How has Sharp Corporation led themselves to crisis: Flexibility in the neighborhood brings rigidity at the core

Manager fs cognitive biases prohibits from changing organization. But, we do not know in-depth and correctly how do they decide things when they persist in something. We distinguish managerial objects into three categories: focus of attention, neighborhood of focus, and out of focus, and we analyze what kind of decision was made for each category. From the case study of the crisis of Sharp Corporation, we found that managers 1) enthusiastically kept investing and running the LCD panel production (focus of attention), 2) flexibly changed the other strategic options of LCD business like target market, choice of vertical domain or alliances (neighborhood of focus), and 3) nearly ignored the other business areas (out of focus). From such consideration, we hypothetically proposed the logic that flexible changes in neighborhood of focus rather enhance the rigidity in focus of attention.