Organization leader ship and social innovation

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Askeland, H. (2017). Values-based leadership: Overview of the historical trajectory (Unpublished translation). From E. Aadland & H. Askeland (Eds.), Verdibevisst ledelse [Values-based leadership]. Oslo: Cappelen Damm.

Values in organization and leadership Evolving perspectives within the frame of Values-based leadership Harald Askeland From the late 1970’s theories of values-based leadership (VBL) evolved as a concept accompanying the turn to leadership (Brown and Treviño 2003, Copeland 2014, Askeland 2017), which gradually replaced terms such as administration and management. Yet, few contributions have addressed the content of and differing conceptualizations of values- based leadership through its historical trajectory within management and leadership literature. This article tracks the theoretical foundations and basic premises behind key contributions of VBL into four different main theoretical perspectives. In doing so, the article present, compare and discuss key contributions. The article identify a broader set of theories and perspectives of the concept compared to prior contributions, and propose further venues of development: VBL need a more distinct integration with theories of management and/or leadership, empirical research of applications through practice- oriented studies, a linkage to the renewed interest in institutional leadership as institutional work and contributions of public values. Values-based leadership, or a marked focus on values and leadership, appeared as an important new approach in the leadership discipline from the late 1970’s (Brown and Treviño 2003). Several contributions frame the perspective focusing on structural theories (Quinn and Rohrbaugh 1983), but the mostly cited contributions relate to individual perspectives such as "The New Leadership Approach" (Bryman 1993) and renewed interest in charismatic leadership (House 1976, House 1996) and transformational leadership (Avolio and Bass 1995). Conceiving leadership as formation of meaning can also be linked to this turn of perspective (Smircich and Morgan 1982). As far as I can find references to the concept, the first articles on values-based leadership were written by, respectively, Robert House (1976), who discussed charismatic values-based leadership, and by James Woods, who mentioned values-based leadership in a study on religious leadership (Wood 1981). Meanwhile, James McGregor Burns, through his study of political leadership, referred to as "transforming leadership," laid the foundation for the later development of transformational leadership (Burns 1978). This period also saw a clear, increasing emphasis on organizational culture, with values at the core of culture (Schein 1985). Nevertheless, existing presentations provide a somewhat simplified picture of the perspectives labeled values-based leadership. Not least, it seems important to explore the traditions’ intellectual roots. Second, there are different contributions and theories identified with values-based leadership. These approaches have distinct and differing or

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overlapping theoretical positions. Thirdly, a distinct Scandinavian approach of values- based leadership (Petersen and Lassen 1997, Brytting and Trollestad 2000, Aadland, Askeland et al. 2006) is left un-noticed together with a political science based interest in public values (Moore 1995, Jørgensen and Vrangbæk 2011), largely utilizing more collective perspectives with a distinct focus on shared values. This generates a lack of clarity in academic research and conceptualization of values-based leadership as a whole, as well as for practical application and implementation. Another aspect is that different approaches arise from different academic paradigms. Ambiguity exist on whether the approach is part of leadership theory, and this article conclude in arguing for the application of concepts of VBL or values in organization and leadership, by clarifying and integrating it with general management and leadership theory. This article address the following questions regarding understanding how values-based leadership theories has emerged and what it has become:

1. What are the underlying paradigms of values-based leadership? 2. How do theories of values-based leadership conceive its content, practice and effect

compared across different approaches?

Fundamentals in Leadership: Basic paradigms Different leadership theories often build on different academic paradigms and often represent one or several basic perspectives on organization and leadership. Such basic positions relates to various positions of philosophy of science (Hollis 2002; Jørgensen et al. 2016; Vanebo 2001). Two key dimensions can illustrate these basic positions, with consequences for studies on and explanations of social action and organization. One is the theory of knowledge, or epistemology, and the other is action theory or ontology (Askeland 2016). The first dimension involves whether different perspectives on social reality is regarded as "objective" reality that can provide certain knowledge or whether reality first becomes "real" through our interpretation and "construction." The first view is referred to as positivism, while the second is most often referred to as subjectivism. Based on this dimension, we can see different theories that relate to the understanding of reality and to rationality. On one hand, based on a positivist approach, many organizational and leadership theories will underpin a type of rationality referred to as “analytical” or “purposeful.” On the other hand, a subjectivist approach leads to a rationality of interpretation that involves evaluation, dialogue and negotiation in decision-making processes. Therefore, some are concerned with ensuring that the organization and its leadership follow clear goals and perform a clear analysis of what promotes effective achievement, while others are concerned about the different interests to safeguard; and, therefore, they interpret, negotiate and renegotiate the goals and premises that determine organizational practices. The second dimension involves action theory: whether organizational and leadership theories and explanatory models should be based on broad structures or on individual

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assessments and the need to understand individual and collective actions. While the first approach is referred to as structure-oriented, the second approach is referred to as actor- oriented.

All models of organizations as coherent entities can be reduced to two basic views: organizations as social systems, sustained by the roles allocated to their participants, and organizations as associations of self-interested parties, sustained by the rewards the participants derive from their association with the organization (Aldrich et al. 1992: 27).

Table 1: Classification of perspectives in organization and leadership theory, with implications for values (Hollis 2002; Kemmis 2011; Vanebo 2001). Theoretical dimension of knowledge Action theory dimension

Positivist Rational/analytical

Subjectivist Interpretive

Structure Collective

System Systems in dependent and strategic adaptation to the environment Leadership understood as social interaction, i.e. ritual, function, system-structured Commonly formulated values based on dialogue and compromise among stakeholders

Institution Organizations characterized by culture, rules and norms in the organizational field Leadership understood as socially structured, shaped by discourse and tradition Organizational values adapted to society’s values and as a framework for the organization's members

Actor Individual

Instrument The organization as a tool for meeting goals: rational agents acting collectively for utility Leadership understood as individual behavior, based on performance, events and effect Owners’ values /Individuals with stable preferences and values

Association Intentional actors with common goals and values and with an interest in the organization's survival Leadership understood as intentional action, shaped by meaning and values. Group of individuals with shared values and intentions

Authors conceptualizing organizations in terms of structural factors often refer to organizations as systems. Here, I understand an organization as an established system that sets the conditions for individual action and where different functions are defined through structuring and role allocation. Others will be concerned that organizations are a collection of individuals who consider it useful to collaborate on task solving around specific goals; in this case, organizations can be referred to as associations. Theories with this starting point are based on the understanding of organizations and their leadership as individuals joining because they consider it beneficial to solve problems together. These different approaches are summarized as they appear in Table 1.

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This way of dividing the discipline of organization and leadership theory assigns different contributions to different key theoretical positions. These positions are important to academic approaches, whereas existing literature has placed little emphasis on these connections. For example, a chosen approach may seem to include both theories that implicitly assume a systems perspective on organizations as well as free choice and action by individuals (and individual organizations). The table shows how the application of these two dimensions can provide the basis for dividing and categorizing four main views on the subject of organizations and leadership, with implications for understanding values and leadership. The division is an attempt to categorize theories used to understand and analyze organizations and leadership and later in the article will form the framework for discussion of different approaches to values-based leadership. Before doing so, however, I present some classic contributions to understanding leadership and their treatment of values and leadership. Historical lines of thought in terms of values and leadership: Contributions by the classics Although the concept of values-based leadership can be traced back to the late 1970s and early 80s, ideas of values and leadership have a significantly longer history in leadership. Max Weber used "value rationality" as a concept (Weber and Jordheim 1999), while leadership discipline pioneer Chester Barnard was concerned with leaders taking on the key role of establishing values in organizations (Barnard 1938). Philip Selznick, who emphasized that leaders «infuse organizations with values» and thereby contribute to institutionalization (Selznick 1957), put forward similar ideas. Before presenting the various approaches representing theories of values-based leadership, it may be useful to recapitulate the core of the classics' contributions. Values and leadership – Chester Barnard and Philip Selznick In many ways, Chester Barnard1, shaped the understanding of value focus and value creation in the normative sense as a key task for leaders. He was an inspiration for both aforementioned traditions: the analytical and rational perspective as well as the interpretative and natural one (Scott 1995). Barnard referred to organizations as both formal and informal and pointed to leaders as both rational actors and moral models. Thus, he laid the foundation for further professional work in an economic/rationally inspired direction, as well as in the theoretical school of institutionalism. Organizations facilitate cooperation among actors who are conscious and purpose-oriented. He was concerned that members joined organizations voluntarily to ensuing interactions serving a common purpose. In this sense, leaders’ tasks were "those of control, management, supervision, administration in formal organizations" (Barnard 1938: 6).

1Furthermore, Barnard is regarded as one of the very first to publish a book on organizational theory. He found little help in classical texts on management (Taylor and Fayol), nor within the broader social sciences literature - at least in terms of organizations. He is considered important for having brought experience into the academic field.

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Leaders had to ensure that an incentive system would help members find a reason to participate in the organization and contribute to satisfying its purpose. At the same time, Barnard was concerned with another matter, namely that members’ connection to organizations rested largely on non-material, informal and almost moral bases. A key aspect for organizations to function was therefore the formation of a collective purpose that is almost morally binding on its members. Out of the critical space, Barnard sees this formation of meaning in organizational life as leaders’ central task:

The distinguishing mark of the executive responsibility is that it requires not merely conformance to a complex code of morals but also the creation of moral codes for others. The most generally recognized aspect of this function is called securing, creating, inspiring of “morale” in an organization. (Barnard 1938:279).

This aspect of Barnard's scientific contributions has been less focused (O'Neill 1992: 200), but is an important platform for understanding managers' values-based, ethical and moral responsibility. For him, the manager's overall position in relation to employees and responsibility involved ensuring that the organization's members maintained an acceptable ethical standard in their work, which represents a key concept of leadership. Managers' responsibilities in this field related, on one hand, to creating value, and, on the other, to interpreting and balancing the different values that exist side-by-side in organizations (O'Neill 1992: 202). It is argued that Barnard strongly emphasized leaders’ function of convincing employees and of tying their emotions, motivation and loyalty into the organization's purpose (Scott 1995: 41f). Thus, he established organizational unity and approach-centered consensus and deemphasized natural and existing conflicts of interest as well as different groupings in organizations. Selznick followed these trails in his understanding of leadership, while others have followed Barnard’s work later on in developing an understanding of organizational culture and opinion formation (Deal and Kennedy 1982; Ouchi 1980; Smircich and Morgan 1982). Selznick greatly influenced early institutional theory of organizations, not least through the formulation of the leadership role in relation to shaping values in organizations. He begins his book briefly formulating his main thesis:

The executive becomes a statesman as he makes the transition from administrative management to institutional leadership (Selznick 1984 [1957]: 4).

Behind this claim lay his view on organizations; Selznick affirmed that, in the strict sense, the term “organization” was linked to a legitimate system of consciously coordinated activities, an instrument that was designed to do a job - and thus interchangeable. On the other hand, institutions were a natural product of social need and impressions - a receptive and adaptable organism. Here again, one sees a fundamentally different view of organizations, as either rational and analytical or natural and interpretative, respectively. Selznick emphasized that organizations comprised people and constituted a vibrant social environment that had to be cared for.

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Institutionalization is understood as a process that depends on the organization, over time, developing a distinctive history, as well as the dynamics that emerge when stakeholders interact to produce results in adaptation to their environment. That something can be seen as an institution is that it has become

Infuse with value beyond the technical requirements the task at hands (Selznick 1984 [1957]:17).

A fundamental failure of leadership occurs when one neglects to work on clarifying an institution’s purpose - the reason for its existence:

In this sense, the leader becomes an advocate for institutionalization, offering a guiding hand to processes that would otherwise occur more haphazardly, more readily subject to the accidents and circumstances of history (...) The institutional manager is however primarily an expert in the promotion and protection of values (Selznick 1984 [1957]:27).

The basic purpose of clarifying purpose and basic values lies in the fact that they can influence attitudes and practices - they provide social integration that far exceeds the capacity of formal coordination and a traditional command structure. Leaders contribute to policy through decisive decisions, which, in contrast to administration (routine decisions), have the potential to characterize the organization's development. Such decisive decisions relate to staff recruitment and training, the establishment of systems for balancing different interests in an organization and cooperation with other organizations. Selznick articulates basic leadership functions as:

• Formulating the institution's mission and role, by setting goals based on internal and external requirements that govern the organization's commitment

• Incorporating purpose into the organization's life, i.e. building it into the social structure

• Defending institutional integrity by maintaining values and a clear organizational identity

• Solving internal conflicts, by contributing to balanced interests among the various units and groups that together form the organization (Selznick 1984 [1957]:62-64).

Both Barnard and Selznick share a clear focus: infusing organizations with certain values is a key leadership task. While Barnard includes this dimension as a constituent element of leadership practice, Selznick believes that it establishes the distinction between administrator and manager. In either case, the implication is clear: The leader is the one who contribute to shaping the organization's values. These particular values are to be linked to general ethical and moral standards, but also to the specific values that give the organization a distinctive character. This important premise underlies much of today's literature and practice in values-based leadership.

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Values-based leadership - Presentation and discussion of various contributions Initially, I argued that there are different academic perspectives in the understanding of values-based leadership and that these are related to theoretical perspectives with different basic assumptions. In this part of the article, the previously presented classification of theoretical traditions will form the starting point for classification in the landscape of different contributions to values-based leadership. In the literature dealing with values-based leadership, I believe there is a distinction among values being understood, values taking root and values relating to leadership that can be linked to the previously mentioned dimensions. Earlier in the article, these two dimensions formed the basis for the development of four dominant approaches within the profession of organizations and leadership. Although different approaches to values-based leadership can relate to these main approaches, they will often also operate at or above the boundary between them. In this context, the dimensions mentioned above, which have formed the basis for the division, must be seen as a continuum between idealized positions rather than as mutually exclusive categories. Instrument: An economically rational perspective and ideas about charisma and transformation In the international, and particularly the Anglo-American, contributions, much literature on values-based leadership seems to be rooted in a rational and individual approach. The various contributions presented here are in debt to a positivist view of science with a rational theory-of-action basis. At the same time, these contributions share a perspective that is rooted in the individual and that emphasizes managers' ability to connect others to organizational goals and ideals. One of the clearest advocates of such an approach is Patrick Lencioni, who applies a narrow and instrumental concept of values. He emphasizes that values must be authentic for application in a company's operational practice, with clear implications for action. This function is safeguarded by what Lencioni calls core values: “deeply ingrained principles that guide all of a company's actions; they serve as its cultural cornerstones" (Lencioni 2002: 6). Thus, he emphasizes the instrumental function of values in an organization. To ensure that values possess the elements required for this purpose, he argues that they should not be based on consensus among employees but rather be developed by senior leadership in cooperation with founders and owners (2002:7f). It is leadership's responsibility to ensure that employees understand, adhere to and live out core values in practice. This should be done by weighing the values into all of the organization's processes, from recruitment to production and evaluation. More common in this approach, and clearly from the mid-1970s, is the formulation of different theories with clear common features: Charismatic leadership, visionary leadership

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and transformational leadership (Bryman 1993). These theories have important common features linked to how leaders achieve exceptional results and how they achieve high employee motivation and identification with the manager and organization's goals and values. What links these versions of values-based leadership to this main approach is the focus on the individual as an actor in combination with focus on shared values. At the same time, the content very much maintain a rationality building on a positivist and analytical basis. Robert J. House is credited for introducing a new focus in charismatic leadership theory (House 1976), also referred to as "values-based leadership," (Brown and Treviño 2003; Busch 2012). In several works, he has presented and developed leadership theories that have values and values-based leadership behavior as a key element. His early contributions were particularly oriented towards charismatic leadership that moves and motivates employees and towards leaders’ ability to influence others by promoting ideas and values that challenge the established order (House 1976:7). It is believed that charismatic leaders are effective because they, among other things, articulate or model ideological values that employees hold or identify with. Eventually leaders are able to frame the organization's goals and tasks in a context of meaning that indirectly relates to such values. This context is formulated as follows: "A necessary condition for a leader to have charismatic effect is that the role of followers be defined in ideological terms that appeal to the follower" (House 1976:28). Characteristics of leaders perceived as charismatic are as follows: Dominance, self-esteem, the need to influence others and a belief in one’s own values. A later revision of the theory (House 1996) included values-based leadership behavior as one of eight leadership behavior categories2. Values-based leadership behavior is expressed in this way:

Theoretically such effects are accomplished by appealing to subordinates’ cherished values and nonconscious motives and by engaging their self-perceived identities, enhancing their self-efficacy and sense of consistency, and making their self-worth contingent on their contribution to the leaders’ mission and the collective. (…) Value based leader behaviors include: • Articulation of a vision of a better future for followers, to which the followers

are claimed to have a moral right • Display of passion for the vision, and significant self-sacrifice in the interest of

the vision and the collective • Demonstration of self-confidence, confidence in the attainment of the vision,

and determination and persistence in the interest of the vision • Selectively arousal of the nonconscious motives of followers that are of special

relevance to the attainment of the vision • Taking extraordinary personal and organizational risks in the interest of the

vision and the collective

2 Other leadership behavior categories include: Goal clarification, goal-orientation, work organization, supportive leadership behavior, organization of interaction, group-oriented decision-making, representation and networking.

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• Communication of high performance expectations of followers and confidence in their ability to contribute to the collective effort

• The use of symbolic behaviors that emphasize the values inherent in the collective vision

• Frequent positive evaluations of followers and the collective (House 1996:343). House also emphasizes that values-based leadership must be based on leaders' contributions to articulating moral or ideological goals for the organization or on help interpreting work done in a wider context of ideological implications. Thus, it is also assumed that values-based leadership must agree with employees’ internalized values. As a form of leadership, values-based leadership is also closely linked to employees’ internal motivation, when leaders mobilize around intangible values. Many who could be categorized as theorists of transformational leadership clearly draw from Burns’ study of political leadership (Burns 1978). Burns based his theory on material and insights from political and religious leadership, arguing for a view of leadership that involves leaders and co-workers lifting each other up to a higher level of morale and motivation. His contribution were later applied to various types of business activity (Avolio and Bass 1995; Bass 1990; Conger and Kanungo 1987; Posner 1987), an application that cannot be regarded as unproblematic (Brown and Treviño 2003:155). A key element of this tradition is the definition of leadership largely by the manager and the manager's ability to generate results, mobilize employee preparedness and increase employees' motivation to work (Aditya 1997: 439). Some argue that transformational leadership is characterized by four key aspects, where a leader: • Has charisma and act as a model • Motivates others by inspiring them • Asks questions about the state of things and encourages new thinking • Shows concern for the individual's particular needs (Hetland 2004:96). What makes transformational leadership especially interesting in this context is the connection made to values. A basic premise in the theoretical contribution is that individuals are not only rational actors, but they also seek motives for expressing themselves. The special role of leaders is assumed to consist of:

Charismatic leaders link organizational goals and missions to their followers´ self- concepts. An important aspect of followers´ sense of self is based on a sense of virtue and moral worth. Charismatic leaders infuse work with values and purpose, giving it meaning that instrumental or transactional leaders do not. Charismatic leaders emphasize a collective identity and make inspirational ideological appeals that tap into followers´ values (Brown & Trevino 2003:159f).

Brown and Treviño raise critical questions about whether it is possible to establish such a foundation of moral values in business and claims that there is no documented transfer of these kinds of values from manager to employee in businesses. Others also point out this lack of documentation:

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For example, the neo-charismatic theories offer inadequate or untested explanations of the process, by which the theoretical leader behaviors are linked to, and influence, the affective state of followers (Aditya et al 1997:442).

The approaches that have been mentioned in this context are based on key ideas from the discipline’s classics regarding leadership personalities and the ability of a values-focus to bring meaning into organizational practice. Several studies document the link between leaders perceived to be charismatic and values-oriented and organizational efficiency and employee motivation. At the same time, it is unclear how values and actions relate to one another and which processes unfold in interaction between managers and employees and contribute to consensus on values and value-oriented practices. Association and community The second perspective highlighted here is an approach that, in different ways, focuses on the importance of nonmaterial values for the organization and leadership. Common to the theories presented here is the assumption that basic values, either individual or collective, help shape assessments and actions - and that this concerns leadership. The differences mainly follow the dividing lines linked to the leader’s "management of meaning" (Smircich and Morgan 1982) or how shared values and meaning are created. The perspectives presented here are applied in different ways. After Selznick, many of the ideas seem to remain inactive until the 80s. Some attribute this renewed interest to the introduction of Japanism and to the focus on values and culture as a Western academic response (Ouchi 1980; Schein 1985). At the same time, other contributions can be traced, not least in connection with research on religious and non-profit organizations in civil society. The contributions highlighted here build on traditions that can be linked to Weber, Barnard and Selznick. The group of works presented are divided into two even though they have a common focus on culture, values and leadership. One of the first to use the term "values-based leadership" was James Wood in a study of leadership in American religious congregations (Wood 1981). The context was challenges associated with whether religious assemblies should be ethnically mixed. He demonstrates how pastors and religious leaders contributed to change individual attitudes of opposition to ethnically mixed churches by focusing on fundamental values in the Christian tradition. With values-based leadership, he argues for the possibility of generating support around "" and thereby helping the organization's members to place less emphasis on their own the common good self-interest. The requirement for leaders in such a context will naturally be that they actually articulate the organization’s core values with which the members also agree. Leadership is thus about articulating and showing how common values can shed new light on a situation and lead to alternative courses of action. Weber also discussed the importance of religious values in his study of how the Protestant ethic laid the foundation for a set of actions that laid the foundation for the emergence of capitalism. An example from Norway are Hans Nielsen Hauge’s combination of preaching

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and business ventures (Fløistad 2007). In addition, within other religious traditions, there is an indication of the possibility that religious values can form the basis of leadership. This has happened in both an Islamic tradition (Ryan 2000) and a Hindu tradition (Krishnan 2002). Over a decade, contributions on values and values-based leadership has appeared in a Scandinavian context. One of those most often credited with introducing the concept in a Scandinavian context is Verner C. Petersen (1997)3. Approaches linked to this tradition stand out by not basing themselves on the leader as a charismatic person, as in the literature by Burns, House and Bass. On the contrary, it was deemed crucial for values to be shared in the organization and become part of it and for managers' contributions to involve contributing to a common articulation and understanding of the values’ content and consequences. A major concern has been how values can be made into leadership tools for organizational practices based on self-management, partly to supplement and partly to substitute regulations and objectives-based leadership (Petersen and Lassen 1997; Thyssen 2007):

Leadership involves more. It involves the ability to have a limited group of people working together, consistently and over time towards common goals, without pressure or the ecstasy of power. It is also about values-based management/leadership. In this context, leadership comprises the common values for the entire organization. This basis of values highlights attitudes and values that the business has chosen to represent (Petersen and Lassen 1997)4.

Petersen's contribution to understanding values-based leadership is summarized in a few simple points that emphasize judgment and understanding over clear goals and governance. Leading requires the following: • One should lead guided by a purpose that is often difficult to explain. • One must trust that employees can both organize and commit themselves to work

towards common goals and values. • One must lead ambiguously, leaving room for independence and creativity. • One must lead with consistency and direction. • As a leader, one must be willing to lead. Swedish researchers Tomas Brytting and Claes Trollestad also advocate an approach in which communicative rationality and leaders should first and foremost be seen as observers and interpreters of values that are prevalent in the organizational culture (Brytting and Trollestad 2000: 74). In this way, they seek to counter empirical findings, where leaders perceive that the environment constitutes an economic rationality they cannot avoid, where the organization and individual must adapt to this value and where leaders should primarily formulate values with which the employees can identify.

3 Among other things, several Danish papers that have recently summed up the status of values-based management have done this. 4 The authors translation

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In a Norwegian context, several studies conducted emphasize the importance of values in business management and leadership, especially in the public and non-profit sectors. In 2006, a study of values-based leadership in eight different not-for-profit organizations was published, describing VBL in the following way:

This understanding of leadership is based on the fact that clarification and awareness of values in an organization is a key asset for business leadership. Whereas VBL was previously guided by rules and instructions and later by the clarification and pursuit of objectives, it now looks to a broader business foundation – one embodied in vision and values. (...) Values describe the basic focus one wants a business to have, and this focus serves as a guideline for individual employees in choices made and priorities set on a daily basis. (...) VBL is not just a leadership philosophy but also an organizational development model that accompanies a business’s basic intention (value platform). Through various measures and processes, one ensures that a high degree of awareness of core values is maintained throughout the organization (Aadland et al. 2006: 27).

Values-based leadership is viewed as an approach to leadership, where one does not operate on the basis of a standardized understanding of what this implies or how it should be practiced. Meanwhile, within this approach, different proposals have been made about how to work on clarifying and implementing values in businesses (Aadland 2004). However, also within this approach, leaders become key players in the value process. Among other things, through the fact that they hold a position that allows them to take initiative and prioritize value consciousness. A leader's personality and practices also seem to be crucial to the credibility and scope of values work (Aadland et al. 2006: 70). The HSH study also found that a values orientation from a company’s founding, usually by one of the founders, often plays an important role in how the organization understands itself and its purpose. For many organizations, especially within civil society, this purpose could be associated with purposes based on religious ideals or humanistic ideology. The study found that an ideological basis were activated in all cases, but significantly more clearly formulated as the basis for leadership in organizations with a generally humanistic ideological basis (Aadland et al. 2006: 86). The approaches to values-based leadership outlined here stand out as they are less connected to general management and leadership theories. For example, while House (1996) builds a comprehensive management theory that puts values-based leadership behavior at the core, this perspective is absent in Scandinavian contributions. An exception in this regard is a recent contribution (Busch 2012) linking values-based leadership to an already established process theory of leadership (Johnsen 1992). On the other hand, Scandinavian contributions are considerably more concerned with process and implementation work, especially employee participation. Institution: Values, organization and leadership Values and leadership have a central place in contributions linked to institutional theory. This basic task is associated with theories that focus institutional leadership (Selznick 1957), and can be linked to the following basic features: 1) clarifying the organization's

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mission and goals; 2) realizing this purpose in the organization's life and endeavors; and 3) helping the organization and its members formulate and maintain basic values in the context. Again, this perspective is often used in relation to nonprofit, religious and political institutions (Carroll 2011; Jørgensen 2006; Talleraas and Haga 2012). According to this perspective, the leader becomes an agent for institutionalization, who helps set goals and permeate the organization with values. Thus, the leader plays an important role in institutionalizing values and shaping the organization’s character, so that members identify themselves with the organization and remain faithful to its tasks and goals (Eriksen 1999: 137). The leader's role is seen as proactive, in part because of its contribution to shaping specific values and in part because of the leader’s articulation and interpretation of basic value positions in given situations - whether they are known or new (O'Neill 1992). This function becomes particularly critical when the organization faces new or unknown challenges. The importance of institutionalization lies in the way which it forms the framework in relation to which the organization, environments and courses of action are assessed. Eriksen has focused on leaders who motivate subordinates to pursue goals for purely material reasons, i.e. mobilization through language tools. A clearer focus on values in the public sector has also emerged in recent years, often under the name "public values"" (Moore 1995). Moore linked public values to the provision of relevant services, to the realization of social goals and to the preservation of trust and legitimacy in the public sector. A field in which this approach differs somewhat from the one mentioned above is that it more strongly emphasizes that value-consciousness also deals with conflict among values and the management of values dilemmas. Key values in the public sector, often referred to as "public ethos," link to societal accountability, public disclosure and transparency, good and proper case management and independent professional standards (Jørgensen and Vrangbæk 2011). Studies have investigated which value orientations public sector leaders have, with potential implications for their assessments and decisions. There seems to be agreement among government leaders across countries and political cultures that leadership should ensure integrity through independent, professional public administration (Jørgensen and Vrangbæk 2013: 120). A recent Norwegian study showed that values such as professional standards, the adaptation of services to residents, good case management and loyalty to policy decisions were seen as the most important (Wennes and Busch 2012). At the same time, this study shows that public values are reported to be changing, since values such as user orientation, innovation, professional standards and loyalty to policy decisions have gained ground. Values losing ground are reported to be equal treatment, employee career prospects, continuity and accountability to society. The "institutional work framework" is an approach that contributes to a renewed relationship between values and leadership in the framework of an institutional perspective (Lawrence et al. 2009). This approach is be seen as a reaction to the new institutional perspective having theorized about organizational change and equal treatment without sufficiently incorporating actors and intentional action. Institutional work is defined as "the purposive action of individuals and organizations aimed at creating, maintaining and

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disrupting institutions"" (Lawrence and Suddaby 2006: 215). An important factor is also the connection to practice theory, emphasizing intentional action by individuals and organizations seeking to handle the premises and demands of daily work. In this context, I would like to emphasize in particular how they describe the core elements of efforts to maintain institutions: Table 2: Different types of institutional maintenance work (Lawrence & Suddaby 2006) Type of institutional work Definition Facilitating work Creating rules that promote, complement

and support the institution: Authorization of actors and allocation of resources

Monitoring Ensuring compliance through the management, evaluation and monitoring of results

Creating/preventing Establishing barriers to institutional change

Valourizing Ensuring that actors can participate in positive and negative examples that illustrate the normative basis

Mythologization Maintaining the normative assumptions by creating and maintaining myths about institutional history

Inventing and routinizing Actively infusing the normative basis in actors' daily work, routines and practices

Valourizing-work can be classified as the type of institutional work that is referred to as appreciative, "valourizing." Various contributions can be categorized as belonging to this new approach in the field of institutional theory; contributions that focus on the value of work and analyze how values manifest themselves and evolve within organizations (Gehman et al. 2013), as well as contributions that illustrate how leaders, together with relevant actors, contribute to value creation in organizations (Askeland 2014). Both of these examples can be classified under institutional work and share a practice perspective on leadership and values work. An analysis of several contributions points to the fact that values work is done both in different phases and by measures (activities) at different levels. Central phases could be the initiation and articulation of value issues, participation by actors and groups, the concretization and manifestation of values practices, and the maintenance of values bases and practices. At the same time, different activities and initiatives could be related to different levels, such as: Frames and events ("set-ups"), an information plan that indirectly controls organizational activities through interaction and relationships among actors and on a more concrete action plan. Askeland seeks to integrate leaders’ contribution to values work with the function of leadership, through an integrated model (Askeland 2015). The model first synthesizes contributions by Mintzberg and Quinn and then describes four basic functions and role profiles that leaders fulfill: Director, Service Developer, Integrator and Intermediary. This

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division appears when two core dimensions are applied: task versus relationship orientation and internal versus external focus. Second, Selznick's contribution to institutional leadership is integrated, using the institutional leader as a force for integration, focusing on the whole and on outcomes, as well as on values and meaning formation. System and diversity of stakeholders A basic idea in systems theory is to provide a holistic view of the organization. At the same time, it is emphasized that organizations as systems are part of a strategic and dependent adaptation to external environments; while internally there can be different subsystems with different degrees of coordination. Robert Quinn (1984), who early on developed the idea of competing values, has provided a system-oriented contribution: Competing Values Framework (Quinn 1984; Quinn and Rohrbaugh 1983) in four value orientations. These are, respectively, an Employee Orientation, Structure and System Orientation, Change and Future Orientation and Market Orientation. In a Norwegian context, this approach has been utilized in a large study of values in large companies (Falkenberg 2006), and partly in case studies of Norwegian municipalities (Bjølverud 2014; Engesveen 2014; Wennes and Busch 2012). Based on the model of Quinn and colleagus, it is argued that organizations and leaders have a tool for mapping internal culture and clarifying key values, as well as guidance for choosing a leadership strategy and approach:

The Competing Values Framework helps guide leaders in identifying which elements within the organization (…) can be emphasized, and to what degree they should be emphasized as value creation strategies are formulated and implemented. It is also important to keep in mind that not only must internal dynamics in each quadrant be considered, but the congruence between organizational factors and desired outcomes must also be aligned (Cameron et al. 2006: 16).

An alternative approach to values-based leadership, ethical accounting, also assumes that priorities must be set in a context where different norms and interests are represented in organizations. Ethics and leadership have many intellectual roots, and there is not enough room here to go into the field in depth. Therefore, I only address the roots of ethical accounting, which is an important Danish contribution to values-based leadership. Ethical accounting was developed as an approach in the late 80s (Pruzan and Thyssen 1990). When this contribution is included in the review of understanding the system approach, it involves how Pruzan and Thyssen justify their commitment to ethical accounting with a different purpose than business ethics:

Our aim is different. We intend to consider the use of ethics in the context of an organization as a shared value horizon and planning tool (Pruzan and Thyssen 1990: 141).

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Their starting point is that, in a pluralist society, it no longer seems possible to establish a common understanding of what is right and wrong, i.e. a common moral and ethical theory. Different groupings in societies and organizations will be able to assert different value positions according to the same principle. Their solution lies in developing ethical thinking with two characteristics: 1) rational in the sense that one may argue a position in dialogue, and 2) formalistic in that it requires a certain interaction among groupings. The interaction must be based on equal rights, where one group can claim rights that are equal to rights that can be assigned to other groups (Pruzan and Thyssen 1990: 136). In a study of Swedish business leaders, Brytting and Trollestad indicate that leaders’ relationship to values and leadership is ambivalent (Brytting and Trollestad 2000). They identify a widespread view where the demands of the environment (including economic ones) are considered to be inevitable and where leadership must therefore apply a rational and top-down approach in formulating and implementing values. A recent Norwegian contribution by Rudi Kirkhaug, assigned in this category because it represent as a collective, comprehensive and top-down leadership concept (Kirkhaug 2013). He sums up his view of values-based leadership like this:

We can therefore define values-based leadership as a collective and top-down tool for influencing employee attitudes, behaviors and aspirations to reach the organization's goals and purposes by enhancing, changing or teaching existing values, designing new values, disseminating values throughout the organization and maintaining values, through conscious behavior by leadership (Kirkhaug 2013: 104).

The collective dimension is emphasized, among other things, because the concept levels leaders and employees socially. According to Kirkhaug, values-based leadership assumes the expectation of shared values and commitment to realizing the organization's core values in terms of what is right and wrong. Furthermore, there is a mutual trust between managers and employees. Kirkhaug’s values-based leadership is positioned quite close to instrumental theories, with regard to values being understood as tools for realizing intended conditions and goals. His contribution, therefore, links values to critical functions in organizations, such as task solving and the existence of a power base to make the values applicable in practical organizational action. At the same time, with his emphasis on community and relationships of trust between managers and employees, he will position himself near associations and a shared basis of values as mutually binding. Current perspectives and the development of an integral model Internationally recognized theories of values-based leadership are integrated into overall leadership theories, while Scandinavian contributions have not equally prioritized the links

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between general managerial and/or leadership functions, leadership behavior and values- based leadership. International contributions demonstrate concrete relationships among charismatic values- based leaders and efficiency, employee satisfaction, etc. However, they have not helped to illuminate the process where values are made effective by managers and organizations’ practices. The Scandinavian approach has been much more concerned with the actual implementation part of VBL and has contributed to studies and evaluations of this kind of process. Similarly, recent contributions in institutional work, including values work, have offered a deeper understanding of values work as organizational processes and practices. Several of the contributions mentioned above, especially those of Barnard, Selznick, Smircich and Morgan, underscore that values creation or meaning formation is a as a process. Whether this is referred to as "morale," values or meaning, it seems to involve deliberate and long-term work by leaders. In understanding values, it will also be a key insight that it is difficult to establish a direct connection between values and action. Instead, they are effective through articulation and conversation, in a reflective process related to specific situations where values are activated and at stake. Values, in my view, cannot be fully controlled, but both managers and employees can interpret and exercise discretion in matters affecting values. In conclusion, I will present an attempt to summarize key dimensions in different approaches to values-based leadership. This distribution of contributions will not be wholly precise, but it presents an assessment of how they are fundamentally rooted in basic dimensions that construct the model (see Table 1). Even with this academic foundation, many of the contributions try to "cross" boundaries between dimensions. For example, this is the case with several international contributions that are assigned to an instrumental tradition and then perhaps especially with charismatic values-based leadership (House 1996) and transformational leadership (Avolio and Bass 1995). Rooted in leadership's contribution to values creation, through a clear rationalist approach in terms of both theory and methodology, this primary anchoring seems clear. At the same time, the theoretical seeks to point out that leaders must associate themselves with employees’ values in their approach. Thus, they seek to "cross" the boundaries of the association and social community that exists in any organization. Aadland and colleagues (2006), who use a theoretical and analytical basis in system theory, can apply similar reasoning to contributions. These contributions also draw on the association perspective, not least through the emphasis on employee contributions and participation in the development and concretization of the organization’s values.

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Table 3: Central dimensions in different approaches to values-based leadership and values work Core traditions Dimensions Instruments Association System Institution Values Stable

individual values

Individuals with shared values

Values arise through dialog among different stakeholders

Organizational values adapted to social values and to frameworks for the individual

Anchoring Individually Individually Collectively Collectively Leader’s role

The leader defines values and convinces

Common values are the framework for leaders' articulation and interpretation

Leaders facilitate dialog and negotiation on common values

Leaders contribute to creating values

Work form Control and persuasion

Process and interpretation

Dialog and negotiation

Communication and values work

Contributors House (1978, 1996) Lencioni (2002) Bass & Avolio

Wood (1981, 1984) Petersen & Lassen (1997)

Quinn & Rohrbaugh (1983) Pruzan & Thyssen 1990 Aadland et al. (2006)

Selznick (1997) Jørgensen (2006) Lawrence & Suddaby (2006) Gehman et al. (2013) Askeland (2015)

A key challenge for the further development of the Scandinavian approach, is to make a clearer contribution to analyses and models of how this relates to leadership or to the integration of leadership into management and managerial work, as well as to how managers contribute to balancing different values and managing conflicts among them. One model attempts this kind of integration, where management and institutional leadership is analytically distinct but held together (Askeland 2015, 2016). The institutional side of leadership emphasizes the overriding responsibility for performance and results in the organization and understands leadership as creating meaning and articulating goals, where one will be able to promote values in general as well as the institution's particular values tradition. Leaders thus contribute to conscious attempts to create meaningful contexts and a justification for the business’s purpose and represent an example of values-conscious leadership.

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Figure 1: Integrated model for management and institutional leadership in practice

The director combines classic management tasks, such as initiating structure, developing procedures and safeguarding them, as well as coordinating and planning the work process. The aim of this is to help the business achieve its goals in an efficient and qualitatively good way. The service developer emphasizes an external orientation. This role involves focusing on how tasks are performed, as well as on strategic development or the customization of goals and services through monitoring and adaptation to the environment. The integrator’s function is internal and relational in its orientation, focusing on aspects of the management work that help unite the organization as a functioning social system. The mediator is externally oriented with a focus on building, maintaining and further developing external relations. Here, instrumental and efficiency-oriented elements are de- emphasized in favor of the business’s pursuit of legitimacy and needs in its environment. This role involves effort to establish alliances, but also to act as a "buffer" in relation to external pressures on the organization5. Finally, I would like to argue that it would be of academic interest developing value-work as a perspective, by this approach contributing to the topic and to research on micro- processes that underlie the development and practice of values. Thus, the perspective contributes to the understanding of how institutional values and practices that are taken for granted are established, maintained and changed. Understanding values work as processes emphasizes that phasing in action can be decisive for the outcome. That is, the course of events, detailed in the initiative, agenda setting, participation and organization, can have a major impact on the results. In this regard, time and order will be key factors. It has been argued that values work must be seen as a process in which the whole organization

5 For a detailed presentation of the model and its empirical basis, refer to previous work (Askeland 2016, Askeland 2015).

Task

Director

Mediator Integrator

Service developer

External Internal

Relationship

Institutional leader Comprehensive

response to operations and results

Managing meaning and promoting values

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