TOWARDS AN ATTENTION‐BASED VIEW OF THE FIRM

TLDR

Firm behavior results from how decision‑makers allocate attention to issues, which depends on the firm’s rules, resources, and relationships. The study aims to formalize how attention allocation shapes firm behavior and to illustrate its implications for explaining and adapting to firm dynamics. The authors construct a model that maps decision‑maker attention allocation to firm actions, linking rules, resources, and relationships to communication and procedural outcomes. © 1997 John Wiley & Sons, Ltd.

Abstract

The central argument is that firm behavior is the result of how firms channel and distribute the attention of their decision-makers. What decision-makers do depends on what issues and answers they focus their attention on. What issues and answers they focus on depends on the specific situation and on how the firm's rules, resources, and relationships distribute various issues, answers, and decision-makers into specific communications and procedures. The paper develops these theoretical principles into a model of firm behavior and presents its implications for explaining firm behavior and adaptation. ? 1997 by John Wiley & Sons, Ltd.