Attention and software

RELease 1.0, March 26, 1992 by Michael Goldhaber

It's a little like professional baseball: Players become stars by doing Just what everybody thinks they should to make their team a success. Yet boasting a star or many stars doesn't guarantee that a team will win the pennant - or even make money.

Just as baseball stars are evaluated by umpires' and the media, most corporate stars are judged by outsiders such as investors, customers, analysts and competitors - all givers and receivers of attention. The would-be corporate stars also promote the very ideas on which they will be judged; they can create new categories of performance and make them into industry standards if they are successful.

  The same decade of the Eighties that saw pcs sweep into offices
      also saw a doubling in conferences in semi-public places such
      as hotels or convention centers; teleconferences, previously
      rare, proliferated, along with fax and cellular phones  - ways
      to transmit and receive attention more broadly and frequently.
      It saw a vast increase in "luxury" hotels, in business travel,
      in desirable office space in striking post-modern buildings.
      All these are media for attention-getting by a vast array of
      would-be stars.

Profits are no longer the major measure of corporate standing. Typically the people who control a corporation are not the owners, but rather the managers and players on the corporate stage (although they may own some stock). They bask in the attention they receive rather than the profits the company earns. (They can also use this attention to justify their salaries, of course.) What does Lee Iacocca really want: Profits for Chrysler, or airtime for himself? What does Bill Gates really want: Profits for stockholders, or attention/power for a company that he identifies with?

Even financial valuations are smudged by the economics of attention: What gives a company a high p/e ratio? The attention of analysts, of course.

Stars do well in corporations

A successful corporate star, like any other star, is successful because he or she generates attention from the audience in question - in this case within a company or within its market. An employee who obviously showboats or lies would be discounted. Clearly, some corporations operate with more sophisticated and astute audiences (including their own top executives) than others. But as the S&L and junk bond debacles suggest, its easy to overestimate such astuteness; the high officials and many of the commentators on them are stars in their own right, and they create that image by generating high profits or the expectation of high profits for just long enough.

As the corporate world becomes more of an attention economy, innovative behavior earns a premium. One does not get that much attention by proceeding, however well, on a steady, unchanging course from year to year. Indeed, the attention economy is self-propelling, even within companies supposedly dedicated to the pursuit not of attention but of profits.

Some old-line companies may resist, of course; to avoid such subversive goings-on, they would have to limit sharply the degree to which their employees could communicate with each other and with the outside world, restricting all the forms of communication mentioned above - and more. Alternatively they would have to control internal behavior with an iron hand, limiting innovation and losing their stars. That approach made sense in the heyday of large-scale mass production of limited sets of goods, but the world today is too swamped with goods of that kind for a corporation to remain viable for long if it sticks to such a model. In general, rigid companies are worse off than the former USSR was because the country could prevent its talented people from leaving, while a company cannot.