Risk of making the wrong decision

Quite a few methods, frameworks, approaches, and what-not are on the market to help organizations “transform.” They promise to guide you through a long journey in which nearly everything about your organization changes, step by step…or, in some cases, they demand that you change many things about the organization immediately.

Decision-makers are in a difficult situation. Proponents of each available method or framework insist their product is the best one, and yet it’s hard to distinguish between any two of them except insofar as they use different buzzwords for the same concepts, and draw different diagrams of the same processes.

The typical pattern is that an executive chooses a method or framework and commits large sums of the organization’s money and time to implementing that solution. Once that decision has been made, it’s problematic to reverse it for two main reasons:

  1. Escalation of Commitment, also known as Sunk Cost Fallacy. This is a psychological phenomenon in which people who have made a significant commitment to a course of action are loathe to conclude it was a poor decision. While we can all agree that it’s best to cut our losses early rather than late, it’s human nature to hang on to the choices we’ve already made, and try as hard as we can to make them work.
  2. Political cost or career risk. If you’re the person who made the decision to adopt the method or framework, and it proves to have been a poor choice, it’s very possible you will suffer some form of political cost, or that your career advancement will be in jeopardy, depending on the nature of your organizational culture. Even if you can overcome the Sunk Cost Fallacy on a personal level, it may be infeasible for you to raise the issue. You may simply have to stay on the train no matter where it ends up.

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