Scale items with corresponding item-to-total correlations and factor loadings ... 201

XIX

List of Abbreviations



Coefficient alpha

ANCOVA

Analysis of variance

ANOVA

Analysis of variance

AVE

Average variance extracted

CEO

Chief executive officer

CFO

Chief financial officer

CR

Composite reliability

df

Degrees of freedom

EBIT

Earnings before interest and taxes

Ed.

Editor

F

Test statistic of Duncan’s multiple-range test

ICC

Intraclass correlation coefficient

MANCOVA Multivariate analysis of covariance MANOVA

Multivariate analysis of variance

s. d.

Standard deviation

t

Test statistic of t-test

p

Significance level

r

Correlation coefficient

R2

Coefficient of determination

2

Test statistic of chi-square test

1



1 1.1

Introduction Relevance of the Thesis

1.1.1 Managerial Relevance Top executives today are confronted with extremely high demands at their workplace. Their major challenges are increasing competitive pressures in a globalized world and the downsizing and restructuring of organizations in order to better survive in the severely competitive market (e.g., Beynon et al. 2002; Uchitelle/Kleinfield 1996). In these turbulent environments which undergo rapid change, “speed, flexibility, rapid environmental adaptation, and high risk set the tone” (Delbecq/Friedlander 1995, p. 262). This “rapidly changing marketplace means intense pressures on managers to come up with new products, innovative services and novel marketing and financing schemes” (Lassiter 2004, p. 1). Additionally, due to technological progress, work is now very portable. This enables top executives to always answer emails or telephone calls and to accomplish the rest of what did not get done during office hours either in the evening or on weekends (Lassiter 2004). Accordingly, information overload and the pressure to always be available is the second most common source of managerial stress after time pressure (F.A.Z.-Institut 2009). Especially top executives suffer from the demands of modern communication (F.A.Z.-Institut 2009). As their extreme job involvement interferes with fulfilling both work and family roles (e.g., Batt/Valcour 2003; Olson/Manocchio 1991), this situation highly strains top executives’ family relationships (e.g., Shaffer/Harrison 1998). Furthermore, top executives “are often struggling with several complicated personal and organizational issues” at one time (Kets de Vries/Korotov 2007, p. 376). For example, “managing people is the most difficult administrative task and is an unending source of stress for executives” (Lassiter 2004, p. 1). These high challenges lead to an increased trend toward work intensification (e.g., Allan/O'Donnell/Peetz 1999), especially on the top executive level. Consequently, top executives have to invest an enormous amount of time and energy in the fulfillment of their jobs (e.g., Batt/Valcour 2003; Olson/Manocchio 1991). While some top executives are very adept in handling the pressures that leadership causes, others just can not manage them (Kets de Vries 1989). As a result of the high challenges they face and their extremely high job involvement, some top executives risk derailing soon after

2

Introduction



having reached the top (Kets de Vries 1989). Thus, they are afraid to fail and live in fear of being replaced at any moment (Kets de Vries 2006). In fact, companies are known to focus on firing underperforming CEOs (Lucier/Schuyt/Handa 2004). The CEOs’ uncertain job situation is aggravated by the tendency of such top executives to indulge “in conspicuously selfdestructive behavior, such as public affairs with numerous women”, substance abuse on the job or the inability to delegate (Kets de Vries 2006, p. 110). Such self-destructive behaviors are known to be negatively related to top executives’ performance (Kets de Vries 1989; Kets de Vries 1994). Another reaction of top executives to overwhelming demands is the engagement in irrational behavior (Hambrick/Finkelstein/Mooney 2005a; Kets de Vries 1994). In doing so, they rely “on preconceived fixed notions while ignoring or rejecting any contrary signs” (Finkelstein 2003, p. 153). An example of this irrational behavior is the adherence of Motorola to analogue phones in the 1990s while customers demanded and competitors supplied them with digital cell phones (Finkelstein 2003). The former Motorola CEO Gary Tooker states that “some of the leadership in the business at that time was focused too much on the short-term profits and they weren’t spending enough for the future” (Finkelstein 2003, p. 156). This irrational executive behavior is often accompanied by “hundreds of millions or billions in losses” for the companies these top executives are leading (Finkelstein 2003, p. 153). Besides this threat to companies’ success, many top executives themselves suffer severely from their demanding work life and react to it with feelings of stress and exhaustion. Ten percent of German managers always feel stressed, and 26 percent of them often feel stressed (F.A.Z.-Institut 2009). On the top executive level stress is even more wide-spread. For example, over 98 percent of health care CEOs feel stressed (Ganster 2005). Overall, one out of three employed persons in Germany suffer from exhaustion and burnout (F.A.Z.-Institut 2009). As a result, in the last year German companies were affected by the absenteeism of 40,000 professionals who were on sick leave on nearly ten million days because of burnout symptoms (F.A.Z.-Institut 2009). This burnout-related sickness increased about 17 percent in the last five years (Techniker Krankenkasse 2009). Especially highly stressed top executives are vulnerable to the development of severe health problems and burnout (Lassiter 2004). “Burnout occurs when managers are deluged with sets of competing demands. Not only is work intense, but there are also demands to participate in family life, keep up with friends, and complete normal chores of everyday living. […] They feel overwhelmed and retreat” (Lassiter 2004, p. 1). This withdrawal is often accompanied by a decline in performance. Accordingly, 69 percent of health care CEOs report that their work-related stress negatively affects their productivity (Ganster 2005). Some top executives can not cope with their enormous work-related challenges and the result of their excessive demands is fatal (Kets de Vries 1999). For example, Adolf Merckle, owner

Relevance of the Thesis

3



of several global companies like Ratiopharm and HeidelbergCement, committed suicide at the beginning of this year (Kaiser/Tuma 2009). He apparently could no longer bear the enormous challenges and awkward situation of his business empire, which began to totter in the financial crisis. These high work-related pressures are aggravated by the fact that the top executive’s position is often accompanied by social isolation and a loss of emotional support (Kets de Vries 1992). This “kind of isolation seems all too common among people who head organizations” (Kets de Vries 1989; Kets de Vries 1994). As a result of the important position of top executives in their organizations, a decline in their performance or their sudden absence is especially harmful to the success of their organizations (e.g., Finkelstein/Hambrick 1996; Hambrick 1989; Hambrick/Mason 1984). As a result from numerous research studies provide considerable evidence that top executives affect organizational performance (e.g., Carpenter/Fredrickson 2001; Finkelstein/Hambrick 1996; Henderson/Miller/Hambrick 2006). For example, decisions of top executives (e.g., Amason 1996; Boeker 1997; Flood et al. 2000) and top executives’ leadership behavior (e.g., Smith/Carson/Alexander 1984) are proven to have an important impact on organizational outcomes. In a recent article, Hambrick (2007, p. 334) states: “If we want to understand why organizations do the things they do, or why they perform the way they do, we must consider the biases and dispositions of their most powerful actors – their top executives”. To better support top executives and enhance their performance, companies should know more about their top executives. For example, it is of high interest to know what enables some top executives to successfully cope with stress at work and at home and to avoid burnout (Delbecq/Friedlander 1995). Overall, the factors that are positively or negatively related to top executives’ performance are of high interest in this context. At the moment, much is known about employees and the development of their different performance levels (e.g., Chen/Francesco 2003; De Ruyter/Wetzels/Feinberg 2001; Griffin/Welsh/Moorhead 1981; Orpen 1979; Salanova/Agut/Peiró 2005; Wright/Bonett 1997). On the top executive level, it is also well known that different performance levels exist (e.g., Allgood/Farrell 2003; Bushman/Indejejikian/Smith 1996). But so far, less is known about the work-related, home-related and personal factors that are positively or negatively related to top executives’ performance. Accordingly, to our knowledge, different top executives’ work relationship and work-family balance types and their performance implications have not yet been identified. 1.1.2 Scientific Relevance In the last two decades, top executives have received a great deal of attention in management literature (e.g., Finkelstein 1992; Finkelstein/Hambrick 1990; Finkelstein/Hambrick 1996; Flood et al. 2000; Hambrick/Finkelstein/Mooney 2005a, 2005b). But despite the high relevance of top executives’ work relationship and work-family balance for them and their companies, these phenomena have been largely neglected in existent research. We define top

4

Introduction



executives as the most influential persons at the apex of the organization (e.g., Flood/MacCurtain/West 2001; Mintzberg 1979). They “set the organization’s strategy: what markets to enter, with whom to merge, how much to invest, what technology to employ” (Osterman 2009, p. 6). In this role, they carry high responsibility for the fate of their organizations by generating information and announcing decisions (Schein 1994). Thereby, one of their major responsibilities “is to help their firms contend with the contingencies emanating from their organizations’ task environments” (Bigley/Wiersema 2002, p. 722). Top executives are more likely than subordinate employees to be “motivated by the intrinsic satisfaction their work provides, rather than by extrinsic rewards” (Westphal 1999, p. 20). This may be due to motivating characteristics of their job like high job autonomy, task variety, and decision latitude (Karasek 1979). In contrast to a top executive, “an employee is one who a person has the right to direct and control in the performance of some compensated duties” (Dau-Schmidt/Ray 2004, p. 117). Work may bring about intrinsic rewards also for employees (Deci/Ryan 1985), but in the first place it provides extrinsic rewards (Locke/Latham 1990). While differences between top executives and subordinate employees regarding their work relationship and their work-family balance are undoubted (e.g., Hambrick/Finkelstein/Mooney 2005a; Knudsen/Ducharme/Roman 2009), research regarding differences among top executives is scarce (Hambrick/Finkelstein/Mooney 2005a). Consequently, we know for example “that executive personalities and experiences can affect organizational outcomes (Bantel/Jackson 1989; Miller/Droge 1986), but we have no insights about how the degree of challenge a given executive experiences in his or her job will affect task conduct, strategic actions, or performance” (Hambrick/Finkelstein/Mooney 2005a, p. 472). But this knowledge about differences among top executives can be of high relevance for supporting the individual top executive in the amelioration of his or her work relationship and work-family balance. Thus, top executive-specific empirical findings in the areas of work relationship and workfamily balance are very limited (Knudsen/Ducharme/Roman 2009). But distinct attention to these phenomena at the top executive level is warranted because top executive work is qualitatively different from work at other organizational levels (Hambrick/Finkelstein/ Mooney 2005a). This difference does not mean that existing literature on these phenomena is irrelevant. Nevertheless, that literature is incomplete or strained when applied to the top executive level. The first phenomenon considered in this work, a top executive’s work relationship, is defined as “an executive’s capability to use his or her job-related resources to handle job-related demands” (Stock-Homburg/Bauer 2009, p. 2). The second phenomenon of interest is top executives’ work-family balance and is defined as a top executive’s “satisfaction and good functioning at work and at home, with a minimum of role conflict” (Clark 2000, p. 751).

Relevance of the Thesis

5



Thus, the phenomenon work-family balance reflects a top executive’s orientation toward his or her participation in work and family roles (Marks/MacDermid 1996). To our knowledge, the phenomena of work relationship and work-family balance have not been investigated in their entirety with all facets. On the contrary, the treatment of work relationship and work-family balance in the empirical literature has been highly fragmented (see section 2.2). This fragmented empirical evidence is unsatisfactory since a top executive’s work relationship and work-family balance represent both multifaceted, highly complex phenomena. The investigation of such complex phenomena through holistic patterns of multiple variables rather than isolated variables and their bivariate relations seems to be promising in a field, where the conceptual knowledge is still at an early stage (e.g., Ketchen et al. 1997; Meyer/Tsui/Hinings 1993). In order to capture this complexity, an approach is needed which describes typical forms of top executives’ work relationship and work-family balance. A suitable approach is seen in the taxonomy approach, as taxonomies help bring order to the complex set of interrelated phenomena (e.g., Hambrick/Mason 1984; McKelvey 1975). Thus, this thesis uses empirically-based taxonomies to analyze top executives’ work relationship and work-family balance. Specifically, clustering algorithms are used to identify natural clusters in the data (Miller 1996). Most existing taxonomies have been criticized for being disconnected from theory. Specifically, they are often based on an arbitrary and narrow selection of variables, and generally lack theoretical significance (e.g., Miller 1996). To address these problems, we strongly connect our configurational approach to theory. This is advisable as “chances of deriving types that inform conceptual debate will be enhanced if configurationists are guided by promising theoretical paradigms” (Miller 1996, p. 508). In doing so, we conceptually derive the variables on which our taxonomies are based. We then empirically verify the selected variables with the help of rich qualitative data as recommended in the literature (e.g., Miller 1996). This process helps us to identify clusters which suggest distinct, i.e., cluster-specific theoretical and practical implications. Thus, the investigation of different configurations of top executives’ work relationship and work-family balance is highly relevant to enlarge the scientific knowledge of these so far neglected phenomena.

6

Introduction



1.2

Major Goals and Structure of the Thesis

The preceding section showed the high relevance of a theory-based and extensive investigation of top executives’ work relationship and work-family balance as well as related variables. Accordingly, the present work pursues three central goals (see Figure 1-1 for an overview): 1. Development of a theory-based taxonomy on top executives’ work relationship: To our knowledge, different patterns of top executives’ work relationship have received no attention in existent research. Thus, the first goal of this thesis is to develop a theorybased taxonomy on top executives’ work relationship. Thereby, cluster analysis searches for an adequate partition of objects or individuals that can establish homogeneity within groups and heterogeneity between groups (e.g., Forgy 1965; MacQueen 1967). Like outlined before, we connect the development of our taxonomy on top executives’ work relationship to theory. Specifically, we draw upon upper echelons theory (e.g., Hambrick 2007; Hambrick/Finkelstein/Mooney 2005a, 2005b; Hambrick/Mason 1984) and the job demands-resources model (e.g., Bakker/Demerouti 2007; Demerouti et al. 2001; Xanthopoulou et al. 2007b) to conceptualize top executives’ work relationship. 2. Development of a theory-based taxonomy on top executives’ work-family balance: As top executives’ work-family balance has not been investigated by existent research in its entirety including all relevant facets, the second goal of this thesis is to develop a taxonomy on top executives’ work-family balance using cluster analysis techniques. The taxonomy of top executives’ work-family balance is also based on theory. Specifically, we draw on role theory (e.g., Katz/Kahn 1978) and mechanisms of workfamily linkage (e.g., Lambert 1990; Staines 1980; Zedeck 1992) to conceptualize top executives’ work-family balance. 3. Investigation of related variables: Specific attention to the investigation of top executives’ work relationship and work-family balance is warranted because any positive or negative effect of these phenomena could have far-reaching implications for organizations’ vitality and performance (e.g., Finkelstein/Hambrick 1996; Hambrick 1989; Hambrick/Mason 1984). Thus, the investigation of related variables of the phenomena work relationship and work-family balance, such as top executives’ well-being and performance is also of special importance. Therefore, besides categorizing top executives regarding their work relationship and work-family balance, the third goal of this thesis is the investigation of variables that are related to their work relationship and work-family balance. Specifically, we focus on psychological (i.e., well-being and satisfaction) as well as individual and organizational performance outcomes of top executives’ work relationship and work-family balance.

Major Goals and Structure of the Thesis

7

 Figure 1-1: Course of the thesis

Course of the thesis

Major goals

Appraisal of the relevance of the phenomena under study

Description of taxonomy development based on cluster analysis techniques Description of investigation of related variables

Discussion of the contributions and limitations of the thesis

Goal 2: Development of a theory-based taxonomy on top executives’ work-family balance

Implementation of basics of empirical inquiry: Data collection, sample, and analysis techniques

Chapter 1: Introduction

Goal 1: Development of a theory-based taxonomy on top executives’ work relationship

Embedding of the phenomena in existent research and theoretical foundation of the taxonomies

Chapter

Goal 3: Investigation of related variables

Chapter 2: Conceptual background

Chapter 3: Basics of empirical studies

Chapter 4: Investigation of executives’ work relationship

Chapter 5: Investigation of executives’ work-family balance

Chapter 6: Discussion

Besides the three major goals of this thesis, two further characteristics deserve specific attention. First, there is a need for extensive studies to understand top executives’ approaches in handling their work and family life. Against this background, this thesis will be based on a combination of qualitative and quantitative empirical techniques. Specifically, we use a qualitative study drawing on data from 42 top executives. The key contribution of this qualitative research is to confirm and to enrich the theoretically derived categories of top executives’ work relationship and work-family balance. In a second step, we survey a sample of more than 200 top executives and their life partners. This sample delivers quantitative data that serve as the basis for developing our taxonomies. Prior literature indicates the value of such multimethod approaches (e.g., Jick 1979; Ruderman et al. 2002; Scandura/Williams 2000). Second, the quantitative data will not be restricted to top executives’ self assessments. Rather, we use self-reports from top executives as well as assessments from their life partners. This additional perspective is considered as highly important because top executives are known to underestimate their job-related demands (Hambrick/Finkelstein/Mooney 2005b) and tend to deny negative outcomes of stress and overwork (Kofodimos 1990). This thesis is structured within six chapters as follows. This introductory chapter outlines the managerial and scientific relevance of the phenomena under study (see section 1.1).

8

Introduction



Furthermore, the major goals and the structure of this thesis are presented (see section 1.2 and Figure 1-1 for an overview). Subsequently, in chapter 2 the conceptual background of this thesis is presented. At the beginning of the chapter, the procedure of taxonomy development that served as a guideline for the development of the two taxonomies is presented (see section 2.1). Next, the two investigated phenomena, i.e., top executives’ work relationship and top executives’ workfamily balance, are embedded in existent research (see section 2.2). Afterwards, the theoretical background of the taxonomies is outlined. In section 2.3, the job demandsresources model and upper echelons theory are presented as core concepts of the development of the top executives’ work relationship taxonomy. In section 2.4, role theory and mechanisms of work-family linkage are introduced, which serve as theoretical background for the development of the top executives’ work-family balance taxonomy. In chapter 3, the basics of the empirical studies are presented. In section 3.1, the qualitative study with its data collection process and sample, as well as the process of qualitative content analysis are outlined. Section 3.2 depicts the process of scale validation, the data collection process and sample, as well as the process of cluster analysis and analysis of variance used in the quantitative study. This chapter contains all basic information on the empirical studies which are fundamental to the development of both, top executives’ work relationship and work-family balance taxonomies, and serves as starting point for the following two contentspecific chapters. The following two chapters are both structured alike, chapter 4 containing the investigation of top executives’ work relationship and chapter 5 containing the investigation of top executives’ work-family balance. Chapter 4 and 5 both outline the following six sections: First, the preliminary conceptual framework of the phenomenon under consideration is presented (see section 4.1 and 5.1 respectively). Second, the qualitative results of the empirical verification are outlined (see section 4.2 and 5.2 respectively). Third, the final empirically grounded framework is introduced (see section 4.3 and 5.3 respectively). Fourth, the measurements of the different facets of top executives’ work relationship (see section 4.4) and work-family balance (see section 5.4) are outlined. Fifth, the resulting cluster solutions are interpreted (see section 4.5 and 5.5 respectively). Finally, the investigation of related variables of the two phenomena is described (see section 4.6 and 5.6 respectively). The final chapter contains the summarizing discussion of the contributions and limitations of this thesis. Section 6.1 outlines the content-related, conceptual, and methodological contributions of this thesis as well as its implications for business practice. Section 6.2 completes the thesis with the discussion of the limitations of this thesis and ideas for future research.

9



2 2.1

Conceptual Background Procedure of Taxonomy Development

The development of top executives’ work relationship and work-family balance types in this thesis follows suggestions on taxonomy building in the existent literature (e.g., Bunn 1993; Marks/Mathieu/Zaccaro 2001). A taxonomy is an empirically, that is numerically and quantitatively derived scheme that categorizes phenomena into mutually exclusive and exhaustive types. This categorization is based on a set of unique and differentiated attributes (i.e., the active cluster variables) and the application of cluster analysis methods (e.g., Cannon/Perreault 1999; Doty/Glick 1994; Hambrick/Mason 1984; Meyer/Tsui/Hinings 1993; Miller 1996). In contrast, a typology is a conceptually derived scheme. It may serve well for descriptive purposes but has limited explanatory or predictive power. Typologies identify multiple ideal types, each of which represents a unique combination of attributes that are believed to determine the relevant outcomes (e.g., Doty/Glick 1994; Hambrick/Mason 1984; Meyer/Tsui/Hinings 1993; Miller 1996). As we have chosen an empirical approach, we develop taxonomies of top executives’ work relationship and work-family balance. At the same time, we conceptually derive the facets and constructs that serve as input for the taxonomy development. The procedure for developing our theoretically based taxonomies consists of a conceptual part (adapted from Marks/Mathieu/Zaccaro 2001) and an empirical part (adapted from Bunn 1993). The procedure is composed of nine sequential steps (see Figure 2-1) and will be outlined in the following. The purpose of the conceptual part is the theoretical foundation of the taxonomy and the identification and selection of appropriate input variables for the development of the taxonomy. The conceptual part of our taxonomy development procedure consists of the steps one to three and step five of the taxonomy development procedure.

10

Conceptual Background

 Figure 2-1: Procedure of taxonomy development (Stock-Homburg/Bauer 2009) I. Conceptual Part

II. Empirical Part

Step 1: Review of extant literature

Step 2: Specification of investigated phenomenon

Step 3: Theory-based identification of major facets and constructs

Step 4: Qualitative empirical verification and enrichment of theoretically selected constructs

Step 5: Definition of core constructs Step 6: Quantitative measurement and empirical validation of core constructs

Step 7: Taxonomy development based on cluster analysis techniques

Step 8: Interpretation of cluster solution

Step 9: Investigation of related variables

In the first step, the existent literature concerning the investigated phenomenon and closely related taxonomies are reviewed. Learning effects from existing conceptualizations and taxonomies as well as areas to differentiate the own taxonomy from existent research are identified. The second step focuses on the specification of the investigated phenomenon. Here, an overall label for the investigated phenomenon is found, and the most important terms are defined. The theory-based identification of major facets is the focus of the third step. First, a suitable theoretical approach in order to more deeply understand the investigated phenomenon has to be selected. Second, relevant major facets and related constructs in order to describe the investigated phenomenon are identified. Thereby, a facet summarizes connected aspects concerning one content, e.g., top executives’ work-related skills. Thus, several associated constructs are allocated to each facet of the phenomenon. For example, the constructs self-management and ability to delegate are part of the facet work-related skills. The last step within the conceptual part is the definition of all constructs that is all variables constituting the taxonomy and all related variables. This is an important step because a precise definition is a prerequisite for an unambiguous operationalization of the variables. The major goal of the empirical part is to reduce the complexity of the investigated phenomenon by identifying different types, based on qualitative and quantitative empirical

Procedure of Taxonomy Development

11



data. The methodological part consists of step four and the steps six to nine of the taxonomy development procedure. The first step of the empirical part is situated between the last two steps of the conceptual part and consists of the qualitative empirical verification and enrichment of the theoretically identified facets and constructs. In this step, the relevance of the theoretically derived facets and constructs for the investigated phenomenon is empirically checked based on semi-structured interviews with suitable informants. Furthermore, the interviews are used to verify the related variables, which are supposed to be associated with the investigated phenomenon. If necessary, the theoretically identified facets and constructs are enriched according to the results of the qualitative interviews. In the sixth step of the taxonomy development procedure, all constructs are quantitatively measured with the help of a questionnaire. Then the measurement properties of the used scales have to be checked. Besides psychometric properties (i.e., coefficient alpha, composite reliability) the dimension-structure of constructs is identified based on factor analyses. It has to be decided whether to choose the whole construct or to separate dimensions of the construct as active cluster variables. Then, the discriminance between the different active cluster variables has to be checked. Discriminant validity provides evidence of construct validity by ensuring that measures of unrelated hypothetical constructs are not correlated highly with one another and thus discriminate between dissimilar constructs (Campbell/Fiske 1959). Accordingly, a construct should be eliminated from the set of active cluster variables when the average variance extracted of the construct is smaller than the shared variance of this construct with any other latent variable (Fornell/Larcker 1981). Additionally, multi-rater measures are checked for interrater reliability (with ICC: intraclass correlation coefficient, Shrout/Fleiss 1979). Then, constructs with high intercorrelations (Campbell/Fiske 1959) or weak ICC (55) top executives. Thus, these top executives are more likely than top executives in the other clusters to be in an earlier stage of their career, where they have to maintain their ground more intensively than older and already better settled top executives. As their struggle for achievement costs much of their energy but nevertheless often seems to be in vain, they are likely to get dissatisfied and frustrated. Furthermore, this cluster contains the largest proportion of fulltime working partners, who thus cannot invest much time themselves in the management of family life. But obviously, these partners attribute to the top executives a low functioning at home and thereby contribute to the conflict-laden situation of the frustrated strugglers.

154

Investigation of Top Executives’ Work-Family Balance



In summary, we find support for our prediction that top executives handle and experience their multiple life roles differently. This finding is consistent with the predictions of role theory and mechanisms of work-family linkage. Thus, our results partially confirm the theoretically predicted top executives’ work-family balance types. We find clear support for the role scarcity perspective (Goode 1960), predicting that the involvement in multiple life roles is associated with interrole conflict. The torn integrator, who conceives multiple life roles as conflicting, is prototypical for this perspective. In contrast, the enhancement perspective (Marks 1977; Sieber 1974), predicting that engagement in multiple roles can be beneficial for individuals, is not clearly represented in our top executive sample. No top executives’ work-family balance type highly engages in both roles and in doing so, experiences his workfamily situation as satisfying, shows a good functioning in both domains and little conflict between the life domains. The highest satisfaction and the least conflict are experienced by the happy performer. But contrary to the predictions of the enhancement perspective, the happy performer unilaterally engages in the work role, thereby neglecting his family role. This finding is in line with the one of Delbecq and Friedlander (1995), who found that successful top executives’ spouses always played the predominant role in managing family affairs. Apparently, like demonstrated by the torn integrator and the family-focuser, for a top executive, faced with an extremely demanding work role, a parallel engagement in another role is accompanied by role conflicts (e.g., Drew/Murtagh 2005). Furthermore, we find support for three mechanisms of work-family linkage: With the help of segmentation, the indifferent segmentor tries to keep work issues out of home life. Accommodation is used by the happy performer to concentrate on the work role as well as by the family-focuser, to dedicate more engagement to the family domain. Finally, the frustrated struggler decreases family involvement and (inefficiently) seeks for satisfaction in the work domain, which represents the mechanism of compensation. In our top executive sample, we could not find high similarities between the two domains as evidence for spillover effects between work and family life.

5.6

Related Variables of Top Executives’ Work-Family Balance Types

As a last step, we investigate the extent to which these configurations differ in terms of several related variables. Thus, we compare top executives’ work-family balance types on related variables using Duncan’s multiple-range test. We find significant differences between the cluster means for all related variables (Table 5-9). In Table 5-10, we provide the related variables associated with the five clusters. Means with the same superscript do not differ at a 5 percent significance level.

Related Variables of Top Executives’ Work-Family Balance Types

155

 Table 5-9: Results of testing between subjects effects of active cluster variables Related variables Dependent variable

Core self evaluation

Exhaustion

Health Organizational commitment

Effectiveness

Type III sum of squares

Degrees of freedom

Mean of squares

Model 21.814 Error 80.393

4 208

Model 47.678 Error 162.261

F

Significance

5.453 0.387

14.110***

.000

4 208

11.919 0.780

15.279***

.000

Model 12.804 Error 122.780

4 208

3.201 0.590

5.423***

.000

Model 40.172 Error 275.451

4 208

10.043 1.324

7.584***

.000

Model 6.888 Error 94.940

4 208

1.722 0.456

3.773***

.000

27.833 153.384

4 208

6.958 0.737

9.436***

.000

27.477 210.371

4 208

6.869 1.011

6.792***

.000

Partners’ life satisfaction Model Error Partners’ work-family balance satisfaction Model Error * p