Insight into escalation-of-commitment and
de-escalation-of-commitment: A systematic literature review
Hailiang Zeng (S2639882)
University of Groningen
Faculty of Economics and Business
MSc BA-Change Management
January 2016
Supervisor: dr. J.F.J. Vos
Second Assessor: dr. M.A.G. van Offenbeek Word account: 10.722
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Abstract
The extant literature on the escalation and de-escalation of commitment have reached, to some extent, academic maturity. Various explanations for how and why projects escalate or de-escalate are provided by researchers. However, little effort has been made to systematically review escalation and de-escalation behavior together. Using a systematic literature review through the approach-avoidance perspective, this study presents a comprehensive overview of current knowledge on both escalation and de-escalation behavior. There are four selection criteria which result in 51 included studies of which a total of 42 findings are extracted from. These findings are categorized by the taxonomy model by Staw and Ross (1987a). Drawing on the findings, this study suggests that, by bridging the studies of both sides, escalation and de-escalation behavior are interrelated from the approach-avoidance perspective. There is a considerable amount of escalation or de-escalation motivating factors involving in the approach-avoidance conflicts. These factors are interrelated because of the existent common elements among them. This study further suggests that besides common elements among these interrelated triggering factors, the alternative situation is also found. The alternative situation shows the contingency feature of escalation and de-escalation behavior. With the suggestions are discussed, this study offers advice to managers and guidance for future research directions.
Key words: Escalation of commitment, De-escalation of commitment, Project
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Introduction
Despite the increasing awareness and understanding of investments of commitment during change projects, there is considerable evidence that 70 percent of all change initiatives fail (Burnes & Jackson, 2011). For instance, the Standish Group (2009) maintains that many projects’ implementations are problematic. Balogun and Hope Hailey (2004) also report that failure rate in change initiatives occupies 70 percent of all projects. McKinsey & Company (2008) find that two-thirds of all change initiatives failed. Although it can be observed that the success rate of change projects is not satisfying, scholars still find that decision makers maintain investments of commitment to the failing course of action (e.g. Brockner, 1992; Staw, 1997). The question of whether decision makers should continue or terminate, that is, to escalate or de-escalate commitment during a change project has intrigued interests of scholars and has become increasingly crucial for decision makers to avoid further loss or to achieve final success (Keil, 1995; Newman & Sabherwal, 1996; Drummond, 2014).
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suggests that the escalation-of-commitment is a complex phenomenon impacted by various factors (Bragger et al., 2003; Pan et al., 2006a; Sleesman et al., 2012; Drummond, 2014). These factors are categorized as project, psychological, social and organizational factors (Staw & Ross, 1987a; Newman & Sabherwal, 1996).
The behavior pattern of escalation-of-commitment drawn from prior studies is criticized as “throwing good money after bad” (Bowen, 1987, p. 52; Garland, 1990, p. 728; Sleesman et al., 2012, p. 541). To alleviate the impact of the escalation behavior, scholars turn to focus on the de-escalation-of-commitment to failing projects (Pan et al., 2006a). Keil and Robey (1999) identify de-escalation-of-commitment as the termination or redirection of investments of commitment to failing projects through breaking the escalation behavior cycle. Scholars have identified some triggering factors to the de-escalation behavior, such as awareness of unambiguously negative feedback (Garland et al., 1990; Bragger et al., 2003), changes in top or project management (Ross & Staw, 1993), availability of alternative investment (McCain, 1986), implementation of early warning system (Keil et al., 2000) and perceived decision risk (Schaubroeck & Davis, 1994). Pan et al. (2006a) imply that detected failing course of actions must be eliminated as soon as possible to prevent the organization from further loss.
Despite the wide variety of studies toward both escalation and de-escalation behavior, the perspectives of them tend to be singular, either focused at the escalation-of-commitment or focused at de-escalation-of-commitment. The singular perspective, to some extent, constrains the understanding of these two concepts because the de-escalation-of-commitment is the result of criticism of the wrongly escalation behavior. By building a bridge between these two concepts, a clearer overview of the commitment investment can be constructed.
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an analogy: starting and quitting smoking, indicating that
de-escalation-of-commitment is not merely the opposite of the
escalation-of-commitment. Pan et al. (2006b) present an escalation and de-escalation transformation framework to analyze the shift in decision makers’ investments of commitment to a project. However, the early attempts to bridge the connection between escalation-of-commitment and de-escalation-of-commitment have two main limits. First, the studies are not comprehensive about the relationship between escalation-of-commitment and de-escalation-of-commitment. For example, Moser et al. (2013) only specify the relationship between the escalation and de-escalation behavior from the psychology perspective. The work of Pan et al. (2006b) is mainly focused on the escalation and de-escalation behaviors particular in information system (IS) projects. Second, previous studies, to some extent, are over dependent on the staged-models to analyze the relationship between escalation and de-escalation behavior (Pan et al., 2009). A staged-model approach, according to Pan et al. (2009), offers limited overview of how and why decision makers’ investments of commitment escalate or de-escalate. In addition, a staged-model approach has been criticized as mechanistic and unable to deal with today’s turbulent and dynamic environment (Burnes, 2014). Therefore, prior studies offer limited views on the escalation and de-escalation behavior during change projects.
For these two reasons, also following the suggestions of Keil et al. (2000) and Pan et al. (2009) that escalation and de-escalation situations can be seen as instances of approach-avoidance conflicts, this study will deal with the escalation and
de-escalation behavior from the approach-avoidance perspective. The
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the approach-avoidance theory seizes complex situations that influence a decision maker’s mind about whether to escalate or de-escalate investments of commitment to a project (Mann, 2003). By adopting an approach-avoidance perspective, the escalation-of-commitment is viewed as a behavior that happens when the motivating force to the escalation behavior outweighs the resisting force (Brockner & Rubin, 1985). The de-escalation-of-commitment is viewed as a behavior that happens when the resisting force to the escalation behavior outweighs the motivating force. Furthermore, through the approach-avoidance conflict perspective, the interaction of various triggering factors during projects’ processes to the escalation or de-escalation behavior can be integrated in a comprehensive and explanatory way to provide a clear overview of both escalation-of-commitment and de-escalation-of-commitment (Pan et al., 2009).
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The studies and understanding of the escalation-of-commitment and
de-escalation-of-commitment have grown rapidly and have gradually diversified because of the singular view among previous studies. Various explanations to the escalation and de-escalation behavior are also studied in the extant literature. Since the number of escalation studies has grown, it is increasingly difficult to summarize and integrate these studies (Staw & Ross, 1987a). Therefore, there is a need for an analysis and integration of the extant literature to fill in this gap. The goal of the study is to build a bridge between extant escalation and de-escalation studies through the approach-avoidance perspective and to create a clear overview of how and why projects escalate or de-escalate. The research question is formulated as:
What findings can be identified among the extant literature to connect the escalation-of-commitment and de-escalation-of-commitment through a systematic literature review?
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Theoretical background
Escalation-of-commitment
The extant literature concerning the escalation-of-commitment and
de-escalation-of-commitment are relatively separated. The general perspective towards escalation-of-commitment suggests that it is a phenomenon in which decision makers invest additional commitment and resources to a failing course of action. This is recognized as ill-escalation (Staw, 1976; Staw & Ross, 1987a; Pan et al., 2006a; Moser et al., 2013; Drummond, 2014). Escalation behavior is treated as an obvious feature of debatable or completely failed decisions (Sleesman et al., 2012). Moreover, there are also alternative perspectives to escalation-of-commitment. Lee et al. (2015) suggest that escalation-of-commitment is caused by the problem from the interaction between the investments of commitment to a project and the perceived ambiguous feedback on these investments. From this perspective, when commitment is invested and negative feedback is accepted, the escalation behavior will occur (Keil, 1995).
De-escalation-of-commitment
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instead of in one. However, the staged-model approach has already attracted critics for being mechanistic and unfit for today’s turbulent environment (Burnes, 2014). Thus, this study will view escalation and de-escalation behaviors as sequential processes involving approach-avoidance conflicts, considering the turbulent organizational environment. This approach is in accordance with the propositions by Rubin and Brockner (1975) and Pan et al. (2009), that escalation and de-escalation of commitment can be generally seen as instances of approach-avoidance conflicts. With this perspective, a deeper understanding of how and why projects escalate or de-escalate can be developed (Pan et al., 2009).
The approach-avoidance theory
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The Taxonomy Model for Findings
The taxonomy model for findings this study will use is the model of Staw and Ross (1987a). This model consists of four types of factors. The first type of factors is project-related factors, which focus on projects’ objective features and concern why a project is launched in the first place (Pan et al., 2009). The second type of factors is psychological-related factors, which focus on decision makers’ relationship with the project (Sleesman et al., 2012). The third type of factors is social-related factors, which focus on the social groups around the decision maker (Newman & Sabherwal, 1996). The fourth type of factors is structural-related factors, which focus on the structural features of an organization (Staw & Ross, 1987a). This study will integrate this model with the approach-avoidance theory into the coding scheme and findings. By incorporating these four categories, the analysis can be useful as a way of integrating various escalation and de-escalation triggering factors (Sleesman et al., 2012).
Method
Search strategies
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terms, the search was carried out according to the strategies mentioned in table 1. Furthermore, two search engines were chosen based on their relevance to the study topic and the accessibility to the users: Web of Science and EBSCO. Most search engines use several databases but not all of them were relevant for this study because they serve a wide range of research fields (Boonstra et al., 2014). Appendix A provides an overview of the databases used.
Table 1. Overview of the search strategies
Inclusion criteria
After primary research the identified articles were examined with the following criteria to ensure that the article is qualified to be included in this study. First, the included studies should be written in English. Second, the full text is available online.
Search Term used Strategy
[1] “Escalation*” + factor* + project* [2] “Escalation*” + factor* + change* [3] “De-escalation*” + factor* + project* [4] “De-escalation*” + factor* + change*
[5] “Escalation of commitment*” + factor* + project* [6] “Escalation of commitment*” + factor* + change* [7] “De-escalation of commitment*” + factor* + project* [8] “De-escalation of commitment*” + factor* + change* [9] Commitment investment* + factor* + project*
[10] Commitment investment* + factor* + change* [11] “Escalation*” + factor* + process*
[12] “De-escalation*” + factor* + process*
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Third, articles unrelated to the interest of the research topic were excluded from the study. For example, literature about organizational commitment and literature that does not adopt traditional definition of the escalation-of-commitment by Staw (1967) were excluded from this study. Fourth, the various factors that influence decision makers’ commitment investments toward a failing course of action should be discussed in selected studies. When decision makers are influenced by triggering factors during the process of change projects, the escalation or de-escalation behavior by decision makers are involved in the approach-avoidance conflicts. With these criteria, the included articles were in accordance with the perspective and aim of this study. Finally, the articles using non-human research samples were not included in this study. For instance, Macaskill & Hackenberg (2012) use pigeons as research samples, which does not fit the aim of this study.
Data analysis
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or de-escalation behavior from different aspects, the coding scheme used Staw and Ross (1987a) model to categorize all the findings into project-, psychological-, social-, and structural-related findings. After creating these codes and sorting them under their corresponding categories, a general framework for data analysis was formed. Finally, with descriptions of the codes and sources and examples incorporated and put together, the final coding scheme was created. The coding scheme is presented in Appendix C.
Results
Included studies
Applying the 15 search strategies listed resulted in a total of 1034 articles. The searches were carried out on 22nd to 24th of November for search strategies 1 to 8 and
on 25th to 28th of November for search strategies 9 to 15. Many articles were
14 Figure 1. Flow chart of study selection process
Findings
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articles were published between the year 2000 and the year 2010 (including the year 2010), and 2 articles were published in the last five years. This time frame echoes the statement in the introduction that the studies of escalation and de-escalation of commitment have reached, to some extent, maturity. Therefore, a systematic summary and integration of the extant literature is needed. Extracting all findings from the 51 included articles resulted in 23 findings in the first category (Project-related factors), 10 findings in the second category (Psychological-related factors), 4 findings in the third category (Social-related factors), and 5 findings in the last category (Structural-related factors), leading to a total of 42 findings. Tables 2, 3, 4, and 5 show the findings sorted by the categories. The following part will offer explanations to each finding.
Project factors
16 Table 2. Findings in the Project factor category
A1: Uncertain environment. In the extant literature, the uncertain environment
mainly refers to uncertain feedback, information or project’s surroundings (Bowen, 1987[5]; Bragger et al., 1998[6]; Bragger et al., 2003[7]). On the other hand, escalation-of-commitment is treated as an attempt or a by-product of trying to understand a conflicting and confusing environment (Bragger et al., 2003[7]). For
Categories Code Article
Numbers Approach (A)
Uncertain environment A1 5,6,7
Positive sensitivity bias A2 30
Responsible decision makers' preference A3 10,40,45
Large payoff expectation A4 10,31,37
Long-term payoff structure A5 31,35,37
High closing cost A6 31,37,46
Low salvage value A7 31
The degree of project completion A8 11,13,31,46 Avoidance (B)
Regular evaluation of projects B1 12,24,29 Changes in top or project management B2 23,29,35
Appeal to stakeholders B3 23,29,35
Efforts to de-institutionalize the project B4 24,35
Redefinition of the problem B5 49
Implement early warning system B6 12,25,34 Setting of minimum target levels B7 29,42
Intolerance for failure B8 24,46
Separation of responsibility for initiating and evaluating projects B9 2,24
Decision risk B10 22,38,43
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instance, highly uncertain projects’ information will influence decision makers to invest additional resources (Bowen, 1987[5]). Decision makers who receive uncertain feedback also tend to invest more resources than those who receive certain feedback (Bragger et al., 1998[6]). Escalated investments by decision makers who receive uncertain information or feedback will occur until the uncertainty is reduced (Bragger et al., 2003[7]).
A2: Positive sensitivity bias. There is a general decision-making bias termed as a
person’s sensitivity bias (Moon & Conlon, 2002[30]). In the study of Moon and Conlon (2002[30]), the definition of a person’s sensitivity bias by Sears (1983) was used. A person’s sensitivity bias refers to a combination of person’s positivity and negativity biases. When decision makers receive positive performance information of a project, they tend to only focus on the potential positive outcomes of this project because their positivity biases are triggered by the information (Moon & Conlon, 2002[30]). As a result, the likelihood of escalation behavior increases.
A3: Responsible decision makers’ preference. A prominent finding in
18 A4: Large payoff expectation. In the extant literature, some factors focus on the
impact of economic or financial information to the escalation behavior, reflecting the costs and benefits of the project (Brockner, 1992[10]). When a project is considered to be a long-term investment, it is very likely to be escalated by decision makers (Sabherwal et al., 2003[37]). The expected large payoff refers to the benefits those who are involved in the project expect to get (Newman & Sabherwal, 1996[31]). In addition, the large payoff is an element of the long-term investment (Newman & Sabherwal, 1996[31]). Therefore, expectation for large payoff motivates decision makers to escalate project development (Newman & Sabherwal, 1996[31]).
A5: Long-term payoff structure. When a project is considered to be a long-term
investment, it is very likely to be escalated (Sabherwal et al., 2003[37]). The long-term payoff structure is an element of the long-term investment (Newman & Sabherwal, 1996[31]). Thus, the long-term payoff structure motivates decision makers to invest additional commitment to the project (Newman & Sabherwal, 1996[31]; Ross & Staw, 1993[35]).
A6: High closing cost. The closing cost refers to the cost of giving up a project.
When the closing cost is high, decision makers tend to invest additional commitment and resources because the cost of quitting the project is too high to afford (Staw & Ross, 1987a[46]; Sabherwal et al., 2003[37]).
A7: Low salvage value. The salvage value refers to the remaining value for an
ongoing project. Escalation-of-commitment is likely to occur whenthe salvage value of the project is low and there are no feasible alternatives available (Newman & Sabherwal, 1996[31]).
A8: The degree of project completion. When a project approaches completion,
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failure is acknowledged, decision makers tend to escalate commitments into the project because the cost of abandoning the project can be expensive (Staw & Ross, 1987a[46]; Newman & Sabherwal, 1996[31]).
B1: Regular evaluation of projects. In the extant literature, many escalation
behaviors proceed without observation or review (Montealegre & Keil, 2000[29]). Regular evaluation of the project can help decision makers find suspicious investments of commitment (Montealegre & Keil, 2000[29]). When regular reviews and evaluations of projects are conducted and equivocality is found, de-escalation-of-commitment to failing projects is likely to occur (Drummond, 1995[12]; Keil & Robey, 1999[24]).
B2: Changes in top or project management. Top management may maintain its
investments of commitment to a failing project (Montealegre & Keil, 2000[29]). One approach to quit the escalation-of-commitment is a change in top management (Ross & Staw, 1993[35]). Changes in top or project management may allow a reexamination of the project and an opportunity to rethink about the investment of resources, especially towards a failing course of action (Keil, 1995[23]; Montealegre & Keil, 2000[29]).
B3: Appeal to stakeholders. Stakeholders play an important role in the de-escalation
process by making the economics of de-escalation more favorable to decision makers (Ross & Staw, 1993[35]; Montealegre & Keil, 2000[29]). If projects are without new loans or supports, stakeholders prefer to de-escalate the investment to the project because they believe that the project will not be successful (Keil, 1995[23]).
B4: Efforts to de-institutionalize the project. To de-institutionalize a project means
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escalation-of-commitment towards a failing courses of action, either through the termination or through the redirection of projects (Ross & Staw, 1993[35]; Keil & Robey, 1999[24]). Therefore, de-escalation behavior can be facilitated when an organization de-institutionalizes a project (Ross & Staw, 1993[35]).
B5: Redefinition of the problem. The problem redefinition effect occurs when
decision makers change their decisions in response to changes in the belief of the alternatives (Whyte 1986[49]). A redefinition of problems caused by escalation behavior may change the way decision makers’ perspectives toward projects’ interests and may lead to de-escalation behavior (Whyte, 1986[49]).
B6: Implement early warning system. To minimize problems associated with
escalation behavior, decision makers can implement early warning systems that aimed at detecting escalation factors as early as possible (Drummond, 1995[12]; Keil et al., 2000[25]). In most cases, if triggering factors to escalation behavior are observed and responded during the early stage of a project, escalation behavior will be avoided (Pan et al., 2009[34]).
B7: Setting of the minimum target levels. One explanation for escalation behavior
is the lack of clarity to decision makers about what constitutes a project’s success (Montealegre & Keil, 2000[29]). When minimum target levels of projects are established as criteria for defining what is a successful project, troubled projects can be de-escalated (Simonson & Staw, 1992[42]).
B8: Intolerance for failure. Staw and Ross (1987a[46]) suggest that in order to
21 B9: Separation of responsibility for initiating and evaluating projects. Decision
makers are not likely to be objective in evaluating projects that they have contributed to (Barton et al., 1989[2]). An independent evaluation is more likely to produce objective perspective and lead to the de-escalation behavior to the failing project (Keil & Robey, 1999[24]).
B10: Decision risk. Several studies suggest that decision risk increases the possibility
of decision makers’ potential loss (Kahneman & Tversky, 1979[22]) and decreases the possibility of escalation behavior (Schaubroeck & Davis, 1994[38]; Sleesman et al., 2012[43]).
B11: Making opportunity cost information more explicit. The opportunity cost
information provides a clear decision-making standard and allows decision makers to consider alternatives other than escalation-of-commitment (Northcraft & Neale, 1986[32]). Therefore, making opportunity cost information more explicit can promote de-escalation behavior towards failing course of actions.
B12: Decision makers' consideration of causal information. In the study by
Gundlach et al. (2003[17]), the definition of the causal information by Weiner (1995) was used. The causal information refers to perceptions and judgments of decision makers’ responsibility for inappropriate escalation behaviors. Gundlach et al. (2003[17]) suggest that by considering the causal information, decision makers who wrongly escalating commitment can realize the mistake and act de-escalation behavior as a response to the mistake.
B13: Awareness of opportunity costs. The opportunity cost information provides a
22 B14: The availability of alternative investment. Montealegre and Keil (2000[29])
suggest that escalation behavior to one project will decrease the available resources for other projects. Laboratory experiments conducted by McCain (1986[28]) and Northcraft and Neale (1986[32]) show that the availability or consideration of alternative investments to other projects can promote de-escalation behavior.
B15: Recognize the role of ‘exit champions’. Pan et al. (2009[34]) find that decision
makers prefer previously accepted beliefs and preferences. Therefore, it is possible that decision makers will try to prevent a project from de-escalating. To overcome the preference of a previous project, decision makers should be guided to an alternative project and then, negotiate an exit strategy with stakeholders (Montealegre & Keil, 2000[29]). The ‘exit champions’ refers to managers who doubt the previous belief, demand information of the project, and decide when de-escalation behavior is needed (Royer, 2003[36]).
Psychological factors
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findings (from B16 to B20) relate to the de-escalation behavior (avoidance). Table 3 shows the findings for the psychological-related factors. The following part will provide further information and explanation for each factor.
Table 3. Findings in the Psychological factor category
A9: Prior experience or expertise. Decision makers’ prior experience or expertise of
the previous project has influence on their responses to negative feedback of the current project and how they decide over whether to escalate or de-escalate commitment to the project (Bragger et al., 2003[7]; Garland et al., 1990[16]). If decision makers’ prior experience of the previous project is strong, they may continue to support the project even despite problems (Newman & Sabherwal, 1996[31]).
A10: Time investment. Arkes and Blumer (1985[1]) suggest that decision makers are
often captured by the sunk-cost effect. The sunk-cost effect refers to decision makers increasingly willing to invest additional resources in response to previous investments, a phenomenon also called escalation-of-commitment in spite of sunk cost (Arkes &
Categories Code Article
Numbers Approach (A)
Prior experience or expertise A9 7,16,31
Time investment A10 1,43,44
Self-efficacy or confidence of decision maker A11 14,43 Ego-threatened participants A12 3,13,39 Decision makers hold responsibility A13 45
Avoidance (B)
Decision makers' negative emotional attachment B16 13,41,50 Decision makers receiving unambiguously B17 7,16 feedback
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Blumer, 1985[1]). Several studies further suggest that the sunk-cost effect is observable when time investments are expressed as monetary investments because decision makers do not want to waste their investments (Sleesman et al., 2012[43]; Soman, 2001[44]).
A11: Self-efficacy or confidence of decision maker. Self-efficacy represents
decision makers’ perception of their capability to deal with different situations (Erez et al., 1998[14]). In the extant literature, authors suggest that self-efficacy increases decision makers’ persistence to a project, leading to escalation behavior (Erez et al., 1998[14]; Sleesman et al., 2012[43]). Self-confidence, or self-esteem, is the central element underlying positive self-concept (Erez et al., 1998[14]). Decision makers with strong self-concept believe that they can overcome the negative aspects of a situation, leading to escalation behavior (Erez et al., 1998[14]).
A12: Ego-threatened participants. Decision makers’ ego may lead them to look
down upon their predecessors’ work (Drummond, 2014[13]). For instance, managers may over-rate staff if the staff are appointed by them and under-rate staff if they are not appointed by them (Schoorman, 1988[39]). When their ego faces threat, decision makers tend to increase concerns about their reputation. As a result, they will avoid admitting failure (Baumeister & Zhang, 2006[3]). This will lead to escalation behavior.
A13: Decision makers hold responsibility. Staw (1976[45]) conducts an experiment
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project when they are personally responsible for the negative consequence (Staw, 1976[45]).
B16: Decision makers' negative emotional attachment. Decision makers tend to
de-escalate projects that cause negative emotions (Drummond, 2014[13]). In addition, the loss of a failed project can cause decision makers’ negative emotional reactions (Shepherd, 2003[41]). Escalation behavior can increase decision makers’ negative emotions by letting them recognize the project’s loss, triggering decision makers to de-escalate the project (Wong et al., 2006[50]).
B17: Decision makers receiving unambiguously feedback. Decision makers who
receive equivocal feedback on their decisions will invest additional resources to the project (Bragger et al., 2003[7]). On the other hand, Garland et al. (1990[16]) use three experiments to show that the escalation behavior is not obvious in the presence of unambiguously negative feedback. Therefore, unambiguously feedback of the project can lead to de-escalation behavior.
B18: Publicity about resource limits. When projects’ resource limits are publicly
stated, decision makers are more likely to follow them (Brockner et al., 1979[8]). Heath (1995[18]) terms this situation as mental budgets, which decision makers set a budget for the expense and track their investments against budget. From this perspective, decision makers are only likely to escalate commitment when they fail to set a budget or when investments are difficult to track. Therefore, one way to promote de-escalation behavior is the publicity about resource limits (Montealegre & Keil, 2000[29]).
B19: Management of impressions. Impression management refers to those decision
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images that others have about them, de-escalation behavior towards a failing course of action is likely to occur (Montealegre & Keil, 2000[29]).
B20: Net anticipated regret about persistence. Net anticipated regret refers to the
regret that one anticipates experiencing in the future (Wong & Kwong, 2007[51]). Wong and Kwong (2007[51]) suggest that there is a positive relationship between the net anticipated regret about de-escalation and escalation-of-commitment. That is,
escalation-of-commitment increases as the net anticipated regret about
de-escalation-of-commitment increases. Thus, escalation-of-commitment is
negatively related to anticipated regret about persistence. (Wong & Kwong, 2007[51]).
Social factors
27 Table 4. Findings in the Social factor category
A14: Groups with high group cohesiveness. Group cohesiveness refers to the
collection of individuals who identify with a group and who may receive perception and judgment by group members (Hogg & Terry, 2000[19]). In addition, there is evidence show that the critical component of cohesiveness linked with groupthink is social attraction (Hogg & Terry, 2000[19]). Therefore, when individuals exhibit escalation behavior, the same behavior is likely to occur in the cohesive group that the individual is in as a social attraction (Sleesman et al., 2012[43]).
A15: Public identification with the project. People’s social identity can be shaped
by their actions (Staw & Ross, 1987a[46]). Decision makers will be closely identified with a project when their suggestions to the project are public and explicit (Staw & Ross, 1987a[46]). Hence, escalation behavior may occur if public identification increases.
A16: Resistance of decision makers. Challenges of projects will increase decision
maker’s responsibility. The increase in the personal responsibility leads to policy resistance (Sleesman et al., 2012[43]). When job insecurity and policy resistance increase, commitment to a previous course of action will also be increased (Fox & Staw, 1979[15]).
A17/B21: The effect of the environmental contingency. Both problems and
opportunities may rise from contingencies in the organizational environment (Lederer
Categories Code Article
Numbers Approach (A)
Groups with high group cohesiveness A14 19,43 Public identification with the project A15 46 Resistance of decision makers A16 15,43
Either Approach (A) or Avoidance (B)
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& Mendelow, 1990[27]). The study of Lederer and Mendelow (1990) used the definition of organization’s environment by Duncan (1972). The term is defined as the physical and social factors outside the organization or project but are still related to its success. The level of commitment varies over time because factors determining it are affected by changes in the organizational environment (Lederer & Mendelow, 1990[27]). So, both of the escalation and the de-escalation behavior can occur because the motivating force and the resisting force of this factor is changing all the time.
Structural factors
Structural factors represent the contextual conditions around a project (Newman & Sabherwal, 1996). These factors include political support for the project, administrative inertia in the organization and the extent to which the project is institutionalized (Staw & Ross, 1987a). In this category, the first 2 findings (A18 and A19) relate to the escalation behavior (approach). The last 3 finding (from B22 to B24) relate to the de-escalation behavior (avoidance). Table 5 shows the findings for the structural-related factors. The following part will provide further information and explanation for each factor.
Table 5. Findings in the Structural factor category
Categories Code Article
Numbers Approach (A)
Slack resources A18 23
"Empire building" A19 23
Avoidance (B)
Eliminate administrative inertia B22 31,47
Strong ethical environment B23 4
29 A18: Slack resources. In the study by Keil (1995[23]), the perspective towards slack
resources was in line with the perspective by Dolmans et al. (2014). Slack resources can improve organization’s financial performance (Dolmans et al., 2014). As a result, absorbed slack resources increase the level of sunk-cost effect, which potentially increasing the likelihood of escalation behavior (Keil, 1995[23]).
A19: Empire building. Keil (1995[23]) points out that ‘empire building’ is a
motivating factor to escalation of commitment. The ‘empire building’ means that decision makers invest additional resources to the project in order to protect their status or positions in an organization (Keil, 1995[23]).
B22: Eliminate administrative inertia. Administrative inertia refers to decision
makers behave according to their beliefs and organizations base practices on preferences (Staw & Ross, 1987b[47]). Staw and Ross (1987b[47]) point out that the simplest element blocking de-escalation behavior from the failing project is administrative inertia. By eliminating administrative inertia, individuals behave without previous beliefs and organizations do not base practices on preferences. Therefore, new routine can be established. The new routine may lead to a de-escalation behavior towards a failing course of action (Staw & Ross, 1987b[47]; Newman & Sabherwal, 1996[31]).
B23: Strong ethical environment. When organization has low level of ethical
environment, decision makers may act in a self-interested way and escalate resources to failing course of actions (Booth & Schulz, 2004[4]). Therefore, a strong ethical environment in the organization will be effective in decreasing decision makers’ tendency to continue failing projects (Booth & Schulz, 2004[4]).
B24: Top management support. Scholars have implicitly referred this factor to other
30
towards a failing project is found to be a structural determinant (Johnston & Carrico, 1988[21]; Vitale et al., 1986[48]).
Discussion
This review on the extant literature regarding the escalation and de-escalation of commitment provides insight in how and why projects escalate or de-escalate and tries to bridge escalation and de-escalation studies. Included articles originate from all over the world, this shows the global attention in escalation and de-escalation of commitment to projects. Only two selected articles were published in the last five years. This can mean that the extant literature has reached, to some extent, academic maturity (Sleesman et al., 2012). The approach-avoidance theory and the Staw and Ross (1987a) model are used in this review to categorize and integrate findings. A total of 42 findings were extracted from included studies. Generally, there are 19 motivating factors to escalation behavior (approach) and 24 resisting factors to escalation behavior (approach), which will cause de-escalation behavior (avoidance). Finding A17/B21 is a special contingent factor that accounts for both the approach and the avoidance section. Almost 75 percent of the findings are project- and psychological-related factors while the social- and structural-related factors are less studied. Each finding is explained in the previous section but there are several highlights and further interpretation required. The following part will take a comprehensive view of the findings in order to discuss how these findings inform the study aim.
31
minimum project target levels to reveal the deficiency (B6 and B7). Evidence shows that once decision makers realize and deal with the deficiency of a failing project, potential escalation behavior will be avoided and de-escalation behavior will be more likely to occur (Pan et al., 2009). In addition, methods like publicity about resources limit (B18) can help decision makers realize the project’s deficiency. The realization of project’s deficiency potentially emphasizes the importance of regular evaluation of the project (B1). By evaluating the project regularly, de-escalation methods can be applied. The project’s deficiency therefore, can be spotted by decision makers in a real-time fashion. As a result, the decision maker’s ‘exit champion’ role to the project can be formed (B15). The managerial implication for decision makers is that managing a project should be active, especially in the regular review of an ongoing-project. Decision makers may need several methods to discover the deficiency and to terminate the project if necessary. The implication for future research is that more studies can be aimed towards finding out more approaches to detect deficiency of a project.
32
management. The implication for future research is that current knowledge of the relationship between individual and group norms and escalation or de-escalation behavior is mainly on the social level. As indicated by Sleesman et al. (2012), the escalation and de-escalation behavior study is rooted in the psychological background. There is a need to discover the relationship between individual or group norms and escalation or de-escalation behavior on the psychological level.
Third, there are three findings (A1, A17/B21, and B23) concerning the organization’s internal and external environment that influence the escalation and de-escalation behavior. For the external factor (A17/B21), this contingent factor shows that organization’s external environment is dynamic and always changing, leading to both problems and opportunities (Lederer & Mendelow, 1990). For the internal factors, organization’s uncertain environment (A1) is found to be a trigger for the escalation behavior (Bragger et al., 2003) while a strong ethical environment (B23) in the organization is found to be a trigger for the de-escalation behavior (Booth & Schulz, 2004). Therefore, this study suggests that internal and external environmental factors influence projects from various aspects. There are still many aspects of the environment, internally and externally, for the future research to discover. For instance, different cultural environments’ influence on the escalation and de-escalation behavior. The implication for decision makers is that environments are changing all the time. Therefore, the management approach should also be adjusted according to the environmental change.
33
also partly due to decision makers simply expecting for a positive outcome after continuous investments of valuable resources (A3). On the other hand, by bridging escalation and de-escalation studies, this review also suggests that de-escalation behavior can be triggered when a decision maker’s goal is to impact images that others have about him/her by maximizing social rewards (B19). Therefore, by bridging escalation and de-escalation studies, it can be seen that findings belong to one subject can have distinct influences to escalation behavior. The managerial implication is that too much responsibility on one decision maker may cause wrong decision making. An even distribution of the responsibility for a project to other decision makers may be helpful in making rational decisions.
34
of considering suggestions from organization’s accounting or financial department when making a decision.
By bringing the findings together, we can see that considerable amount of findings in different categories are intertwined under several subjects instead of mutually independent. There are common elements and relationships among those factors. In addition, by bridging escalation and de-escalation studies, different aspects in a subject, such as the environment subject, can have distinct influences to escalation or de-escalation behavior. Knowledge gaps in some research fields are also identified with future research suggestions. This discussion informs the contribution of this study that an overview of the current state of escalation and de-escalation studies will be provided by bridging the extant literature on the escalation and de-escalation behavior. Table 6 provides the overview of findings categorized by subjects.
35 Table 6. Findings sorted by subject
Conclusion
The number of studies about escalation and de-escalation behavior is growing. This systematic literature review has addressed 51 selected articles and derived 18 findings on escalation of commitment (approach), 23 findings on de-escalation of commitment (avoidance) and one finding that accounts for both escalation and de-escalation of commitment. These findings provide an overview of how and why projects escalate or de-escalate by bridging the escalation and de-escalation studies. It can be seen that project- and psychological-related factors are most studied while social- and
Subject Related findings Number of
articles
Project's deficiency and its effect B1, B4, B5, B6, B7, B9, B15, 16
B16, B18
Individual or group norms B8, A14, A15, A16, B10, B22 11
Environment A1, A17/B21, B23 5
Self-esteem/confidence, reputation, A3, A11, A12, A13, B12, B19 8
and the responsibility effect
Economics A4, A5, A6, A7, A10, B3, 12
B11, B13, B14
Other independent subjects
Project performance trend A2 3
Degree of completion A8 4
Changes in top managers B2 3
Experience A9 3
Feedback B17 2
Decision regret B20 1
Slack resource A18 1
Empire building A19 1
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structural-related factors are less studied. The discussion of findings shows that some of the factors are interrelated. Various factors among four categories can have common elements and sometimes can trigger other factors. Different aspects in a subject can have distinct influences to the escalation or de-escalation behavior. Knowledge gaps, future research directions, and managerial implications are also provided. Therefore, the research question is answered by the systematic review of the extant literature.
The academic contribution of this study can be concluded as a summary and integration of escalation and de-escalation studies. Those who are interested in this area can obtain current knowledge and can use this study as a fundamental article for the further research into a specific area. In addition, by using approach-avoidance perspective, this study also acts as a complementary to the extant literature, the majority of which are based on the staged models.
37
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47
Appendix A - List of databases
Web of Knowledge:
1. Web of Science
2. Data Citation IndexSM 3. Journal Citation Reports
EBSCO:
1). Academic Search Premier 2). America: History & Life
3). Business Source Premier 4). Communication & Mass Media Complet
5). eBook Academic Collection
(EBSCOhost) 6). eBook Collection (EBSCOhost)
7). EconLit 8). Library, Information Science & Technology
Abstracts
9). Military & Government Collection 10). MLA Directory of Periodicals
11). MLA International Bibliography 12). Philosopher's Index
13). PsycARTICLES 14). PsycBOOKS
15). PsycCRITIQUES 16). Psychology and Behavioral Sciences Collection
17). PsycINFO 18). Regional Business News
Article Author Study focus Main objective of the study Type of Data collection Impact Citations**
Number research factor*
[1] (Arkes & Escalation of Those who had incurred a sunk cost inflated their estimate Quantitative Survey & Interview 3.938 1865 Blumer, commitment of how likely a project was to succeed compared to the & Qualitative
1985) estimates of the same project by those who had not incurred a sunk cost.
[2] (Barton et al., De-escalation Test two major prescriptions of Staw and Ross about the Quantitative Experiments 2.506 64 1989) of commitment management of escalation behavior in organizations. & Qualitative
[3] (Baumeister Escalation of Threatened self-esteem would cause decision makers to Quantitative Experiments 3.527 46 & Zhang, commitment invest and, as a result, lose more money in a previously
2006) chosen course of action
[4] (Booth & Escalation of Strong ethical environment will be effective in reducing the Quantitative Laboratory 3.588 78 Schulz, 2004) commitment tendency for managers to continue failing projects in both experiment
the presence and absence of agency problems.
[5] (Bowen, Escalation of Earlier studies may have observed decisions to recommit Qualitative Literature analysis 10.736 256 1987) commitment resources resulting from difficult dilemmas rather than a
49 [6] (Bragger et Escalation of An uncertain environment can affect whether a decision Quantitative Survey 3.938 60
al., 1998) commitment maker continues to invest when costs are higher than profits. & Qualitative
[7] (Bragger et Escalation & There was an inverse linear relationship between the Quantitative Survey 7.753 75 al., 2003) De-escalation percentage of opportunities in which participants purchased & Qualitative
of commitment information and the delay to exit decisions and total resources invested.
[8] (Brockner Escalation of It was found that: (1) Participants invested significantly more Quantitative Survey 3.14 216 et al., 1979) commitment (resources)in the Self-sustaining than the Self-terminating & Qualitative
condition; (2) those in the Control condition invested somewhat more (resources) than those in the Public condition; (3) Private condition subjects deviated more from their earlier set limits than did Public subjects.
[9] (Brockner Escalation of Entrapment would be influenced by the relative importance Quantitative Experiments 3.14 189 et al., 1981) commitment individuals attach to the costs and rewards associated with & Qualitative
continued investments.
[10] (Brockner, Escalation of The article describes several research strategies that may Qualitative Literature analysis 10.736 990 1992) commitment lead to progress in explaining escalating commitment.
[11] (Conlon & Escalation of The higher the sunk cost, the less likely geologists were to Quantitative Experiments & 9.812 159 Garland, commitment authorize funds to continue with the venture and the lower & Qualitative Survey
50 [12] (Drummond, De-escalation De-escalation is likely to occur when the opposite conditions Qualitative Case study; Survey 5.883 63
1995) of commitment to persistence apply, emphasizing the importance of power. & Interview
[13] (Drummond, Escalation & This paper explores what might drive organizations to Qualitative Literature analysis 5.427 1 2014) De-escalation erroneously abandon a potentially successful project.
of commitment
[14] (Erez et al., Escalation of The principle reason that positive self-concept is linked to Qualitative Literature analysis 1.552 541 1998) commitment job performance is because positive employees are more
motivated to perform their jobs.
[15] (Fox & Staw, De-escalation As job insecurity and policy resistance increased, so did Qualitative Case study & 7.313 322 1979) of commitment commitment to a previously chosen course of action. Results Literature analysis
support the idea that the trapped administrator is one who is most likely to become committed to a policy position and remain inflexible to change in the face of negative
consequences.
[16] (Garland et De-escalation Three experiments were conducted to examine the effects of Quantitative Experiments 7.753 150 al., 1990) of commitment sunk costs and negative feedback on decisions to escalate & Qualitative
or withdraw from a petroleum-exploration venture. Results were in the same direction as that found with the geologists but were considerably weaker.
[17] (Gundlach De-escalation The article integrates the power, justice, and prosocial Qualitative Literature analysis 10.736 203 et al., 2003) of commitment literature on whistle-blowing with the attribution and
