Pathological Persistence

Oh, the movie never ends
It goes on, and on, and on, and on
--Journey

Alex Berenson observes that many bureaucrats (and their media minions) have locked themselves into a destructive policy path (and narrative) that they can't seem to stop. In many ways, it seems they are turning up the volume despite evidence that suggests they should be dialing it back.

1/ The Santa Clara findings, the Boston homeless shelter and French carrier data, the @hendrikstreeck German serology study, even the @unherd interview all align - #COVID will likely have fatalities 1.5x to 3x that of the flu - though not in the young, who are at very low risk...

— Alex Berenson (@AlexBerenson) April 18, 2020

3/ So what are we doing now? Especially with the economic hit turning out to be greater than the worst-case forecasts and hospitals outside New York emptying out and laying off employees? How come we can't change course?

— Alex Berenson (@AlexBerenson) April 18, 2020

5/ We seem to have locked ourselves into a position where we need to justify the damage we've already caused, instead of recognizing the harm and stopping it. Unless, of course, some people out there really prefer the streets empty and workplaces and stores shut.

— Alex Berenson (@AlexBerenson) April 18, 2020

In the mid 1970s, researchers became interested in the phenomenon of pathological organizational persistence. Why is it that some organizational actions, once initiated, seem difficult to stop--especially in the face of evidence telling them that the initiatives weren't producing favorable outcomes?

A particularly interesting thread of this research studied 'escalation of commitment.' Spanning nearly two decades, these studies examined tendencies of individuals and organizations to become locked into losing situations and to 'throw good money after bad.' Results suggested that economic determinants of a project along with various psychological, social, and organizational forces likely play roles in the escalation phenomenon.

Moreover, there appears to be a temporal effect, meaning that certain factors matter more at certain phases of the project. For instance, a project's economic determinants might shape early commitment, but psychological and social factors serve to reinforce and escalate commitment as time goes by.

Concluding a paper that extended their already impressive body of work, Ross and Staw (1993) proposed several situations likely to escalate, or to make it difficult to exit/reverse, a failing course of action:

• Early introduction of organizational determinants such as internal political support, 'side bets' such as hiring of staff, or how closely the project is seen as tied to core values and objectives.
• Alignment of external political forces with the project.
• Ambiguous and changing economics of the project.
• When potential losses become so large that withdrawal might lead to bankruptcy (organization-wide failure).
• When managers venture far from their areas of expertise.
• When technological changes cause major changes in organizational context such that previously learned procedures and decision checks no longer apply.
• When it is perceived that there is no replacement for the products or services of the organization, external parties (including government and interest groups) will seek to prevent withdrawal from a failing course of action, resulting in what amounts to preserving a permanently failing organization.

On the other hand, the following situations may facilitate withdrawal from a losing course of action:

• Changes in top management that reduce psychological and social sources of commitment.
• Efforts to deinstitutionalize the project to separate the project from the central goals and purposes of the enterprise (i.e., reducing organizational determinants of escalation).
• Appeals to external constituents for resources that would make withdrawal less costly.

We are surely witnessing the escalation dynamic at work right now. Past research can help us understand it and offer paths for how to get off the ride.

Reference

Ross, J. & Staw, B.M. (1993). Organizational escalation and exit: Lessons from the Shoreham nuclear power plant. Academy of Management Journal, 36: 701-732.