Question: Discuss the main causes of escalation of commitment. What measures can organizations take to protect themselves against becoming caught up in an escalatory spiral?

Expert answer

There are a few key reasons why people and organizations tend to escalate their commitment to a failing course of action. First, it can be difficult to admit that we have made a mistake. Our egos are often invested in our ability to make good decisions, and admitting that we have erred can be painful. Second, we may rationalize our decision by believing that if we just invest a little more effort or resources, the situation will improve. Finally, we may feel committed to the other people who are involved in the project, and not want to let them down by admitting defeat.

Organizations can protect themselves against escalation of commitment by establishing clear guidelines for when to cut their losses and move on. For example, they can set limits on the amount of time and money that can be invested in a failing project. They can also encourage open communication and debate, so that different points of view can be heard and considered. Finally, they can create a culture of learning from mistakes, so that admitting error is seen as a positive step, not a sign of weakness.