Abstract This study explores how firms learn heuristics from negative outcomes. Prior literature has suggested that learning is strongly affected by whether attributions for negative outcomes are internal or external. Our data complement this view by revealing a new and different pattern. Specifically, they show that learning heuristics appears more dependent on whether attributions are convergent or divergent across hierarchical levels. Moreover, our data show that formal communication influences the convergence and divergence of those attributions. Besides setting forth an emergent framework for how firms learn heuristics and shedding light on the microfoundations of dynamic capabilities, a central contribution of this article is uncovering important missing components of organizational learning. Copyright © 2012 Strategic Management Society.
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