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Escalation and entrapment in decision-making
Managers in organizations often find themselves in difficult situations since they are required to make optimal decisions, even when most of the odds are starkly not in their favor. It is because previous decisions that are required to form a basis of the current ones did not go as earlier envisaged. The managers therefore make decisions based on the wrong premises in the hope that the situation will improve. Such situations are normally characterized by increased judgmental traps and scenarios of escalation and entrapment. It is because the costs of retracting their earlier decisions have severe consequences that can even put their jobs on the line.
Rubin & Brockner (1975) depict how managers suffer from conflicts when making decisions. These conflicts arise due to escalation of the issues, where the decisions is to be made on whether to continue committing resources to the projects that have failed or that are showing indications of no success. Most of the managers fail to objectively analyze available feedback on a failing project and continue to commit resources to the projects that show clear indications that they are destined for failure.
Bowen (1987) provides various reasons that lead to the escalation of the problem. One of these reasons is that managers like taking personal responsibility over projects that appear destined for failure. They commit so many resources to such projects so that as time goes on, they cannot contemplate failure. Such managers often use past events to justify their actions.
The element of time becomes a defining element in the prevalence of escalation problems since it can be seen both as an investment and an expense. It is because as managers commit more resources to a project, it becomes hard for them to withdraw or stop the problem from continuing. It is because they consider the costs of withdrawal from such a project hefty and to be a poor reflection of their managerial capabilities. Costs for maintaining such projects continue to increase with time. The managers also continue being convinced that their project is destined to succeed over time. Therefore, it becomes clear that as time goes by, the managers continue being under intense pressure to act in a decisive manner to either save resources by withdrawing from the project or to commit more resources to experience success.
A manager caught in situations of either total commitment or withdrawal from a project is more likely to opt for total commitment to such projects. It is mainly owing to perceptions of close proximity to the goal due to the thoughts of resources invested and time it has taken. It is also based on the perceived costs of abandoning or giving up on the project (Whyte 1986). It leads to waiting for conflicts that escalate as time passes. The manager is caught up in approach-avoidance conflict since the project has progressed and options of withdrawing are usually minimal.
Staw & Ross (1987) provide various steps that managers in organizations can take in order to avoid being overcommitted to the projects that eventually fail or are destined to fail. One of the ways that can help managers make appropriate decisions and avoid overcommitment is asking themselves various questions regarding projects in question. They can ask themselves whether they have any problems identifying indicators of failure for particular project. Such indicators should be clear and coherent with no elements of ambiguity. If managers find difficulty defining such indicators, then they should know that it is difficult to establish or realize when they are being unrealistic and overcommitted to such a project. Managers should also evaluate their commitment to the problem by asking themselves, if this project fails, will it be the end of the world for me? If the answer is yes, then the manager should realize that there is more likelihood of being overcommitted to the project.
Managers should also consider changing administrators and key personnel of a project. Such changes reduce the level of entrapment since the initial originators of a project normally have more attachment to it than new people. It is because commitment among the initial originators of the project can originate from psychological feelings of attachment that can be reduced if such officials are deployed elsewhere. Such personnel changes also add symbolic value to the organization besides reducing the risk of overcommitment. It is also possible for organizations to have separate decision makers for every project. Decision-making roles should be played by distinct teams. It ensures that there is objectivity in most of the decisions made and eliminates possibilities of entrapment of officials through judgmental traps and dilemmas.
An organization can also increase its information systems so that the risks involved in making or taking various positions are objectively available. It can be done through seeking advice of professionals in specific areas related to a project that is to be undertaken. Such objective assessments can reveal various risks and pitfalls that enable managers to make right decisions before embarking on a project.
Managers must develop awareness of the existence of various conflicts in their decision-making roles. They must have defined methods of analyzing the nature of feedback they receive on projects so that they can make proper decisions. Such analysis must reveal whether a project meets defined standards. It is also proper for managers to delink projects from the core operations of the organization. It permits the objective assessment of the viability of a project since it is considered peripheral and not a core operational basis of an organization.