CREDO - Research in Ethics and Decision-making in Organisations, was founded by Verner C. Petersen in January 1995, but a small group of researchers at the Department of Management at the Aarhus School of Business had been working with same ideas since 1989. The objectives of CREDO were research and development of alternatives to more traditional conceptions of management, leadership and organisation in both private companies and public institutions. It was within this research group that the original ideas on value-based leadership were developed and combined with ideas and theories on self-organisation.

Professor Verner C. Petersen (Photo: Niels Åge Skovbo)

Research themes

1. Contradictions and deformities of regulation and modern management

• The erosion of responsibility as a result of explicit regulation of behaviour
• The origins and workings of ambiguous spirals of moral decay in an organisation
• Deceptive measures, the perverting effect of measurements of human efforts
  

2. Understanding the tacit foundations of knowledge and values

• Tacit knowledge and understanding instead of algorithms and knowledge management
• Arguments for a social grammar as a substitution for written policies and codes of conduct
• The creation of tacit knowledge and the moral fabric of organisations
  

3. Self-organisation and value-based leadership

• Self-organising solutions instead organisational corsetry held up by management
• Spirited and value-based leadership substituting management
• Containment of the logic of the market through responsible entrepreneurship

Original ideas and theories

1. Analyses of problems in current management and regulation, including aspects of modern management theory.

The analyses build on the pioneering work which has already been carried out by CREDO, in which theoretically founded analyses have shown that attempts at detailed regulation and use of modern management tools contribute to causing problems. Problems of less responsibility, commitment and loyalty, but also problems in relation to evaluation of performance and results, among other things by inexpedient measuring of activities, which entail unintended changes in behaviour. This has been shown in a series of CREDO working papers and included in the book "Beyond Rules in Society and Business" (2002 and 2003).

These problems are slowly being recognised both in connection with leadership and organising of companies and more recently In relation to societal management and regulation which among other things is illustrated in the book "Errings of the Welfare State".

2. Tacit knowledge and silent values

In order to develop an alternative to explicit regulation/management and to measuring – both on a societal level and in relation to leadership and organising of the individual company – it is crucial to possess a better understanding of the role which tacit knowledge and silent values play in connection with responsible, insightful and rational behaviour and decision-making in society as well as in companies and organisations. A number of theoretical analyses of these themes have already been carried out by CREDO. We can among other things refer to CREDO working papers, the book "Beyond Rules in Society and Business" (2002 and 2003) and the PhD dissertation "On competency development and action research and competency development through action research". (2003).

To achieve practical applicability of these theories, extensive analyses of concrete subject areas will be required. This applies to knowledge in relation to how new knowledge is created and maintained, the new knowledge which is a prerequisite for e.g. new products and services. The assumption is that new knowledge emerges as a result not of knowledge sharing but of knowledge synthesis, as it has been accounted for in the first theoretical groundbreaking of CREDO. These ideas are further developed in a PhD project entitled "Organisational designs, organisational climate and innovative force".

3. Value-based leadership and self-organisation

The view on leadership which was first outlined in the theories of CREDO include the following elements which are briefly presented in figure 1.

Figure 1: Aspects of management.

Management mechanics

Planning
Organising
Decision making
Control and
Adjustment

The leading part of leadership

Idea, purpose, direction
Spirit which motivates and calls for commitment
and independent efforts from employees
Obligation and mutual trust

Coalescence and self-organising

Self-coordination and self-control on the basis of common goals and values
Insight and responsibility
Synthesising of knowledge and competency

At the top of the figure are the aspects which form part of any management theory. Management perceived as control entails development of explicit systems that target, coordinate and ensure that a defined group of people and specific processes lead the organisation towards a certain specific goal. This can include planning, organisational charts, job descriptions, supervision, control and sanctioning mechanisms.

The leading part of leadership is something other and more than management. As a minimum, it involves the ability to make a defined group of people work together in a consistent manner, and over time towards a common goal, without detailed instructions and without pressure, control and threats of coercion. The task of the management is here to hold on to the idea, contribute to ensure the purpose, and outline the direction without detailed regulation. The management should contribute to ensuring a spirit which motivates and calls for commitment. Meeting mutual obligations and trust are a prerequisite for employees being able to work without specified instructions and control.

By coalescence we mean conglomeration, e.g. the conglomeration which can take place when people get together without it being prearranged, without a plan. This may happen if during a fairly short period of time they react to something which they all separately perceive as a problem. For example when they spontaneously form grassroots groups against a specific environmental issue. Even expressing that there is a problem can bring about conglomeration, and suddenly all react as one. Self-organisation includes the ability when in a group to organise the solving of tasks without detailed externally induced instructions by instead drawing on the insight and responsibility and the knowledge – tacit as well as explicit – which exists within the group. Cooperation and coordination cannot be planned in detail, and only to a minimal extent will the coordination be ensured by a prearranged plan.

Analyses and empirical research into these theories can among other thing be found in CREDO working papers, PhD dissertations, and in the book "Beyond Rules in Society and Business" (2002 and 2003). Later on these theories have also been used for analyses on a more general societal level, for instance in "The Otherworldly View of Economics – and its Consequences" (2005), "The Ship of Fools – a Society of Selfish Individuals" (2006) and in the book "Errings of the Welfare State – Disintegration of Solidarity, Management Illusions, Ways Out" (2008-2009).