MASTER THESIS

The Change Process of Organizational Culture:

Validation of a Measurement Tool -

The High-Performance Organization-Analyzer

Prof. Dr. Martin Hoegl

Part-time MBA Class of 2013

Damian Beldycki

Helmholtzstr. 12

40215 Duesseldorf

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ABSTRACT

This master thesis makes a contribution to the validation and as the case may be to the improvement of

an instrument for measuring organizational culture called the High-Performance Organization-

Analyzer (HPO) (Heidbrink & Jenewein, 2011). The HPO is based on theoretical foundation of

transactional and transformational leadership (B. M. Bass, 1985), initially measured by Organizational

Description Questionnaire ODQ (B. M. Bass & Avolio, 1993). In order to have a secured tool to

measure organizational culture reliability as well as validity has to be fulfilled. This master thesis

intends to cover the part of validity; more precisely construct validity, while the reliability part was

substantiated in detail (Brenner, 2012).

In a field study datasets of different companies in Germany and Russia were collected. This data

contains the filled ODQ and HPO-Analyzer as well as expert opinions.

Three different methods based on that data are used to quantify the validity of the current used

questionnaire and mixing console. Firstly, the evaluation of convergent validity of the HPO-Analyzer

towards the ODQ is analyzed. Secondly, the evaluation of discriminant validity of the HPO-Analyzer

towards a null model is measured. Lastly, the evaluation of accordance of the HPO-Analyzer towards

expert opinions is assessed.

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I Contents

1 INTRODUCTION ....................................................................................................................... - 6 -

1.1 Organizational Culture as Leverage of Performance ....................................................... - 6 -

1.2 Organizational Culture as a Broad Concept ..................................................................... - 7 -

1.3 Validity of HPO Design ........................................................................................................ - 8 -

2 THEORETICAL BACKGROUND AND RESEARCH MODEL ........................................ - 10 -

2.1 Dimensions and Definition of Organizational Culture ................................................... - 10 -

2.2 Transformational and Transactional Organizational Leadership and Culture .......... - 12 -

2.3 Measurement of Organizational Leadership and Culture ............................................. - 15 -

2.4 Organizational Description Questionnaire (ODQ) ......................................................... - 17 -

2.5 The High-Performance Organization-Analyzer (HPO) ................................................. - 19 -

3 METHODS ................................................................................................................................. - 25 -

3.1 Respondents ........................................................................................................................ - 25 -

3.2 Measures.............................................................................................................................. - 27 -

4 RESULTS ................................................................................................................................... - 31 -

4.1 Descriptive and Explorative Statistics .............................................................................. - 31 -

4.2 Inferential Statistics ........................................................................................................... - 35 -

4.3 Qualitative Comparison ..................................................................................................... - 38 -

5 DISCUSSION AND FUTURE RESEARCH DIRECTIONS ................................................ - 41 -

5.1 Summary, Implications and Recommendations .............................................................. - 41 -

5.2 Limitations .......................................................................................................................... - 43 -

5.3 Final Note ............................................................................................................................ - 45 -

6 APPENDIX ................................................................................................................................. - 47 -

7 REFERENCES .......................................................................................................................... - 69 -

8 DECLARATION OF AUTHORSHIP ..................................................................................... - 72 -

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II Table of Figures

Figure 1: The three levels of culture................................................................................................ - 11 -

Figure 2: The four Is of transformational leadership. ................................................................... - 13 -

Figure 3: The full range of leadership. ............................................................................................ - 16 -

Figure 4: Classification of the organizational culture by ODQ. ................................................... - 18 -

Figure 5: The ten levers of HPO. ..................................................................................................... - 19 -

Figure 6: Classification of the organizational culture by HPO. ................................................... - 23 -

Figure 7: Scatter plot of transformed ODQ and HPO overall scores. ......................................... - 35 -

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III Table of Tables

Table 1: Descriptive statistics for HPO levers. ............................................................................... - 32 -

Table 2: Descriptive statistics for the ODQ dimensions. ............................................................... - 32 -

Table 3: Factor Analysis results for HPO scale transformation. ................................................. - 33 -

Table 4: Comparison of HPO and ODQ transformed overall scores. ......................................... - 34 -

Table 5: Comparison of experts’ HPO and ODQ transformed overall scores. ........................... - 34 -

Table 6: Spearman's Rank Correlation Coefficient for overall score.......................................... - 36 -

Table 7: Spearman's Rank Correlation Coefficient for all levers. ............................................... - 36 -

Table 8: Comparison of HPO data with a null model. .................................................................. - 37 -

Table 9: P-Values of Wilcoxon-Signed-Rank-Test for all levers. ................................................. - 37 -

Table 10: Test statistics of equivalence test for overall score. ...................................................... - 38 -

Table 11: Test statistics of unpaired equivalence test for all levers. ............................................ - 38 -

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1 INTRODUCTION

First of all I aim to introduce the potency of organizational culture and the various ways how it

influences the effectiveness and efficiency of companies. I will demonstrate why it really matters to

deal with organizational culture. To utilize culture in a beneficial modality we must in the first instance

measure and quantify it, quite in the sense of the famous management guru Peter Drucker “what gets

measured gets managed”. Thus, I will touch some pitfalls regarding the culture measurement based on

its complexity. Due to these challenges I will motivate the demand for a new measurement tool.

1.1 Organizational Culture as Leverage of Performance

Every business organization will evolve its own organizational culture regardless whether we like it or

not. The key question top management needs to answer is: “Does this culture help its organization to

fulfill the intended goals?” (Heidbrink & Jenewein, 2011: 5)

The latest Gallup study for the year 2011 (Nink, 2012) based on the Gallup Engagement Index Q12®

, a

measurement for commitment to the current workplace, revealed that, low employee motivation results

in high sick day and labor turnover rates, a lack of innovations and a low readiness for recommendation

of the current employer. In Germany alone “the economic costs due to internal termination amount to a

total of 122.3 to 124.0 billion euros annually” (Nink, 2012: 11). Organizational culture is too critical

due to its power to set priorities and coordination function for employees to leave it to chance

(Chatman & Cha, 2003). As organizational culture strongly influences commitment and involvement of

personnel (Denison & Mishra, 1995; Kotter & Heskett, 1992) it is a potent instrument to increase the

emotional engagement. Firms should use culture to boost the employees’ satisfaction and, accordingly,

to anticipate the noted downsides.

Otherwise, a lot of best practice case studies, like Southwest Airlines, Toyota or the SAS Institute, were

analyzed to investigate how to achieve extraordinary performance with the help of strong

organizational culture, and are still taught in executive education, e.g. the corresponding EMBA

program of WHU- Otto Beisheim University. Those and other examples show impressively how

culture is able to motivate workers to go the extra mile (Jenewein & Heidbrink, 2008).

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Additionally, individual leadership possesses a strong correlation with corporate culture (B. M. Bass &

Avolio, 1993). Although there is not sufficient empirical evidence, whether culture influences

leadership or the other way around (Parry & Proctor-Thomson, 2001), there is at least a common sense

that probably both mutually interfere (Schein, 2009). Consequently, it is crucial for leaders to be aware

of the prevailing culture to execute their leadership approach. Only acting in alignment with the culture

will provide an effective impact, e.g. it will not work out to empower subordinates in highly

hierarchical, former Soviet companies by transferring the full reasonability for their projects

(McCarthy, Puffer, May, Ledgerwood, & Steward, 2008).

Moreover, organizational culture is directly linked to the desired corporate strategy, modes of operating

and influences not only the behavior of individuals but also ultimately of the whole institute (Schein,

2009). Hence, one of the success factors for strategy implementation is alignment of the organizational

culture to the prepared vision (Pietersen, 2010). For instance the business model of the Service-Profit

Chain rests upon the link of culture and strategy (Heskett, Jones, Loveman, Sasser, & Schlesinger,

2008). Ultimately, understanding of the existing culture is a pre-requisite for any aspiring change (B.

M. Bass & Avolio, 1993; Schein, 1990).

In sum, organizational performance indisputably influences the bottom-line on a significant level via

different levers. Accessorily, culture forms a competitive advantage, which could sustain, because

culture is very hard to copy by other companies (Sackmann, 2006).

1.2 Organizational Culture as a Broad Concept

The recording of organizational culture as an end in itself is not worthwhile (Heidbrink & Jenewein,

2011). Organizational culture is such broad and complex concept where we can get lost easily, without

concentrating on the management implications (Schein, 2009). Therefore, it seems meaningful to

evaluate the culture with the purpose to identify the gaps between prevailing and desirable culture in

alignment to the overall strategy (Heidbrink & Jenewein, 2011). Yet, “one cannot really build, evolve,

or change culture without getting into the messy details of particular cultures” (Schein, 2009: x).

Consequently, it is important for culture measurement tools to quantify culture precisely, valid and

reliable in order to deduct tailor-made recommendations for the top management (Wunderer, 2006).

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Another danger while dealing with culture is to oversimplify it (Schein, 2009). For this reason culture

measures have to cover both the visible and invisible part of culture as holistic as possible (Parry &

Proctor-Thomson, 2001). The High-Performance Organization-Analyzer (HPO) I discuss in this work

describes an alternative to the well-known and spread Organizational Description Questionnaire (ODQ)

(B. M. Bass & Avolio, 1993). In this vein it enables companies to evaluate the complexity of culture in-

depth in ten different dimensions and in that way offers a necessary integral approach.

Lastly, there is no superior culture existing, which could be adapted by any organization. The welcome

culture needs to be adaptive (Kotter & Heskett, 1992) and depends among other characteristics on the

development stage of organizations (B. M. Bass & Avolio, 1993), regional and national aspects (Alon

& Higgins, 2005) and founders values (Chatman & Cha, 2003). Again we need an accurate

measurement capable to determine an overall organizational culture as well as to illuminate most of its

facets.

In a nutshell, organizational culture adheres multitudinous, various layers and we must precisely

examine as much as possible of those to be able to work out cultural changes.

1.3 Validity of HPO Design

The main goal of this master thesis is to ensure that the HPO indeed measures what it supposes to

measure namely organizational culture. The convergent validity part of this validation of the HPO will

be assessed towards the ODQ, a multiple times tested tool for validity and reliability (B. M. Bass &

Avolio, 1993; Parry & Proctor-Thomson, 2001). To eliminate contingency I will test the HPO

outcomes against a random designed null model. In a third step for inspection of construct validity I

will compare the HPO results with insider expert opinions, the most valid way to assess culture for

accordance (Schein, 2009). With this work the existing gap for inevitable HPO validity will be closed

and combined with the reliability study (Brenner, 2012) we will create a secured tool to conduct

profound measurement.

Furthermore, all degrees of freedom for designing of the HPO, for instance choice of the right scale or

the selection of appropriate weights to accumulate an overall score from the ten levers, are not in the

main focus of this thesis. However, the executed analysis might explore some helpful advice to

improve the HPO. At the end the fully developed HPO represents an advanced tool to provide a

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comprehensive analysis of the prevailing organizational culture, which serves as a necessary starting

point for cultural change. Since an assessment even of the most successful enterprise reveals space for

improvement (Sackmann, 2006).

The deduction of advice to boost the performance will be relinquished to the according experts and,

thus, are explicitly not part of this thesis. Ultimately, I will stick to the cultural theory of

transformational and transactional culture. Accordingly, I will not compare advantages or

disadvantages of the HPO with already existing measurement tools for different dimensions, like the

Organizational Cultural Profile (OCP) for cultural fit (O’Reilly III, Chatman, & Caldwell, 1991) or

Organizational Cultural Questionnaire (OCQ) for key characteristics (Sackmann, 2002).

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2 THEORETICAL BACKGROUND AND RESEARCH MODEL

At the beginning of the research model I present a detailed explanation of organizational culture by

Schein as a holistic illustration. Afterwards I will discuss different definitions before closing with

Jenewein’s and Heidrinks’s view. The following chapter narrows the perspective on culture into the

dimensions transformational and transactional. Thirdly, I debate the principles of culture measurement.

Eventually, I lead over from the theoretical part with an exhibit of the tools HPO and ODQ.

2.1 Dimensions and Definition of Organizational Culture

Organizational culture is such complex that only the declaration might cover a whole master thesis.

Though, it is helpful to explain one theoretical approach as an example in detail in order to make the

underlying requirements for designing a measurement tool understandable. In this work the description

by Edgar Schein is used, because of the acknowledgment of his opinion among different researchers

(Sackmann, 2006). Moreover, Edgar Schein represents one of the most notable researchers in the field

of organizational culture (Heidbrink & Jenewein, 2011). Thirdly, he uses a pure business perspective

on corporates with the goal to derive management implications to change the prevailing culture

(Schein, 2009). This method is in line with the approach of the HPO research team (Heidbrink &

Jenewein, 2011). Lastly, his model coheres with other well-known definitions (Becker, 2006; Hofstede,

Neuijen, Ohayv, & Sanders, 1990; Sackmann, 2006).

Figure 1 exhibits Schein’s separation of organizational culture into three different levels: artifacts,

espoused values and underlying assumptions (Schein, 2009). In the meantime there is an agreement

among researchers that culture comprises various levels or layers (Sackmann, 2006). The most visible

of those three layers are artifacts, like office design, dress code, how the employees greet each other or

the degree of technical terms used in discussion. Artifacts are very easy to observe even for outsiders,

who are not familiar with the concept of organizational culture. Yet, at this point we do not know the

reasons behind the noticed processes and structures. Therefore, we will need a justification what drives

the daily life of employees in order to understand the patterns.

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Figure 1: The three levels of culture.

The dimension explaining the artifacts and containing visions, goals, ethics, philosophies, principles

and strategies is called espoused values. At this level we already require an insider, who mentors us, as

if it would be our first day in the company. Explaining the values to us the insider will answer our

question why people behave like we observed. However, we might notice some inconsistencies

between the two already discussed levels. This is because the ultimate essence for values and actions

settles even one level deeper and is defined as underlying assumptions. Those are beliefs, perceptions,

thoughts and feelings of influential leaders or founders, which were proved to be key success factors

for the company in history. In time they become tacit, granted and jointly shared assumptions among

all employees. As people adapt these patterns unconsciously, we need to pick the right questions to our

insider to uncover this essence. Additionally, all underlying assumptions are interconnected with each

other in different strengths. They might be based on national backgrounds, personal traits and

educational background of important personnel, views about human nature and many other varying

factors.

We can imagine this whole cultural organization model as an iceberg. What we see is solely the top

above the water, but we are not able to guess how broad or deep it is without an abyssal dive into the

cold water.

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Altogether Schein defines culture more precisely as “a pattern of shared tacit assumptions that was

learned by a group as it solved its problems of external adaptation and internal integration that has

worked well enough to be considered valid and, therefore, to be taught to new members as the correct

way to perceive, think, and feel in relation to those problems” (Schein, 1990: 27)

This is far from being the only reference for definitions and characteristics of organizational culture.

One supplemental, wide spread naming (Becker, 2006: 4) for culture is “the entirely of norms, ideals

and mindsets, which form the behavior of employees’ from any hierarchical level and, thus, the

appearance of a company” (Puempin & Seminar, 1982). Another attempt to define culture is not

directly, however, rather indirectly by recognition features, e.g. Hofstede six characteristics: holistic,

historically determined, related to anthropological concepts, socially constructed, soft and difficult to

change (Hofstede et al., 1990). Those are examples from the economic sciences, there are over and

above countless denotations in various research fields. Just to touch on one somewhat dissenting, the

system theorist Simon reconsiders organizational culture as the sum of communications and channels

(Simon, 2009).

Eventually, it is fundamental to explain Jenewein’s and Heidbrink’s point of view by reason that the

HPO is based on it. They define organizational culture as “the sum of all prevailing behavioral patterns

of people, which constitute the organization” (Heidbrink & Jenewein, 2011: 7). Despite of their

acceptance and consideration of Schein’s definition of organizational culture, they rather try to reveal

the concept with a practical approach (Heidbrink & Jenewein, 2011). They follow the current scientific

discussions while looking for common patterns of successful high performance organizations

(Jenewein & Heidbrink, 2008).

2.2 Transformational and Transactional Organizational Leadership and Culture

Burns introduces the idea of transformational and transactional leadership in political research studies

(Burns, 1978). Bass adapted this leadership theory, based on the key proposition, that change is in the

center of leadership, into economic sciences (B. M. Bass, 1985). He conceptualized the full range of

leadership model with four transformational, two transactional leadership items and the supplementary

add-on of laissez-faire (B. M. Bass, 1985). Yet, laissez-faire is rather an own dimension than a factor

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and should be handled separately (Judge & Ronald F Piccolo, 2004). Ultimately, Bass embedded the

leadership concept into organizational culture (B. M. Bass & Avolio, 1993).

As noted above leadership and culture are inextricably connected. Hence, it is essential to understand

the underlying leadership theory in order to recognize the derived culture concept. Transformational

leadership is defined by four factors, called the “Four Is” in dependence on their first letter (B. M. Bass

& Riggio, 2012). Figure 2 shows a short summary of the main key description (Jenewein & Heidbrink,

2008) .

Figure 2: The four Is of transformational leadership.

Idealized influence also known as charismatic leadership with a good character means compendiously

for transformational leaders to act as a role model. This includes also high integrity, ethical behavior,

moral standards, risk taking and consistency in all actions. Good character leaders reap trust, respect

and finally identification. In this vein they are able to attract followers (Maccoby, 2000). The root for

the charisma may be both behavior, best summarized by the trite phrase “to walk the talk”, and

attributes of appealing charm.

The next component is called inspirational motivation. Leaders spawn commitment to a shared team

vision and challenging goals, comparable to goal-setting theory of stretch goals (Kerr & Landauer,

2004). They not only provide a purpose to the task, inspire the followers, but also communicate it

convincingly. Simultaneously, leaders radiate confidence, reliance and optimism about the achievement

of objectives. Due to the inspiration subordinates are willing to excel oneself. Transformational

leadership is in a figurative sense sparking motivation from inside out, i.e. pulling the intrinsic triggers

by the leader. On the opposite site it is outside in, i.e. motivation by incentives in particular monetary

bonus, which could be attached to transactional leadership,

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In transformational leadership each follower is contemplated individually. The leader serves as a

mentor and coach to the various needs and desires. Leaders practice a respectful two-way

communication, listen carefully to concerns and take them seriously. Additionally, the leader identifies

the strength, weaknesses and potentials of subordinates and evolves collectively with the followers a

development plan. Finally, leaders show authentic empathy and empower the subordinates to the

development of higher levels of potential through the individualized consideration.

The last item is named intellectual stimulation, which is the challenging of the current status quo

including all underlying assumptions. Leaders create an atmosphere of creativity, exchange and the

possibility of mutual criticism. The team analyzes problems from different perspectives. The leaders

encourage their followers to strike out in a new direction, actually even if this implies to fail.

Transformational leaders contradict the slogan “trust be verify”.

On the basis of the four Is Bass created a definition for transformational organizational culture. “In a

transformational culture, one fitting with the model of the four Is, there is generally a sense of purpose

and a feeling of family. Commitments are long-term. Leaders and followers share mutual interests and

a sense of shared fates and interdependence. A transformational culture like leadership can build on or

augment the transactional culture of the organization. The inclusion of assumptions, norms, and values

which are transformationally based does not preclude individuals pursuing their own goals and

rewards. This can occur at the same time where there is alignment with a central purpose and the

coordination required to achieve it. Leaders and followers go beyond their self-interests or expected

rewards for the good of the team and the good of the organization. […]. There is a rich set of norms

which cover a wide range of behaviors, norms that will adapt to and change with external changes in

the organization's environment. There is much talk at all levels in the organization about purposes,

visions, and meeting challenges” (B. M. Bass & Avolio, 1993: 116–118). The whole organization

shares one common long-term vision, accepts that future is not predictable and, consequently, focus on

adaptiveness (Heidbrink & Jenewein, 2011).

On the other hand transactional culture is reported as a market place (Heidbrink & Jenewein, 2011). All

internal services and efforts are traded quid pro quo and this mechanism is also embedded into the three

cultural levels. Accessorily, the relationship of supervisors and subordinates is rational and all tasks,

duties, conditions are explicitly formulated (B. M. Bass & R. Bass, 2008). Besides, punishment and

reward predominate the culture (McCarthy et al., 2008). All above, monetary incentives foster

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motivation whereas low output is punished by minor earnings. Bass explains transactional culture as

follows: “Commitments are short-term. Self-interests are stressed. […] Employees work as

independently as possible from their colleagues. Cooperation depends on negotiations not problem

solving or a common mission. Commitment is as deep as the organization's ability to reward members

for successful performance. There is little identification of the employees with the organization, its

mission or vision. Superiors primarily are negotiators and resource allocators. Relatively few behaviors

are determined by the norms of the organization, unless those norms reflect the transactional basis for

doing business in the organization” (B. M. Bass & Avolio, 1993: 116),

Transactional leadership is described by two items at which the second is executed in two dissimilar

ways (B. M. Bass & Riggio, 2012).

Contingent reward is the clear conceptual formulation and communication of expectations by the

leaders. The leaders reach an agreement with the followers of the existing objectives and,

contemporaneously, about the possible incentives offered in exchange.

The second item management by exception initiates leaders to carry out corrective action to avoid

deviations from the norm. Leaders might gear into the process actively, i.e. management by exception –

active, controlling and monitoring the performance of their subordinates tightly before serious

difficulties occur. Otherwise leaders may wait until an engagement is inevitable to avoid harm, i.e.

management by exception – passive.

The presented dimensions explained the extreme, pure theory of transformational and transactional

culture, however, typically companies possess a mixture of both (Heidbrink & Jenewein, 2011)

2.3 Measurement of Organizational Leadership and Culture

Bass developed a tool for measurement of the three leadership dimensions transformational,

transactional and laissez-faire named Multifactor Leadership Questionnaire (MLQ) (B. M. Bass, 1985).

The very first version consists of six factors – three transformational, two transactional and laissez-

faire. There was also evidence for two higher-order dimensions, which Bass entitled active and passive

leadership (Avolio, B. M. Bass, & Jung, 1999). In this way he was able to rearrange the original items

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by ranking them in the scales effectiveness and degree of activity. Figure 3 portrays the resulting order

from effective and active to ineffective and passive items (B. M. Bass & Riggio, 2012).

Figure 3: The full range of leadership.

Since its introduction Bass and his research group revised and re-validated the MLQ (Avolio et al.,

1999) as a response to critique. Despite of the discussions about the MLQ (Judge & Ronald F Piccolo,

2004; Yukl, 1999) it seems to be an appropriate tool (R F Piccolo & Colquitt, 2006) for

transformational and transactional leadership measurement and to be feasible in practice (Heidbrink &

Jenewein, 2011).

In contrary to the theoretical part it is not possible without further ado to copy the design of a

measurement tool from leadership to culture, due to the manifold complexity of culture. It already

starts with the difficulty of agreeing to the definition of culture (Sackmann, 2006a). After passing the

first hurdle in applying, e.g. Schein’s definition it is important to clearly distinct in which dimensions

culture should be evaluated (Hofstede et al., 1990). There are a lot of various completive or even

conflicting approaches reaching from four to fifteen dimensions (Sackmann, 2006b). While all those

models are arguable, this works uniquely focuses on organizational culture as the main part of a change

processes spanned by the two dimensions transactional and transformational (B. M. Bass & Avolio,

1993), as the HPO is based on it. The next emerging question about the perspective of culture

(Nerdinger, 2007) is also answered thereby, with culture modeled as a changeable construct. In this

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way the measurement of culture is the beginning of a whole process in order to make the organization

more effective by adapting the culture to the environment (Kotter & Heskett, 1992). Thus, the needed

purpose for assessment (Schein, 2009) is evidently to develop and change the current culture.

Eventually, the levels of culture, which should be investigated have to be assigned (Nerdinger, 2007). It

is crucial to record the visible and invisible parts (Parry & Proctor-Thomson, 2001) and to survey all

three levels to identify possible inconsistencies (Schein, 1990).

Altogether, the HPO fits into the theoretical model estimating culture on the horizontal axis, i.e.

theoretical models, based on transactional and transformational model and on the vertical axis, i.e.

cultural levels, holistically. Though, a questionnaire is only a first step to get a feeling of the as-is

situation and has to be succeeded by a workshops (Heidbrink & Jenewein, 2011). The best approach to

do that is by a mixture of quantitative surveys and questionnaires, interviews combined with workshops

(Nerdinger, 2007).

2.4 Organizational Description Questionnaire (ODQ)

Despite of the key role of culture for performance little efforts in research has been made to examine

culture in contrast to leadership evaluation (Parry & Proctor-Thomson, 2001). Bass introduced a

possible approach for assessment of organizational culture in analogy to the MLQ, namely the ODQ

(B. M. Bass & Avolio, 1993). The ODQ consists of a 28 item questionnaire, half for the transactional

and half for transformational dimension (cf. Appendix 6.1). The participants have to decide among

three answers “true”, “false” and “undecided”. For every “true” a point is added to the corresponding

dimension, while for any “false” a point is subtracted. At the end, the ODQ pictures every organization

to a [-14, 14] interval, represented in Figure 4 (B. M. Bass & Avolio, 1993).

Parry and Proctor-Thomson reexamined the validity and reliability of the ODQ (Parry & Proctor-

Thomson, 2001). The ODQ highlights a grand reliability with the standard measurement for internal

consistency Cronbach’s alpha amounts 0.74 for the transactional dimension and even 0.88 for the

transformational. Furthermore, the item-to-total correlation provides a satisfying result with the

exception of item 19, which is negatively correlated. Lastly, the factor loadings point in the very same

directions like the correlation analysis and reveals consistency in all items with exclusion of item 19.

This implies that the transformational scale features very accurate outcomes. On the other hand,

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convergence validity and reliability are given for the transactional axis, but the Factor Analysis

revealed a multidimensional solution. At this point we should keep in mind that a multidimensional

factor loading per se does not imply any issues with validity or reliability. Parry and Proctor-Thomson

advices further empirical and theoretical efforts to realign the ODQ.

Figure 4: Classification of the organizational culture by ODQ.

Besides, Bass designed the ODQ questionnaire elementary with merely 28 questions responded on a

dichotomy scale. This method oversimplifies the underlying culture (Parry & Proctor-Thomson, 2001),

which is one major flaw when dealing with culture (Schein, 1990). This plainness continues in the

outcome of the ODQ by singly ranking the overall culture in two dimensions. Consequently, there is

neither the chance to explore the different cultural levels nor to distinguish the various items of

transactional and transformational leadership.

Finally, the best theoretical model is worthless, if it is not practicable. Indeed, the usability and

practicability of the ODQ is doubted (Heidbrink & Jenewein, 2011; Parry & Proctor-Thomson, 2001).

Although various studies already used the ODQ for organizational culture measurement (Amburgey,

2005; Corrigan, Diwan, Campion, & Rashid, 2002; Toor & Ofori, 2009).

In sum, the ODQ illustrate a solid, reliable and almost consistent tool for a very generic culture

measurement, but lacks the inevitable broadness and deepness.

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2.5 The High-Performance Organization-Analyzer (HPO)

The research team grouped around Jenewein and Heidbrink developed the HPO as a measurement tool

for organizational culture based on theoretical foundation of transactional and transformational

leadership (Heidbrink & Jenewein, 2011; Jenewein & Heidbrink, 2008). Firstly, they examined high-

performance teams and organizations from economy, sport and artistic environment and deducted

common pattern in order to create a cultural assessment process. The name of the tool evolved from

this process. Next, they devised a questionnaire with 50 questions, which are answered on an ordinal

rating scale with four response options (cf. Appendix 6.2) to classify them into ten main categories the

so called strategic levers (Brenner, 2012). Figure 5 displays those together with their main

characteristics and description in case of pure transactional or transformational organizational culture

(Heidbrink & Jenewein, 2011).

Figure 5: The ten levers of HPO.

Profit and shareholder value

maximizationPurpose of existence

Deeper sense beyond monetary

rewards

Focus on monetary rewards on all

hierarchical levels, no vision or

mission statement

Communication of purpose

Anchoring of vision and mission

statement, spread and

communication on all hierarchical

levels

Low, everything is removable and

exchangeableEmployees' identification

High, organization is meaningful

and unique

Low, depending on individual cost-

benefit analysis, high willingness to

change

Employees' commitmentHigh, depending on reasonable

commitment

1. Purpose of Organization

Pu

re t

ran

sact

ion

al

Pu

re transfo

rmatio

nal

Clear reporting and responsibility

structure, independent of tasksHierarchy

No formalized reporting paths,

responsibilities based on expertise

Centralized power with tight control,

branch offices as executing agencies Importance of headquarter

Independent divisions and branches,

utilization of collective intelligence

Explicit description of workplace

and job, people are exchangeable

parts

Organization charts

Project based staffing of teams,

waiving of organization charts,

utilization of individual skills

2. Organizational Structure

Pu

re t

ran

sact

ion

al

Pure tran

sform

ational

- 20 -

Top-down, lower levels with low

discretion and budgetDecisions

Decisions by experts, subsidiary

principle - decisions taken on lowest

possible level

Top-down, military like, cascaded Information about taken

decisions

Low need, decision taker is usually

as well executer

Need for huge staff positions for

decision takers, preparation of

issues

Status of internal expertsDecision taking only by managers

with expertise, consulting by experts

Formalized process, final decision

by top management

Handling of employees’

ideas

Implementation of own initiative, try

and error approach in practice

3. Decision Making Process and Status of Internal Experts

Pure

tra

nsa

ctio

nal

Pure tran

sform

ational

Conservative, retain status quo,

change represents a menace

Attitude towards change of

employees

Flexible and adaptive, stagnation

represents a threat, refusal of status

quo advocacy

Change is a occasional project, long-

time periods of stability between

changes

Event vs. process

orientation

Change is a core characteristic,

belief in non-controllable shocks,

change as never-ending process

Enhancement of efficiency and

profitabilityPurpose of change process

Enhancement of adaptability and

flexibility, utilization of gained

experience for upcoming changes

Focus on error avoidance and

synergy effects

Error avoidance vs.

resources orientation

Ongoing search for unrealized

potentials, internal and external

focus on opportunities for

development

4. Organizational Dynamics

Pu

re t

ran

sact

ion

al

Pure tran

sform

ation

al

Extraordinary individual

performance, individual benefitsContent of heroic sagas

Collective achievements, altruistic

individual efforts, organization

benefits

Adaption of military and competitive

sports metaphors, efficient and

factual linguistic use, many

abbreviations

Phrases and metaphors

Adaption of ensembles and team

sport metaphors, emotional and

appellative linguistic use

Enforcement of own opinion in

competition, proclaiming styleMode of expression

Empathic and precautious style,

acceptance of inequality of own

opinion and truth, mutual search for

best alternative

Minute planning by top

management, usage to express top

management's opinion, head-on

presentations, rewards of individual

achievements

Character of celebrations

Spontaneous, mutual partying of

unexpected achievements, rough

planning with room for momentum,

unusual individual rewards

5. Rites and Legends

Pure

tra

nsa

ctio

nal

P

ure tran

sform

ation

al

- 21 -

Written, mandatory definition of

roles, independency of persons,

accurate fulfillment of requirements

Degree of formalizationDynamic roles in regard based on

projects, no explicit description,

Human beings as a part of a value-

added process, functional focus,

people are servants

Idea of man

Human beings as center of attention,

organization serves people, unique

contribution of each individual

Freedom for suggestions, decision

about implementation by supervisor,

no need for proactive insertion

Degree of autonomy

Freedom to act, own interpretation

of responsibilities and roles,

feedback culture, discretion in goal

definition

6. Autonomy at Work

Pu

re t

ran

sact

ion

al

Pure tran

sform

ation

al

Adaption to production line control,

employees as part of processes,

quality control tools

Need for control

Trust in intrinsic motivation, no

need for control, tacit acceptance of

failure

Tight control of quota, balanced

scorecards, performance KPI's Type of control

Control as sign of mistrust, no quota,

no fixed expectation

Errors as deviation of norm, critique

and sanctions for errors, intensive

search for culprits

Acceptance of errors

Motivation to try extraordinary

ways, acceptance of risk taking, no

blaming in case of errors

7. Control or Trust

Pu

re t

ran

sact

ion

al

Pu

re transfo

rmatio

nal

Internal marketplace, everything is

exchangeable at its specific price,

cooperation based on explicit

contracts

First principles of

cooperation

Commitment to superordinate

purpose

Silo thinking, internal competition

for key resources, focus exclusively

on area of responsibility, quid pro

quo principle

Silo vs. network orientationCollective resource allocation,

neural network as role model

Inter-company invoicing for

resources, requirement of supervisor

approval

Degree of formalization for

cooperation

Individual responsibility for

resources allocation, no supervisor

approval needed, no formalization

8. Types of Internal Cooperation

Pure

tra

nsa

ctio

nal

P

ure tran

sform

ation

al

- 22 -

The separation into ten levers endows the needed in-depth view on the culture. There is no clear

mapping of HPO levers with corresponding levels of Schein or other authors. As mentioned before the

team rather focuses on a practical than a theoretical course of action (Jenewein & Heidbrink, 2008). To

visualize the originated levers the team uses a mixing console as Figure 6 illustrates exemplary

(Heidbrink & Jenewein, 2011).

With this picture it is easy to identify the gap between the current organizational culture and a desirable

composition of the levers. Moreover, it is possible to differentiate among various employee groups, for

instance by age, job tenure and hierarchical level, or to benchmark the company within the industry.

This customized approach emphasizes the practicability of the HPO and the top management team to

provide tailor-made recommendations by levers for an action plan. It has already been used to assess

the culture of several organizations. In a first step the HPO evaluated the culture. Next, the

performance was discussed with the top management, which simultaneously served as a validation for

the tool.

Legitimacy of focus on self-interests,

discussions about individual cost-

benefit analysis

Handling of self-interests

Focus on general good, acceptance

of self-interests in case of not

harming overall goals

High in case of individual

performance, secret admiration for

clever exploitation of system

Tolerance of egomaniacs Low due to harm of team spirit

Huge discrepancy in salaries,

acceptance of difference based on

individual market value, high

bonuses based on individual goals

Compensation

Sensitivity for fair and justice

salaries no individual goals, bonuses

based on collective goals

9. Individual or Collective Interests

Pure

tra

nsa

ctio

nal

P

ure tran

sform

ation

al

Mangers instead of leaders, main

focus on results, planning and

resource allocation as key

instruments

Supervisors as role models

Ethical role models, high demand

for integrity and relationship

building, trust fostering

External motivation by monetary

incentives or promotionSource of motivation

Sense making, empowering,

illustration of individual

contributions to desirable collective

goal

Focus on preparation to task

fulfillment, specialist and technical

trainings

Personnel development

Employees as key assets, further

development, focus on soft skills

and personality trainings

10. Leadership Style

Pure

tra

nsa

ctio

nal

P

ure tran

sform

ation

al

- 23 -

Figure 6: Classification of the organizational culture by HPO.

In opposition to the ODQ the HPO does not express an overall score for the transformational and

transactional dimension. It only reveals results by levers on an interval scale [1, 5]. To create the

mixing console we have to transform the questionnaire interval from one to four into a five item scale.

With n defining the number of participants of one survey, m the number of questions belonging to the

corresponding lever (cf. Appendix 6.2) and q the answer of one specific participant to one question we

can calculate the score of one lever as followed:

������ ∶�4��� 1�3 � 1,������� ∶� 1��

1������

���

��� , !"�∀� ∈ %1,2, … ,10)*�+��� ∈ %1,2,3,4).

Practically, this stands for calculating the mean of all participants for one question, composing the

mean of all questions of one lever and executing a simple interval transformation.

In a last step the transformed results are classified by given ranges (cf. Appendix 6.3) into the five

categories: TF++ (strong transformational), TF+ (slight transformational), 0 (neutral), TA+ (slight

transactional) and TA++ (strong transactional). I will discuss the topic of varying scales in detail in the

result chapter when I compare both quantitatively. Here, it is notable that the transformation of the

assessed four item ordinal scale into a five item interval scale suggests a not given preciseness.

Particularly, against the background that it is not required for the further advancement.

- 24 -

Accessorily, the team altered the suggested dimensions in a significant sense. Jenewein and Heidbrink

see transactional and transformational as two antithetic values of one single continuum (Heidbrink &

Jenewein, 2011), conflicting with Bass’ approach of coexistent within the same continuum (B. M. Bass

& Avolio, 1993), yet, being in line with the primordial description of Burns (Burns, 1978). This means

the HPO records exclusively either transactional or transformational culture. In the ODQ may appear

simultaneously transactional and transformational culture. In the beginning Bass believed that

transformational culture is an extension or an add-on to transactional culture (B. M. Bass, 1985). In

time the two conflicting positions seem to accord slowly (Avolio et al., 1999). Besides, both research

groups forfeit the dimension laissez-faire completely (B. M. Bass & Avolio, 1993; Heidbrink &

Jenewein, 2011).

After all, in order to have a secured tool to measure culture, reliability as well as validity have

isochronally to be fulfilled. The HPO reliability was tested in detail (Brenner, 2012). Up to know it is

clear that all questions and levers point into the same direction, but we do not know, whether the HPO

really evaluates what it intends to assess, that is to say organizational culture. Hence, the concord of the

theoretical model and practical approach must be investigated.

- 25 -

3 METHODS

Initially, I will familiarize the participating four companies of the field study and the collected data

sample. Secondly, I elucidate the statistical models, simulations and tests I used for the analysis.

3.1 Respondents

In total we investigated four companies from very distinct industries. We collected the data in the

fourth quarter of 2012. Consecutively, the anonymous short profiles of the field study:

Company 1 is a long-year experienced non-governmental organization (NGO) based in Germany. The

company is staffed with over 20 full-time employees as well as with over 600 volunteers. For nearly

one century the organization acts as a broker for intercultural exchange programs. They offer a broad

range of possibilities to get in touch with foreign cultures.

Company 2 is a German based subsidiary enterprise of a Swiss technology group. The company

operates mainly in high-growth emerging markets and concentrates on certain systems for mass

production in photovoltaic industries. The key success factor in this fast paced industry is a quick time

to market process in order to become a market leader. After six years of rapid growth, the growth rate

begins to decelerate. The company was founded approximately twenty years ago and was formed by

the founder’s values representing the typical German engineering.

Company 3 is joint venture of a former Russian state-owned enterprise and a French multinational

conglomerate. Three-fourths of the 150 employees come from Russia the other fourth from European

Union countries. The goal of this joint venture is the implementation of a competitive challenger with

core activities in railway industry in order to acquire new projects focused on the development of

customer-oriented products.

Company 4 is a German research organization with three field offices focusing on applied science.

Recently, the company consists of four project teams, but one was integrated within the other existing.

The approximately 300 employees from various disciplines create interdisciplinary, complete,

innovative solutions combining science and engineering. The German government and industry

contracts are the financial base of this company.

- 26 -

Regardless the company each respondent filled in the HPO and contemporarily the ODQ within a

computer based questionnaire. The data sample of company 1 accounts nineteen respondents, whereof

five executives, 26%. Data quality was extraordinary high with only one missing value out of required

1482 answers (19 respondents with 50 HPO questions and 28 ODQ questions). The interviewees

represent a broad cross-section of job types: six from administration and management, four volunteers

and interns, four of the group and short-time program department, two from finance and one each of

school attendance Germany, school attendance abroad and miscellaneous.

We received 61 answers of company 2, but have to skip one, where at least all questions for one lever

of HPO or all questions for one ODQ dimension were not replied. After this elimination data quality

was in turn outstanding with solely one missing value out of required 4680 fields. Ten out of the

remaining 60 were replied by executives, which accounts for 17%. The respondents’ job tenure is

below two years for 28%, two up to five years for 55% and above five years for 17%. They worked for

research and development in case of 43%, in production 27%, in sales and services 15% and in

administration 15%.

For company 3 we collected 137 out of 150 possible fulfilled questionnaires amounting in an overall

response rate of 91%. Here we have to omit ten answer sheets due to missing values. This reduces the

response rate to still salient 85%. For the residual 127 persons we got 12 missing values out of the

needed 9906 queries. In this case before the handover we translated both questionnaires into Russian.

For the other three companies we inserted German versions. The sample consists of nineteen

executives resulting in 14% of total. Their seniority varies between below two years for 61%, two up to

five years for 26% and above five years for 13%. The business areas are represented as followed: 21%

operate for research and development, 77% for production and the remaining 2% in administration.

Nineteen employees returned the distributed questionnaire for company 4. Just as for company 2 we

need to eliminate one answer sheet. The remaining results contained two missing values out of all 1404

single values. Sixteen staff member with managerial responsibility, enumerating 89%, and two without

participated in the survey. Among them were fourteen or 78% with a permanent employment

relationship. 28% of employees work two up to five years and the remaining 72% above five years for

company 4.

Furthermore, we asked the insider experts in charge of the data assessment to reply the questionnaires

as well. Those are people being familiar with the topic of organizational culture and working or

- 27 -

accompanying the regarding companies for several years. Of course they executed the evaluation a

priori to originate independent and unbiased results. They returned a paper and pencil version of the

HPO and ODQ. Accessorily, they evaluated the organizational culture in a qualitative way guided by

the description of the ten strategic levers as presented in Figure 6. We inquire them for a narration of

their own company using their own words. As a help they had a short specification of pure

transactional and transformational culture. Unfortunately, we could not obtain a qualitative analysis for

company 3 from the expert. Altogether, I believe that the deliverables are suitable to serve as a data

base for the study.

3.2 Measures

One of the biggest issues to tackle is the transformation of scales, scilicet how to map the separated

transactional and transformational dimensions of the ODQ with one continuous dimension within the

HPO. I do not approach the scale transformation from four to five items for the HPO before mapping,

because I do not see any advantage doing so, but, rather an unneeded enhancement in complexity. I

also refuse to unfold the HPO results into TF and TA axis as proposed by the following formula.

����� ∈ -.1.00, 2.500 → 234. 14,14002.50, 4.000 → 254. 14,140

In this way we would activate only one dimension of the ODQ, while not taking the other into account.

In lieu thereof I favor to consolidate the ODQ dimensions into one continuum. Following the logic, that

transactional and transformation cultures are the antithetic poles of the same scale we should add

negative transactional values to the transformational dimension and vice versa. Subsequently, we have

to map the resulting range of -28 to 28 to the HPO range and receive summing up the related formula.

67"��89: ∶� 367"��;< 67"��;=�56 � 2.50

We have to keep in mind at this stage that the mapped scale remains ordinal just like the HPO scale.

The next challenge we are faced with is to accumulate all ten lever results into one overall score for

HPO. Again we have different possibilities for the further proceeding. The selection of this method

might influence the conclusion significantly. Therefore, this time I will choose two different methods in

- 28 -

order not to bias the test by this decision. As the creation of an overall score is still pending for the

Jenewein and Heidbrink research team the results might help them and the discussion may deliver

some new insights.

The simplest estimator to aggregate the individual lever score is to weight all equally, i.e. arithmetical

mean. The disadvantage for this technique is that levers with ten questions and levers with four

questions will be treated with equal measures. Further, we do not take discrepancies in sensitivity or

underlying frequency distributions into consideration. Though, without availability of continuative

information it is still a best a priori estimator.

Alternatively, we could estimate the lever weights by a non-parametric regression with the experts’

opinion as a dependent variable (Hartung, Elpelt, & Klösener, 1998). In the event of accepting the

ODQ as the reference we could also use the ODQ score as a dependent variable. The downside of this

modus operandi is that we optimize the measure in regard to the expected estimators and, accordingly,

distort the later used test statistic. That is why this procedure is not applicable for this study. Whereas it

might be the most suitable method in order to generate an overall score.

Another solution determined by the surveyed data is the selection of weights by Factor Analysis (Falk,

Marohn, & Tewes, 2002). In this case we are going to use the underlying statistical spread of the levers

as weights. We have to force the number of resultant factors to one for this procedure. Besides, I will

not constraint the model by any further specifications. Hence, the implemented Factor Analysis

portrays an explorative modality. As a technique for factoring I choose the Principle Component

Analysis (PCA). This is the most common and intuitive way to estimate the factors. Since we can

assume that our observations are real numbers as a sum of at least four natural numbers we fulfill all

necessary conditions for Factor Analysis via PCA. Empirically the factors are not very sensitive in

regard to the applied technique anyway. For matrix diagonalization I prefer to use the correlation

matrix instead of the covariance matrix, because it makes the interpretation of the results plainer.

Certainly, the determination of any rotation makes no sense owing to the one factor hypothesis. I

interpolate the rare missing values by means of the other respondents’. Thereinafter, we again have to

map the results to a one to four item scale to make them comparable with the raw levers. Finally, I

decide to weight all four companies equally and to calculate the final weights as an average of four

company’s weights, in place of weighting by participants or deviation. From my perspective the main

distinguishing feature is the intercompany assessment rather than interpersonal assessment.

- 29 -

If possible, I will try to use non-parametric methods for tests of significance, because from my point of

view both questionnaires produce ordinal scaled data. On the one hand there is no doubt about the scale

for the HPO, on the other hand the overall scores for both ODQ dimensions are a sum of 14 dichotomy

variables and, therefore, very unlikely to be accurate enough to deduct quantitative metrics. For

instance, one company is three times as transformational as the other company. Moreover, Bass

originally used merely nine types capable of being differentiated as presented in Figure 4. In general

this acknowledgment forces the results and methods to be more conservative. Eventually, we are not

able to maintain a normal distribution approximation for the smallest two data sets with eighteen and

nineteen observations (Sachs & Hedderich, 2009).

Although we are allowed to skip the underlying parametrical distribution assumption for non-

parametric procedures, by definition we need independent and identically distributed random (i.i.d.)

variables with a continuous distribution function. I do not see any issues for the i.i.d. proposition, but

we cannot presume a continuous distribution without loss of generality. Nevertheless, for discrete i.i.d.

variables we are free to use most non-parametric statistic approaches, if we do not have a sufficient

amount of rank ties (Hartung et al., 1998). Due to the fact, that we do not test the raw data, but rather a

linear combination rank ties become rare. I mention this issue separately for any test statistic in case of

numerously rank ties appearance.

To evaluate the correlation and, therefore, to ensure the convergent validity of the HPO-Analyzer

towards the ODQ I will use Spearman's Rank Correlation Coefficient in order to respect effects of all

orders (Hartung et al., 1998).

I assign the null model for the discriminant validity as a simple discrete uniform distribution of the

numbers one, two, three and four, i.e. four-sided dice. It might be possible to generate a more

sophisticated model, for instance by choosing the probabilities according to the appearance among the

survey. Yet, the ultimate purpose of a null model is to represent a pure by chance outcome without any

in-depth premises.

To test the validity of the questionnaires against the null model I accomplish the Wilcoxon-Signed-

Rank-Test, the standard non-parametric alternative for matched-pairs and one sample tests (Hartung et

al., 1998). After defining the test statistic, we need to cope with the mass of data and adjust the level of

significance to our multiple tests. Hence, where required I will make use of the Holm-Bonferroni

method also known as Sequential Bonferroni Correction (SBC) (Sachs & Hedderich, 2009). This

- 30 -

practice enables us to consider the issues in regard to multiple tests while solving the problem feasibly

without harming the level by the gravity of the often approached, pure Bonferroni correction (Sachs &

Hedderich, 2009).

From a statistical perspective the test of accordance is very challenging. Notwithstanding, most of the

literature alludes tests of equality, there are few solutions suggested for such problems (Bortz, 2005;

Falk et al., 2002; Hartung et al., 1998). The common way to test the null hypothesis of inequality is to

control the test power or effect size, but this represents a less-than-ideal solution (Bortz, 2005; Sachs &

Hedderich, 2009). The developed test statistic for this issue is based on a normal distribution called two

one-sided tests (TOST), which belongs to the family of equivalence tests (Sachs & Hedderich, 2009).

In this event, we need to fulfill the regular pre-condition as for the Student's t-test (Sachs & Hedderich,

2009). As we only test the accumulated data on a lever base, we have at least a sum of four ordinal

variables for a minimum amount of eighteen persons. The data sets might not be normal distributed, but

at least do not profoundly violate the requirements. I deliberately do not test for normality of the

distribution, since regardless to the result there are no alternatives to the equivalence test. Eventually, I

determine the thresholds for tolerance with a value of 0.5, which is very broad by reason that the

experts' data set consists only of one opinion and, consequently, might not be balanced out in

comparison to the employees’ evaluation. This border allows us to test a positive and negative

dispersion of 20% about the mean.

As alternative statistical hypothesis testing we might execute a goodness of fit test for discrete

variables, e.g. Chi-Square (Falk et al., 2002). Though, with this procedure we rather validate the item

classification (cf. Appendix 6.3) and not the raw data collected by the questionnaire. Based on this

noted bias I refuse this possibility.

In a last step, I will check the expert’s HPO results against their qualitative assessment of the ten

strategic levers. This qualitative accordance test will not contain any judgment about the predominant

culture. Its exclusive purpose is to identify disagreements among the description and answers.

For the sake of completeness I like to refer, that I carry out all statistical routines with IBM® SPSS®

Version 21, with exception of the equivalence test. This test statistic I had to execute manually with R

Version 2.15.2 (Sachs & Hedderich, 2009), because SPSS is not capable to provide this test.

- 31 -

4 RESULTS

Prior of drawing conclusions with statistical tests and dive deep into the main study I like to summarize

the prevailing data samples as well as to generate easily interpretable graphic. This groundwork is

necessary in order to fully understand the data before executing the right test. Besides, I prepare the

data for the statistical tests. In a last step I am going to compare the qualitative expert description with

the questionnaire results.

4.1 Descriptive and Explorative Statistics

The simplest way to visualize the expert valuation with the employees’ assessment for the HPO is to

mark them both in the HPO mixing console at the same time (cf. Appendix 6.4 – 6.7). However, due to

the classification into fixed five categories we are not able to quantify the gaps in this graphics

precisely.

We grasp them as a relative measure of deviation among experts and employees in percent (Delta)

together with mean, standard deviation (S.D.) and raw expert opinion in Table 1 by company and lever.

For company 1 the difference ranges from -7% up to -27%. Interestingly, the expert constantly

overestimates the transformational dimension, represented by the negative algebraic sign. The second

expert creates much lower margins with a maximum amount of -15 percentage points. Overall

company 2 displays a more transactional culture in comparison to company 1 in regard to the experts as

well as employees’ view. Thirdly, company 3 represents an even more transactional culture. The expert

overestimates this time in contrast to company 1 the transactional component. The expert’s belief varies

from -14% up to 31% from the respondents’ average. The range of the delta for company 4 is the

largest among all. It reaches from -16% to 30%. In total the expert evaluates the company’s culture as

more transactionally formed than the participants.

In sum, the standard deviations are quite stable within companies’ levers, but vary among companies.

There are no patterns, whether the employees under- or overestimates one dimension in regard to the

experts’ opinions.

- 32 -

Table 1: Descriptive statistics for HPO levers.

Table 2 displays the descriptive statistics for the ODQ. For company 1 we see a very strong

transformational culture in combination with an underrepresented transactional influence. According to

the classification of Figure 4 company 1 is predominated by the four Is concordantly by expert’s and

participants’ view. The table reveals for company 2 increasing inter (between expert’s and participants’

beliefs) and intra (between participants) deviation in comparison to company 1. If we trust in the

expert’s point of view we have again a four I company. On the other hand the respondents rather group

company 2 into the coasting group. Transactional and transformational impacts contemporarily can be

observed for company 3. The employees declare the company as infused by moderate four Is while the

expert accredits it as moderate contractual. For company 4 as for the HPO we have the biggest

disagreement between the expert’s classification into predominately contractual and employees’

judgment of moderated four Is. Another visualized, explorative interpretation for the data is presented

by their scatter plots (cf. Appendix 6.8 – 6.11).

In addition to the classifications we are able to see at first glance a severe departure of experts’

evaluations from questionnaire results for the transactional dimension (TA) and a lower difference for

the transformational (TF). The high discrepancy of up to -1350% is owed by the larger scale of the

ODQ and, consequently, not comparable one-to-one with the outcomes of Table 1.

Table 2: Descriptive statistics for the ODQ dimensions.

Mean S.D. Expert Delta Mean S.D. Expert Delta Mean S.D. Expert Delta Mean S.D. Expert Delta

Lever 1 3.16 0.36 4.00 -27% 2.46 0.46 2.60 -6% 2.46 0.44 2.00 19% 2.52 0.41 2.40 5%

Lever 2 2.79 0.52 3.00 -8% 2.60 0.61 3.00 -15% 1.95 0.61 1.75 10% 2.38 0.48 2.75 -16%

Lever 3 3.18 0.55 3.40 -7% 2.45 0.67 2.80 -14% 2.32 0.52 1.60 31% 2.48 0.55 2.60 -5%

Lever 4 3.04 0.50 3.60 -18% 2.44 0.54 2.20 10% 2.72 0.41 2.40 12% 2.56 0.44 2.60 -2%

Lever 5 3.11 0.50 3.75 -21% 2.76 0.43 2.50 9% 2.38 0.52 1.75 26% 2.08 0.52 2.00 4%

Lever 6 3.03 0.46 3.50 -16% 2.83 0.48 3.00 -6% 2.31 0.45 2.50 -8% 2.74 0.49 2.50 9%

Lever 7 3.20 0.49 3.75 -17% 3.05 0.48 2.75 10% 2.41 0.50 2.75 -14% 2.64 0.71 2.25 15%

Lever 8 3.28 0.56 4.00 -22% 2.76 0.61 3.00 -9% 2.60 0.45 1.80 31% 2.98 0.56 2.40 19%

Lever 9 3.03 0.43 3.75 -24% 2.84 0.48 2.75 3% 2.79 0.59 2.00 28% 2.86 0.42 2.50 13%

Lever 10 3.23 0.45 3.90 -21% 2.82 0.44 2.70 4% 2.68 0.45 2.70 -1% 2.87 0.55 2.00 30%

Company 4 (n = 18)Company 2 (n = 60)Company 1 (n = 19) Company 3 (n = 127)

Company n Mean TA S.D. TA Expert TA Delta Mean TF S.D. TF Expert TF Delta

C1 19 -6.84 4.18 -9 -32% 9.58 3.88 12 -25%

C2 60 -1.68 6.04 -9 -436% 4.73 5.56 8 -69%

C3 127 2.35 3.62 8 -240% 6.13 5.27 2 67%

C4 18 -0.56 6.53 7 -1350% 6.61 5.65 -7 206%

- 33 -

To confront both tools directly we execute the transforming and mapping methods noted in chapter 3.2

for both scales. Table 3 indicates the weights and communalities provided by the Factor Analysis. The

negative weights for two levers of company 3 surprise in this context. By this reason we achieve

unsatisfying communalities particularly for levers 2 and 6. The other eight levers possess excellent

positive factor loadings with a minimum of 0.59. However, taking the communalities into account our

one factor model is not capable of explaining the deviation of the data set. A multifactor model is also

suggested by the scree plots of the Factor Analysis with at least two eigenvalues above one (cf.

Appendix 6.12 – 6.15). We achieve to model 49% of the total variance for company 1, 39% for

company 2, 30% for company 3 and 53% for company 4. Accordingly, at this stage we lose a portion of

the power to predict the organizational culture, but without this simplification we would not be able to

enforce a one-on-one comparison of both questionnaires.

Table 3: Factor Analysis results for HPO scale transformation.

Ultimately, Table 4 presents the relation between the HPO and the ODQ with their transformed mean

and standard deviation. We receive model 1 for the HPO (HPO1) while applying the results from

Factor Analysis and converting the range of the HPO overall score into the interval one to four. The

exact weights are presented in Appendix 6.16. We obtain HPO2 by using equal weights for all strategic

levers. The ODQ overall scores are formed by a combination of the transactional and transformational

dimension and subsequently a simple scale transformation. We observe that the methods of

transformation for the HPO do not influence the results severely. It is explainable that the standard

deviation of HPO1 exceeds HPO2 based on the variance modeling of the Factor Analysis. More

important the standard deviation of the HPO is lower for every company independent of the method.

We might conclude that a smaller variance attests a better measurement tool. Hence, the HPO owns an

advantage for measuring of organizational culture, especially for small data samples.

Company 1 Company 2 Company 3 Company 4 Mean Company 1 Company 2 Company 3 Company 4 Mean

Lever 1 0.85 0.56 0.37 0.66 0.61 0.72 0.32 0.13 0.43 0.40

Lever 2 0.48 0.47 -0.12 0.73 0.39 0.23 0.22 0.01 0.54 0.25

Lever 3 0.79 0.68 0.69 0.66 0.70 0.62 0.46 0.48 0.43 0.50

Lever 4 0.72 0.59 0.56 0.79 0.67 0.53 0.35 0.32 0.63 0.46

Lever 5 0.67 0.39 0.41 0.84 0.58 0.45 0.16 0.17 0.70 0.37

Lever 6 0.21 0.51 -0.18 0.34 0.22 0.04 0.26 0.03 0.11 0.11

Lever 7 0.73 0.73 0.36 0.88 0.68 0.53 0.53 0.13 0.77 0.49

Lever 8 0.67 0.79 0.72 0.79 0.74 0.46 0.63 0.51 0.62 0.55

Lever 9 0.80 0.63 0.76 0.60 0.70 0.64 0.40 0.57 0.36 0.49

Lever 10 0.83 0.78 0.83 0.84 0.82 0.69 0.61 0.68 0.71 0.67

Weights Communality

- 34 -

Table 4: Comparison of HPO and ODQ transformed overall scores.

Table 5 unites the separated results from Table 1 and Table 2 adopting the same transformation as

mentioned before. For the second time the results are not sensitive in matters of mapping procedure.

The relative deviation is lower for the HPO for three out of four companies. From a descriptive point of

view the HPO seems to subdue the ODQ in regard to accuracy, i.e. accordance of expert’s and

employees’ opinions.

Table 5: Comparison of experts’ HPO and ODQ transformed overall scores.

Figure 7 combines the individual results of all four companies with the transformed ODQ overall score

on the abscissa and the transformed HPO overall scores via equal weights on the ordinate. We can

clearly observe the strong correlation for all four companies as well as even for the whole dataset.

Auxiliary, the relationship seems to be linear. I waive the visualization for the second HPO model

according to the small differences.

Company Mean ODQ Mean HPO1 Mean HPO2 S.D. ODQ S.D. HPO1 S.D. HPO2

C1 3.38 3.13 3.11 0.39 0.35 0.33

C2 2.84 2.70 2.70 0.56 0.34 0.32

C3 2.70 2.51 2.47 0.39 0.27 0.25

C4 2.88 2.63 2.61 0.55 0.39 0.37

Company Expert ODQ Expert HPO1 Expert HPO2 Delta ODQ Delta HPO1 Delta HPO2

C1 3.62 3.71 3.67 -7% -19% -18%

C2 3.41 2.71 2.73 -20% 0% -1%

C3 2.18 2.13 2.13 19% 15% 14%

C4 1.75 2.37 2.40 39% 10% 8%

- 35 -

Figure 7: Scatter plot of transformed ODQ and HPO overall scores.

4.2 Inferential Statistics

Since the explorative statistic astonishingly disclosed that both transformation methods by Factor

Analysis and by equal weights are resembled, which is confirmed by Spearman's Rank Correlation

Coefficient with a value of at least 0.97 for all four companies, I continue with only one of the two

propositions. I stay with the equal weights model, because of its simplicity and the creation without any

methodological tools.

Table 6 shows the Spearman's Rank Correlation Coefficient for all companies between ODQ and

HPO2 overall scores. The correlation is very strong for the four companies and the related p-Values

notify a Rho value dissimilar of zero after SBC. In sum, the analysis forcefully provides convergent

validity of the HPO-Analyzer towards the ODQ and confirms the HPO as a valid measurement tool for

the evaluation of organizational culture.

1,00

1,20

1,40

1,60

1,80

2,00

2,20

2,40

2,60

2,80

3,00

3,20

3,40

3,60

3,80

4,00

1,00 1,20 1,40 1,60 1,80 2,00 2,20 2,40 2,60 2,80 3,00 3,20 3,40 3,60 3,80 4,00

HP

O

ODQ

Company 1 Company 2 Company 3 Company 4

- 36 -

Table 6: Spearman's Rank Correlation Coefficient for overall score.

A detailed analysis for any lever is presented in Table 7 for information purposes. In this case it does

not make sense to denote the p-Values, as we are not able to derive any implication or collateral

information from those as well as the correction for multiple tests would force us to test on alpha levels

starting at 0.00125. Once more, lever 2 and 6 diverge from the overall very good correlation. Although

the issues rather pertain the reliability than the validity a revision of both might be helpful in order to

improve the validity. Accessorily, the validity for the levers of company 3 is the weakest, which was

already reported by the lowest overall correlation, though it was not indicated by the descriptive

statistics.

Table 7: Spearman's Rank Correlation Coefficient for all levers.

The next step to achieve construct validity for the HPO is to confirm discriminant validity, i.e. differ

from a pure random model. I used the Wilcoxon-Signed-Rank-Test for matched pairs and received for

company 1 (z = -3.42, p < 0.001) and for company 2 (z = 3.41, p < 0.001) significant differences from

the null model after SBC. Admittedly, the measurement of organizational culture for company 3 (z = -

0.22, p = 0.82, one rank tie) and for company 4 (z = 1.90, p = 0.06) does not vary from by chance

answers. This result is even more alarming in terms of our very simple null model. These observed

patterns, presented in Table 8 might be a sign of low predictive power for balanced, i.e. near 2.50,

organizational cultures. To eliminate possible biases by transforming method I re-executed the test with

HPO1 model, however, the conclusions about acceptance or rejection of the null hypothesis did not

change. For the unlikely event of an extreme distribution of the random number in the null model I also

rerun the test with a new random data set and repeatedly got the same evidence for HPO1 and HPO2.

Rho

* p < 0.005

0.63* 0.82* 0.52* 0.81*

Company 4 (n = 18)Company 3 (n = 127)Company 2 (n = 60)Company 1 (n = 19)

Lever 1

Lever 2

Lever 3

Lever 4

Lever 5

Lever 6

Lever 7

Lever 8

Lever 9

Lever 10

0.50

0.51

0.49

0.650.59 0.59 0.70

Mean

0.48

0.28

0.45

0.53

0.42

0.10

0.58 0.43 0.50

0.59 0.53 0.35

0.40 -0.17 0.24

0.55 0.14 0.83

0.36 0.43

0.50 0.35 0.61

0.20 0.22 0.69

0.52

0.47

0.71

0.45 0.21 0.74

0.36 -0.03 0.54

0.59

0.53

0.25

0.44

0.65

0.56

-0.06

0.49

Company 1 (n = 19) Company 2 (n = 60) Company 3 (n = 127) Company 4 (n = 18)

- 37 -

Definitely, the research team should take this work as a starting point to realign the discriminant

validity.

Table 8: Comparison of HPO data with a null model.

Table 9 pictures a deep dive into the test statistic of the Wilcoxon-Signed-Rank-Test for all levers.

Although the ordinal scaled p-Values are the best specification of similarity we should not make the

mistake of comparing them to alpha levels thanks to the strict SBC for multiple testing. With Table 9

we have the ability to discover the reasons for the failed discriminate validity. The explication might be

inserted in levers one and seven having the biggest gap of the two failed companies to the successful

ones. Company wise on the one hand the levers for company 4 badly discriminate from the null model,

on the other hand for company 3 only the two mentioned levers seem to be responsible for the

deviation. Interestingly, company 2 does also possess two dissenting levers, which on the contrary do

not influence the overall result.

Table 9: P-Values of Wilcoxon-Signed-Rank-Test for all levers.

The last qualitative test carried out is the evaluation of accordance between the employees’

questionnaire results and those of expert’s. Table 10 displays the test statistics for the two HPO models

and put them directly into perspective with the necessary p-Value for significant accordance of an

alpha-level of 0.05. A test value less than the threshold stand for an equivalent cultural assessment.

Company Mean NULL Mean HPO2 S.D. NULL S.D. HPO2

C1 2.57 3.11* 0.14 0.33

C2 2.53 2.70* 0.18 0.32

C3 2.48 2.47 0.17 0.25

C4 2.45 2.61 0.19 0.37

* p < 0.005

Lever 1

Lever 2

Lever 3

Lever 4

Lever 5

Lever 6

Lever 7

Lever 8

Lever 9

Lever 10 <0.01 <0.01 0.01 0.01

0.01 <0.01 <0.01 0.04

0.02 <0.01 <0.01 0.05

0.01 0.02 <0.01 0.47

0.01 <0.01 0.52 0.23

0.04 0.42 <0.01 0.20

0.01 0.01 <0.01 0.18

0.12 0.09 <0.01 0.18

<0.01 0.94 <0.01 0.90

Company 1 (n = 19) Company 2 (n = 60) Company 3 (n = 127) Company 4 (n = 18)

<0.01 0.09 0.62 0.46

- 38 -

With exception of company 2 no one of the other companies’ questionnaire results accords to the

expert’s opinions. Against the background of the very broad acceptance levels of an overall deviation

of 40%, we have to assume that the results differ.

Table 10: Test statistics of equivalence test for overall score.

In analogy to the previous interferential tests Table 11 provides the more detailed analysis for all

levers. We can see at the very first glance, that even without Bonferroni Correction at most two levers

significantly accord per company. This picture underlines the differences of the results for all

companies.

Table 11: Test statistics of unpaired equivalence test for all levers.

4.3 Qualitative Comparison

This chapter is an extension of the main study and connects the quantitative estimations by experts

from Table 1 and Table 5, visualized in the mixing console (cf. Appendix 6.4 – 6.7), with their

qualitative opinions (cf. Appendix 6.17 – 6.19). The primary point of reference for this confrontation is

the mixing console, as it mirrors the state-of-the-art method of Jenewein and Heidbrink to classify

culture. According to the benchmarking process (cf. Appendix 6.3) these results may severely vary

from a uniform distribution, e.g. the transformed scale center of 2.50 (= 3.13) is strong transactional

(TA++) for lever 8, while slight transformational (TF+) for lever 6.

p-Value (α = 0.05)

5.93

15.86

0.41

0.23

7.40

7.22

Company 1 (n = 19) Company 2 (n = 60) Company 3 (n = 127) Company 4 (n = 18)

0.57 2.20 3.95 0.52

2.47

2.83(HPO1)

(HPO2)

Lever 1

Lever 2

Lever 3

Lever 4

Lever 5

Lever 6

Lever 7

Lever 8

Lever 9

Lever 10

p-Value (α = 0.05)

6.49 2.11 0.50 6.71

0.57 2.20 3.95 0.52

5.60 3.05 20.03 4.39

7.30 1.45 15.09 3.64

4.45 2.74 4.76 2.08

4.89 4.84 7.66 2.33

4.88 3.44 8.80 0.39

5.58 4.68 13.65 0.65

1.76 5.08 3.69 3.27

1.74 4.05 15.60 0.93

Company 1 (n = 19) Company 2 (n = 60) Company 3 (n = 127) Company 4 (n = 18)

10.17 2.36 11.78 1.24

- 39 -

For company 1 we see in the mixing console a pure transformational organizational culture along with

high score values for any lever. For levers 1, 4, 5, 6, 8 and 9 there are no doubts in the description

about the pure transformational culture. In regard to the comments, lever 2 supposes to be the most

transactional one, which is in line with the lowest score of 3.00 for this lever. The decision process

(lever 3) follows the subsidiarity principle and decisions are mainly taken by experts, thus, it represents

a transformational culture. A controlling department monitoring the company is nothing remarkable,

whereas the type and need for control point repeatedly into the transformational description (lever 7).

From my perspective lever 10 is the only with a small discrepancy among qualitative and quantitative

outcomes. Leaders change their behavior under pressure which diverges from the transformational

evaluation, i.e. nine of ten answers with pure transformational leadership.

In a nutshell, the accordance of the questionnaire results and expert’s description is very high.

The evaluation of company 2 is more complex due to the fact that the overall trend is not that clear as

for company 1. To start with lever 4 as the pure transactional lever, this one is consistent with the

expert’s report, which underlines the current transactional culture, for instance error avoidance or event

orientation. The next one with a slight transactional tendency is lever 5, whereof I derive from the

statement that it is rather transformational than transactional. Notwithstanding of the loss of spontaneity

emphatic cooperation as well as collectivism are prevailing in the company. In this case I believe in an

excursion of accordance. For the next slight transactional lever 10 we have an alignment in quantitative

and qualitative assessments. The same is true for the neutral levers 7, 8 and 9, yet, not for lever 1 which

again differs heavily from the narration in particular by the lack of a non-monetary vision and bad

communication of the headquarter. Examining the levers 3 and 6 we might argue, if they are slight or

strong transformational, but the trend is clearly transformational for both. The last lever number 2 is in

concern of the recent restructuring not evaluable.

In sum, the concord is violated for two levers strongly. However, we should be cautions at this point

against the background of the structural changes. Additionally, company 2 seems to have different

cultures in the research & development and production departments, which might limit the expert’s

opinion.

Following the numerical order of company’s 4 levers we are able to observe an accordance of

qualitative and quantitative results for the lever1. The same is true for levers 2 and 3. Whereas I believe

that the description of lever 4 classifies it as pure transactional, the expert files it as slight transactional.

- 40 -

Admittedly, it is hard to precisely rate discrepancies of one class. The expert’s overall narration for the

levers 5, 7, 8, 9 and 10 of a transactional company fits to the HPO mixing console, but the expert

constraints that there are transformational teams within the organization. From my perspective the

arguments for lever 4 can be transferred to lever 6. I consider it more transactional than the HPO.

Concentrating company’s 4 comparisons the general tendency is given for most of the levers.

Particularly, in this case it is not possible to contrast the transactional description of the whole company

against the transactional characterization of certain teams.

- 41 -

5 DISCUSSION AND FUTURE RESEARCH DIRECTIONS

In the final discussion I want to establish a reference to the aspiring main and supplementary goals. I

also like to emphasize the implications of this work for further research in order to improve the HPO.

Secondly, I will refer to the constraints of this work as well as the weaknesses due to the taken

assumptions. In the end I like to add a short personal note on the necessity of the development of

measurement tools for organizational culture in its entirety.

5.1 Summary, Implications and Recommendations

To approach the HPO unscrupulously and deduct implications this tool needs to be validated. This

study examined thoroughly different facets of a validation process. Above, all ten levers were

investigated in all descriptive and analytical steps. Doing so, we are able to link all findings directly to

their sources. Altogether, this HPO validation exceeds the usual validation studies for comparable tools

methodically by far (B. M. Bass & Avolio, 1993; O’Reilly III et al., 1991).

Moreover, the validation was carried out not only on one data sample (Hofstede et al., 1990), but for

four different companies from various industries. We achieved in general a very good coverage of the

whole firm with an outstanding data quality. The database is not biased by different points of time and

all comparisons were carried out by the same frameworks and circumstances within all four firms. In a

nutshell, this diversification helps to underline the robustness of this study as well as it enables to test

the applicability on different settings.

Firstly, this study confirms the convergent validity of the HPO towards the ODQ on a significant level.

There are no doubts that the HPO and the ODQ measure the same characteristics of organizational

culture. If we believe that the ODQ quantifies organizational culture appropriately (Parry & Proctor-

Thomson, 2001) than the HPO does the same. Though, the HPO possesses a lower volatility among

participants’ results and, hence, might be the more appropriate tool for small companies. Another

benefit of the HPO is the separation into ten strategic levers which allows a more detailed analysis of

organizational culture. Eight out of ten levers seems to be concordant with the ODQ measures.

Based on the convergent validity assessment I think that, especially the reliability for levers 2 and 6

should be revised with the new database. The utilized Factor Analysis supports this conclusion as well.

- 42 -

In general, the Factor Analysis findings with a multifactor model reveal that adjustments of the

questionnaire might lead to a higher reliability. In an accustomed procedure the reliability and validity

tests should be carried out on a regular base in case of a data base extension. I recommend making use

of non-parametric methods for the item selection by replacing the Pearson Product-Moment Correlation

coefficients by Spearman's Rank Correlation Coefficient. Alternatively, the Jenewein and Heidbrink

research team may employ Rausch-Models to solve the issues implied by an ordinal scale (Rasch,

1961). Unfortunately, a regular validation cycle is rarely executed for the existing measurement tools

for cultural assessment (Parry & Proctor-Thomson, 2001).

Secondly, the discriminant validity is not fulfilled for the HPO. The HPO questionnaire responses from

employees do not significantly differ from complete random patterns. There might be different causes

for this failure. From my point of view the most probable one is that the scale of one to four within the

questionnaire occupies too low prediction power, in particular close-by the center of the data. The two

companies with a mixed organizational culture do not fulfill the discriminant validity. A possible

solution might be the widening of the scale or a conversion of the deliverables by a non-linear variance

de-stabilizing transformation. Supplementary, the number of questions per levers ranges from four ten.

It could improve the prediction power to balance the number of questions in a manner using the

minimum required number in order to ensure validity and reliability. An additional explanation for the

collapse could be that the participants did not fully understand the questionnaires and, therefore,

answered randomly. Notably, for company 3 the translation of the queries may dilute the discrimination

power. Basically, a low item difficulty is the most obvious reason for the bad prediction power, but it

could be foreclosed for the HPO (Brenner, 2012). It is worth to mention that most of the existing

cultural measurement tools, e.g. the ODQ, were not tested for discriminant validity (B. M. Bass &

Avolio, 1993; Parry & Proctor-Thomson, 2001). The collected data offers the possibility to convey

such a study for the ODQ.

Thirdly, the accordance of the experts’ HPO questionnaire answers and the employees’ responses could

not be confirmed significantly. There are no patterns noticeable, weather this disagreement is based on

certain levers, wrong scale setting or not given discriminant validity. It is important to note, that this is

not per se an impairment of the HPO. This result might be biased by a wrong selection of the experts as

well as by the sheer fact that one expert per company might be to less. Furthermore, the not met

methodical test pre-requirements are another source of errors, which might manipulate the test

performance. Although it is not part of the main study I complementarily performed the equivalence

- 43 -

test for the transactional and transformational dimension of the ODQ and received permanent

disagreements for all four companies. This could indicate as well that the test set up is defective.

Besides, the statistical implication differs completely from the mixing console classification. Those

rather signal that company 1 and company 3 possess agreement in contrast to company 2. In this

context it might be interesting to incorporate the findings of this thesis into the item classification (cf.

Appendix 6.3). In particular, the adopted scale is not centered and, therefore, a distortive skewness

prevails. It seems also thinkable to rather utilize an continuous scale instead of an discrete scale for the

mixing console. In this way also the transformation from a four item scale to a five item scale can be

avoided. I believe that the whole item classification is an artificial help to overcome the incurred

deficiencies within the questionnaire scale. This issue could rather be solved in the beginning with a

wider questionnaire range as noted above. Overall the benchmarking process might be readjusted to the

broader data base.

Ultimately, the desirable qualitative validation was briefly executed (Schein, 2009). This approach is

merely a supplement in this work, yet, should be extended to utilize the evaluated date efficiently. The

comparison does not reveal a tendency. It suggests that in general the mixing console reflects the

intended organizational cultural description. I suggest accomplishing in-depth mini case studies for any

of the four companies by practiced experts in this research fields. The methods to tackle those are

already established with the framework of the ten levers (cf. Figure 5). Additionally, the main part of

data collection is already completed. In this vein the described subcultures might be assessed more

precisely and even a comparison with the regarding questionnaire results, i.e. clustered by business

unit, is doable.

In sum, this study does not fully attest construct validity for the HPO.

5.2 Limitations

One of the key decisions to examine the convergence validity was to pool the transactional and

transformational scales of the ODQ into a single figure within one continuum. Definitely, there are

other feasibilities to solve the issue in comparison to the provided approach. For example, I could

instead unfold the HPO continuum into two dimension. However, from my perspective it makes more

sense to map against the HPO scale as the point of interest of this work. Accessorily, the negative

- 44 -

transactional points might not be added to the transactional dimension and vice versa. Indeed, this

would contradict the model, that transactional and transformation cultures are the antithetic poles of the

same scale (Burns, 1978; Heidbrink & Jenewein, 2011). Furthermore, the question about the number of

dimensions is still in discussion and not finally resolved (Avolio et al., 1999; B. M. Bass & Avolio,

1993; Burns, 1978). Besides, the HPO completely ignores the postulated third dimension of

transactional and transformational organizational culture, namely Laissez-faire (B. M. Bass & Avolio,

1993).

Moreover, we have to consider that nearly half of the predication power gets lost through the

accumulation of the strategic levers. With all this manipulations in order to make the HPO and the

ODQ comparable we oversimplify the already truncated organizational culture. Nevertheless, even

with all this limitations the convergence validity is still proven.

A second big issue is the small data sample for expert evaluations. Having solely one expert per

company makes the results very dependent to subjectivity. Especially, the test of accordance is highly

affected by this restraint. The addition of further participants will lead to more robust implications.

Over and above the selection of the expert might be diversified by combining an insider with an

outsider.

Next, we did not take sub-cultures for this study into consideration, yet, there are strong signs that they

exist in the examined companies (cf. Appendix 6.17 - 6.19) as well as they could even be more

powerful than the overall culture (Schein, 1990). For instance if an expert works in a small department

with a different culture than the overall company culture, the expert surely tends to describe his

department culture. Hence, sub-cultures could influence the results of this validity test.

Another not covered topic is the investigation, if the practical approach of the HPO development

touches the holistic theoretical concept of transactional and transformational culture. For example the

last strategic lever should at least describe the full range of leadership (cf. Figure 3). Not only the

broadness, but also the deepness namely the three levels of organizational culture (Schein, 1990)

should be evaluated sufficiently.

Lastly, the data sample might not be representative. Especially for company 2 and company 4 we do

not get an appropriate coverage of the companies’ workforce. Again this could contradict with the

experts’ point of view.

- 45 -

5.3 Final Note

The research team of Jenewein and Heidbrink developed a new tool to have the capability to measure

organizational culture in ten key dimensions based on the theory of transactional and transformational

culture (Heidbrink & Jenewein, 2011). They are aware that in detail neither the deepness nor the

broadness of culture are quantifiable (Heidbrink & Jenewein, 2011). Nevertheless, such a survey

method is helpful to benchmark roughly different companies or industries, to sensibilize employees to

think about this topic and to serve as a starting-point for an in-depth analysis. Though, a quantitative

measurement tool always oversimplifies culture (Schein, 2009), the HPO at least enables the top

management to evaluate ten different topics. The tradeoff between complexity of such a broad and deep

concept as organizational culture on the one hand and the requirement of simplicity represented by a

single KPI on the other hand is balanced quite well with the HPO mixing console.

From my perspective this classification combined with the visual display improves the usability in

comparison to prevailing tools of transactional and transformational culture measurement. Furthermore,

the criticized dichotomy of the ODQ questionnaire (Parry & Proctor-Thomson, 2001) combined with

the lack of an in-depth validation like discriminant validity offer space for improvement. Therefore,

from my point of view the HPO represents the next evolutional step for quantification of organizational

culture in the dimensions of transactional and transformational.

I myself had the chance to assistant during such a workshop of mid management in a huge German

financial advisory company to get in touch with the practical site of cultural assessment. The HPO

accompanied the cultural change process as an accessory tool for measurement. It was successfully

utilized among others to reveal differences between different branches.

Although, there might still be a lot of work to be done to measure organizational culture sufficient

enough, it is worth the effort. Every small step will be leveraged by the enormous power that culture

emerges.

- 46 -

- 47 -

6 APPENDIX

6.1 Organizational Description Questionnaire

At our organization…

True False ? 1. …we negotiate with each other for resources.

True False ? 2. …people go out of their way for the good of the team,

department and/or organization.

True False ? 3. …decisions are often based on precedents.

True False ? 4. …there is continuous search for ways to improve

operations.

True False ? 5. …rules and procedures limit discretionary behavior.

True False ? 6. …mistakes are treated as learning opportunities.

True False ? 7. …you get what you earn - no more, no less.

True False ? 8. …when you are unsure about what to do, you can get a lot

of help from others.

True False ? 9. …there is strong resistance to changing the old ways of

doing things.

True False ? 10. …we trust each other to do what's right.

True False ? 11. …it's hard to find key people when you need them most.

True False ? 12. …we are encouraged to consider tomorrow's possibilities.

True False ? 13. …bypassing channels is not permitted.

True False ? 14. …new ideas are greeted with enthusiasm.

True False ? 15. …one or two mistakes can harm your career.

True False ? 16. …individual initiative is encouraged.

True False ? 17. …decisions often require several levels of authorization

before action can be taken.

True False ? 18. …we strive to be the best in whatever we do.

True False ? 19. …agreements are specified in advance on what each of us

must do to complete the work.

True False ? 20. …stories are shared of the challenges that we have to

overcome.

True False ? 21. …people are hesitant to say what they really think.

True False ? 22. …the unwritten rule is to admit mistakes, learn from them,

and move on.

True False ? 23. …we have to compete with each other to acquire

resources.

True False ? 24. …you advance or achieve depending on your initiative and

ability.

True False ? 25. …deviating from standard operating procedures without

authorization can get you into trouble.

True False ? 26. …we share the common goal of working toward the team,

department and /or organization's success.

True False ? 27. …people often try to avoid responsibility for their actions.

True False ? 28. …we encourage a strong feeling of belonging.

- 48 -

6.2 High-Performance Organization-Analyzer Questionnaire

Dear Participant,

this HPO-Analyzer©

(= High Performance Organization-Analyzer©

) captures a total of 10 factors of

organizational culture, represented in 10 so called strategic levers. In 50 statements we ask for your

assessment if each statement in your opinion is true for your organization. There are no wrong or

right answers. The implementation should take no longer than 10 minutes of your time. We ask you

to read each statement carefully and mark exactly one of these four categories:

Of course, all data is kept strictly confidential and presented anonymously. We ask you only for the

following three/two pieces of information concerning your area of work:

a) Level of hierarchy

o Executive

o Employee

b) Professional experience since completion of education

o Less than 5 years

o 5 to 20 years

o More than 20 years

c) Departement / Location/ application area

o Sales

o HR

o IT

Thank you very much for your honest answers to the questions and your participation in this study!

strongly

disagree

disagree agree strongly

agree

1 2 3 4

1. I know the vision of our organization. � � � � x

- 49 -

HPO-Analyzer©

– Measurement of the ten strategic levers of organizational culture

1. Strategic Lever: Organizational purpose

strongly

disagree

disagree agree strongly

agree

1 2 3 4

1. First of all we go for financial success. � � � �

2. Our company has an inspiring vision. � � � �

3. We often talk about the overall, common purpose of our

activities. � � � �

4. We talk mainly about how to reach our goals, but little about

their purpose. � � � �

5. Our company does not differ significantly from other

companies. � � � �

2. Strategic Lever: Organizational structure

strongly

disagree

disagree agree strongly

agree

1 2 3 4

6. We work without formal job descriptions or fixed guidelines. � � � �

7. We are working in changing teams and projects, not in fixed

working structures. � � � �

8. Our department is led by a central unit, which plans and

controls everything. � � � �

9. In our company hierarchy is not really important. � � � �

3. Strategic Lever: Decision making process

strongly

disagree

disagree agree strongly

agree

1 2 3 4

10. In our organization decisions are made by experts, even if they

are not part of the top management. � � � �

11. Even employees on lower hierarchy levels can make important

decisions. � � � �

12. Only our supervisors can make decisions. � � � �

13. The internal experts are ignored too often. � � � �

14. Decisions are mostly made by employees, who also realize the

task at hand. � � � �

4. Strategic Lever: Organizational dynamics

strongly

disagree

disagree agree strongly

agree

1 2 3 4

15. Necessary changes are often ignored for a long time. � � � �

16. Change is part of our daily business. � � � �

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17. New ideas are tested right away. � � � �

18. For us it is deemed to be good enough when we can hold our

status quo. � � � �

19. Our work environment is changing continuously. � � � �

5. Strategic Lever: Rites & Legends

strongly

disagree

disagree agree strongly

agree

1 2 3 4

20. Our supervisors speak in a demanding tone. � � � �

21. In our company prevails an evaluative style of speech. � � � �

22. We celebrate our successes spontaneously and without

planning. � � � �

23. There are fascinating stories about how our team has coped

with crises and reached outstanding success by working

together. � � � �

6. Strategic Lever: Autonomy at work

strongly

disagree

disagree agree strongly

agree

1 2 3 4

24. Employees have to meet the expectations of the position they

are in – not more, not less. � � � �

25. We have detailed instructions in place, so everybody knows

what to do and when. � � � �

26. In our company, employees can decide for themselves how

they want to contribute to greater good. � � � �

27. Our staff can decide largely independently how they do their

work. � � � �

7. Strategic Lever: Control or Trust

strongly

disagree

disagree agree strongly

agree

1 2 3 4

28. Our principle is: Trust is good, control is better. � � � �

29. There is a high degree of trust in our organization. � � � �

30. The competences of our employees are often doubted (and

respectively often checked). � � � �

31. Employees are encouraged to take action, even at the risk of

committing mistakes. � � � �

8. Strategic Lever: Forms of internal cooperation

strongly

disagree

disagree agree strongly

agree

1 2 3 4

32. In our company, it is important to optimize the results of one´s

own department, even at the expense of other departments. � � � �

33. For us it is necessary to serve the common purpose of the

organization and not only let one´s own subgroup stand in a � � � �

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good light.

34. With us the idea of networking is greatly encouraged. � � � �

35. In our organization, the cooperation between departments

must be arranged explicitly. � � � �

36. Employees of all hierarchical levels can work together without

any problem. � � � �

9. Strategic Lever: Individual or collective interests

strongly

disagree

disagree agree strongly

agree

1 2 3 4

37. We take good care of fairness and social balance. � � � �

38. For us it is okay to follow through one´s own interests

rigorously. � � � �

39. A behavior that hurts the team spirit will not be tolerated by

us. � � � �

40. For us it is common to defer one´s own interests for the good

of the whole. � � � �

10. Strategic Lever: Leadership

strongly

disagree

disagree agree strongly

agree

1 2 3 4

41. In our organization, employees are promoted according to

their respective individual strengths and preferences. � � � �

42. Our leaders place great importance to the development of

skills and capabilities of the employees. � � � �

43. Our leaders control their employees more than they trust

them. � � � �

44. Our leaders also strike new and unusual paths. � � � �

45. It is typical that our leaders encourage us to critical and

independent thinking. � � � �

46. In our organization, the leaders fulfill their exemplary role. � � � �

47. In our organization the relationships between employees and

supervisors are not very trusting. � � � �

48. Our leaders carry out their leadership role with passion. � � � �

49. Our leaders do very well in generating enthusiasm and

confidence and get us going. � � � �

50. Our leaders provide an inspiring vision of the future. � � � �

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6.3 Item Classification of HPO Mixing Console.

6.4 HPO Mixing Console for Company 1

The expert evaluation is marked brightly (red) and the participants’ assessment in dark (blue).

Class Lever 1 Lever 2 Lever 3 Lever 4 Lever 5 Lever 6 Lever 7 Lever 8 Lever 9 Lever 10

TF++ 3.30-5.00 3.50-5.00 3.50-5.00 3.50-5.00 3.50-5.00 3.30-5.00 3.60-5.00 3.90-5.00 3.50-5.00 3.70-5.00

TF+ 3.20-3.29 3.30-3.49 3.40-3.49 3.40-3.49 3.40-3.49 3.10-3.29 3.40-3.59 3.70-3.89 3.40-3.49 3.60-3.69

0 3.00-3.19 3.10-3.29 3.20-3.39 3.20-3.39 3.20-3.39 3.00-3.09 3.20-3.39 3.50-3.69 3.30-3.39 3.40-3.59

TA+ 2.80-2.99 2.90-3.09 3.00-3.19 3.00-3.19 3.00-3-19 2.80-2.99 3.00-3.19 3.30-3.49 3.10-3.29 3.20-3.39

TA++ 1.00-2.79 1.00-2.89 1.00-2.99 1.00-2.99 1.00-2.99 1.00-2.79 1.00-2.99 1.00-3.29 1.00-3.09 1.00-3.19

- 53 -

6.5 HPO Mixing Console for Company 2

The expert’s evaluation is marked brightly (red) and the participants’ assessment in dark (blue).

6.6 HPO Mixing Console for Company 3

The expert’s evaluation is marked brightly (red) and the participants’ assessment in dark (blue).

- 54 -

6.7 HPO Mixing Console for Company 4

The expert’s evaluation is marked brightly (red) and the participants’ assessment in dark (blue).

6.8 Scatter Plot of ODQ Results for Company 1

-14

-13

-12

-11

-10

-9

-8

-7

-6

-5

-4

-3

-2

-1

0

1

2

3

4

5

6

7

8

9

10

11

12

13

14

-14 -13 -12 -11 -10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14

Tra

nsa

ctio

nal

Transformational

Expert Average Individual Answers

- 55 -

6.9 Scatter Plot of ODQ Results for Company 2

6.10 Scatter Plot of ODQ Results for Company 3

-14

-13

-12

-11

-10

-9

-8

-7

-6

-5

-4

-3

-2

-1

0

1

2

3

4

5

6

7

8

9

10

11

12

13

14

-14 -13 -12 -11 -10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14

Tra

nsa

ctio

nal

Transformational

Expert Average Individual Answers

-14

-13

-12

-11

-10

-9

-8

-7

-6

-5

-4

-3

-2

-1

0

1

2

3

4

5

6

7

8

9

10

11

12

13

14

-14 -13 -12 -11 -10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14

Tra

nsa

ctio

nal

Transformational

Expert Average Individual Answers

- 56 -

6.11 Scatter Plot of ODQ Results for Company 4

6.12 Scree Plot for Factor Analysis of Company 1

-14

-13

-12

-11

-10

-9

-8

-7

-6

-5

-4

-3

-2

-1

0

1

2

3

4

5

6

7

8

9

10

11

12

13

14

-14 -13 -12 -11 -10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14

Tra

nsa

ctio

nal

Transformational

Expert Average Individual Answers

- 57 -

6.13 Scree Plot for Factor Analysis of Company 2

6.14 Scree Plot for Factor Analysis of Company 3

- 58 -

6.15 Scree Plot for Factor Analysis of Company 4

6.16 Standardized Weights for HPO Levers

Model Method Lever 1 Lever 2 Lever 3 Lever 4 Lever 5 Lever 6 Lever 7 Lever 8 Lever 9 Lever 10

HPO1 Factor Analysis 0.0998 0.0642 0.1153 0.1095 0.0949 0.0358 0.1105 0.1215 0.1141 0.1343

HPO2 Equal Weights 0.1000 0.1000 0.1000 0.1000 0.1000 0.1000 0.1000 0.1000 0.1000 0.1000

- 59 -

6.17 Qualitative Analysis by Expert for Company 1

- 60 -

- 61 -

- 62 -

- 63 -

6.18 Qualitative Analysis by Expert for Company 2

- 64 -

- 65 -

- 66 -

6.19 Qualitative Analysis by Expert for Company 4

- 67 -

- 68 -

- 69 -

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8 DECLARATION OF AUTHORSHIP