Does disclosure matter? Integrating organizational learning and impression management theories to examine the impact of public disclosure following failures

Vinit M Desai
Strategic Organization, vol. 12 no. 2, May 2014, pp. 85-108

The typically disparate literatures on organizational learning and impression management have both separately sought to examine how organizations respond following failure, with the former asking how organizations learn from these events and the latter investigating how organizations use public disclosures to manage perceptions following these events. This study integrates these perspectives to ask how disclosures might impact learning through failure. The study distinguishes between major and minor failures, asserting that public disclosures exert a distinct influence on learning through either form of experience. Related hypotheses are tested on failures arising within the US air-traffic control system. Although no support is obtained for predictions about major failures, the study finds that facilities can learn through minor failures but the process is impeded by public disclosures, suggesting the notable influence that these disclosures have over audiences’ perceptions of the organization or its role in these events. This approach addresses a longstanding tension regarding why some organizations learn more effectively than others by emphasizing how organizations shape interpretations of their experience.