When decision makers realize that a previously selected course of action is failing, inevitably, they are confronted by a dilemma. On one hand, they could withdraw the remaining resources, saving them for alternative investments. On the other hand, they could persistently select to maintain their initial decision in hope of favorable outcomes. Röber (2018) has documented tendencies among decision-makers of escalating commitment to previously selected courses of action even when objective evidence suggests otherwise. Fundamentally, decision-makers commit resources to a course of action in anticipation of a positive outcome. Notably, the risk of an escalation of commitment increases once the investment has been made but the results are disappointing (Drummond & Hodgson, 2016).
Critically, the term escalation of commitment applies only to instances where objective evidence implies that maintaining a chosen course of action is unwise yet the decision-maker invests further. According to Röber (2018), there are several explanations for this phenomenon. Self-justification theory observes that decision-makers feel personally responsible for investments that have gone south increasing the risk of failure and enhances the decision-makers desire to justify the original decision. Then, negative feedback on past investment decisions raise questions about the validity of the original decision and is dissonant with the decision-makers need for self-competence (Drummond & Hodgson, 2016 ) . To eliminate this conflict, many such decision makers convince themselves that investing more resources will turn around the investment. Potentially, success through such a course of action will validate the initial decision and eliminate the conflict based on negative feedback.
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Personally, my experience of this phenomenon occurred when I made the decision to start my own barbershop while still in employment. My partner managed the daily operations while I looked after the finances. Objectively, it was obvious that the business in which I had invested was not turning a profit, I kept investing both time and money hoping to turn it around. I realize I should have cut my losses the instant it started making losses plus I solely relied on my partner’s insights in decision-making. Ideally, I should have spent more time on researching the business.
Question 2
The instantly associated meaning with the noun organization is an ordered group of people with a purpose. Further advancing this notion is the meaning attached to the phrase organizational behavior , the study of how people interact within such groups. Essentially, this scientifically approached study is premised on the behavior of people as they interact with ordered systems (Griffin & Moorhead, 2014). Then again, the outcomes of this study find application in increasing efficiency among organizations. Put differently, executives and human resource professionals use insights obtained from organizational behavior to illuminate among other things organizational culture and its impact on either productivity or employee retention.
Griffin & Moorhead (2014) comment that organizational behavior itself has sections that focus on both individual and group dimensions. For instance, sections on personality, job satisfaction, and reward management investigate phenomena at the individual level while authority, power, politics, and leadership focus on the group dynamics. Notably, the word organization also names the action of putting something in order. Rationally, then, organizational behavior contributes significantly to an illuminating understanding of the nature of the interaction between people and the purpose for which they have ordered themselves to achieve.
Furthermore, this discipline is based on other studies that study human behavior such as leadership studies, anthropology, and ethnography along with computerized models to investigate ideas (Griffin & Moorhead, 2014). Therefore, it was simply about people, mentioned disciplines would have been sufficient in generating understanding. Considering the existence and application of insights from organizational behavior, this is not the case. Therefore, this discipline though largely based on people provides the better understanding of the influence people have on organizations and vice versa. Therefore, this discipline provides value and is not pointless as it illuminates understanding of human behavior under the specific requirement of the organization.
References
Drummond, H., & Hodgson, J. (2016 ). Escalation in Decision-Making: Behavioural Economics in Business . Boca Raton, Florida: CRC Press.
Griffin, R. W., & Moorhead, G. (2014). Organizational Behavior: Managing People and Organizations . Ohio: South-western.
Röber, B. (2018). Escalation of commitment in internationalization processes: The role of bounded rationality in the Uppsala Model . Cham, Switzerland: Springer.
