Comparing Aspiration Models: The Role of Selective Attention

abstract For many years, scholars have used a variety of models to measure organizational aspirations, but these alternative measures reflect differing assumptions about the decision‐making processes determining aspiration levels. This study begins by examining some of the implications of the aspiration models in use. It then extends the theoretical model of aspiration levels from the behavioural theory of the firm to incorporate varying attention, another fundamental concept from the theory. Finally, it uses direct aspiration measures on the sales performance of retailers in a large automotive manufacturer to assess the alternative theories by comparing existing models with one that incorporates varying attention. We find support for a model where the importance of the factors influencing aspiration levels varies with the level of past firm performance relative to industry performance. Thus, the varying attention so central to the behavioural theory of the firm influences the formulation of aspirations.