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A unified framework for incorporating decision making into explanations of business failure

Joseph Amankwah-Amoah (Associate Professor of Management, School of Economics, Finance and Management, University of Bristol, Bristol, UK)

Industrial Management & Data Systems

ISSN: 0263-5577

Article publication date: 10 August 2015

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Abstract

Purpose

The purpose of this paper is to examine how decision-maker attributes unfold to precipitate organisational failure. The analysis brings to light how key attributes such as information-processing capabilities and human capital decay interact to bring about business decline and exit.

Design/methodology/approach

The study is based on an integrated review and conceptualisation of the literature.

Findings

The study articulates how a set of attributes of decision makers, i.e. human capital obsolescence, powerlessness, meaninglessness and institutional linkages, contributes to organisational failure.

Research limitations/implications

The paper concludes by setting out an array of strategies of learning from others’ failures.

Originality/value

In spite of a growing body of research on organisational failure, scholars have placed overwhelming emphasis on ecological explanations and business failure prediction models. The study moves beyond the ecological explanations to offer a more fine-grained analysis of firm-level factors that precipitate business failure.

Keywords

Citation

Amankwah-Amoah, J. (2015), "A unified framework for incorporating decision making into explanations of business failure", Industrial Management & Data Systems, Vol. 115 No. 7, pp. 1341-1357. https://doi.org/10.1108/IMDS-03-2015-0085

Publisher

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Emerald Group Publishing Limited

Copyright © 2015, Emerald Group Publishing Limited

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