Escalation Of Commitment
A report to the Chief Executive about the dangers of escalation of commitment and measures that organisation can take to curb escalations
Contents
1. Executive summary 1
2. Intoduction 2
3. Causes of escalation of commitment 3
3.1. Psychological 3
3.2. Social 3
3.3. Economic 4
3.4. Organisational 4
4. Dangers of Escalation of Commitment of the Ebola vaccine project 5
4.1. Physiological Dangers 5
4.2. Social Dangers 5
4.3. Economical Dangers 6
4.4. Organisational Dangers 6
5. Measures to deal with Escalation of Commitment: 7
5.1. Share and reduce responsibilities 7
5.2. A good project evaluation and management 7
5.3. Backup Options: 8
6. Conclusion 8
7. Bibliography 8
1. Executive summary
Ebola outbreak in West Africa this year, it is one of the dangerous viruses since the past 40 years from now, over thousands of people have died in West Africa this year (BBC, 2014).1 To develop Ebola vaccine, this project would be a “long haul project” and definitely would face many obstacles. Since the past 40 years, no one can successfully develop medical method to curb this virus.2 One of the obstacles, escalation of commitment, is going to inquiry in this paper.
By examining the case of the Long Island Lighting Company, the company started a project to build a nuclear power plant in Long Island, New York. The management presumed that this project would cost 75 million dollars and would be finished by 1973. However, the project finally completed in 1986 at a cost more than 5 billion dollars because of the resistance of the local citizens, when a negative feedback was found, the decision maker was faced with a dilemma: should she terminate the project and withdraw the remaining resources to invest somewhere else, or should she stick with the initial decision (Hawks, n.d.).3 Why was the management in this case prone to the initial decision even the cost and time cost increased significantly? The answer is escalation of commitment. This case shows that
Contents
1. Executive summary 1
2. Intoduction 2
3. Causes of escalation of commitment 3
3.1. Psychological 3
3.2. Social 3
3.3. Economic 4
3.4. Organisational 4
4. Dangers of Escalation of Commitment of the Ebola vaccine project 5
4.1. Physiological Dangers 5
4.2. Social Dangers 5
4.3. Economical Dangers 6
4.4. Organisational Dangers 6
5. Measures to deal with Escalation of Commitment: 7
5.1. Share and reduce responsibilities 7
5.2. A good project evaluation and management 7
5.3. Backup Options: 8
6. Conclusion 8
7. Bibliography 8
1. Executive summary
Ebola outbreak in West Africa this year, it is one of the dangerous viruses since the past 40 years from now, over thousands of people have died in West Africa this year (BBC, 2014).1 To develop Ebola vaccine, this project would be a “long haul project” and definitely would face many obstacles. Since the past 40 years, no one can successfully develop medical method to curb this virus.2 One of the obstacles, escalation of commitment, is going to inquiry in this paper.
By examining the case of the Long Island Lighting Company, the company started a project to build a nuclear power plant in Long Island, New York. The management presumed that this project would cost 75 million dollars and would be finished by 1973. However, the project finally completed in 1986 at a cost more than 5 billion dollars because of the resistance of the local citizens, when a negative feedback was found, the decision maker was faced with a dilemma: should she terminate the project and withdraw the remaining resources to invest somewhere else, or should she stick with the initial decision (Hawks, n.d.).3 Why was the management in this case prone to the initial decision even the cost and time cost increased significantly? The answer is escalation of commitment. This case shows that
Bibliography: Barber, E, ‘WHO Pillories Drug Industry on Failure to Develop Ebola Vaccine’ Times (4 Nov 2014), from: http://time.com/3555706/who-ebola-vaccine-pharmaceutical-industry-margaret-chan/ accessed 1 November 2014 Bazerman, M BBC (2014), ‘Why Ebola is so dangerous’, from: http://www.bbc.co.uk/news/world-africa-26835233 BBC (n.d.), ‘Vietnam War: History’, from: http://news.bbc.co.uk/1/shared/spl/hi/asia_pac/05/vietnam_war/html/introduction.stm, accessed 4 November 2014 Drummond, H (1996), ‘Case of Escalation in Decision Making’ [Online]. from: http://vital.liv.ac.uk/bbcswebdav/courses/ULMS351, accessed 5 November 2014 Geiger, S., Irwin, S & Robertson (1998), ‘The Impact of Cultural Values on Escalation of Commitment, EBSCO Business Source Premier’ [Online] Staw, B.M. (1976). Knee-deep in the Big Muddy: A study of escalating commitment to a chosen course of action. Organizational Behavior and Human Performance, 16, 27-44. Staw, B.M. (1981). The escalation of commitment to a course of action. Academy of Management Review, 6(4), 577-587. Staw, B. M. & Ross, J. (1989), ‘Understanding behavior in escalation situations. Science’ Volume 246 Whyte, H., (1986), ‘Escalating commitment to a course of action: A reinterpretation.’ Academy of Management Review,