Elsevier

Information & Management

Volume 40, Issue 8, September 2003, Pages 781-798
Information & Management

Escalating commitment to information system projects: findings from two simulated experiments

https://doi.org/10.1016/S0378-7206(02)00104-0Get rights and content

Abstract

Commitment to an information system (IS) development project is essential for system success. However, some projects exhibit escalation of commitment, i.e. allocation of additional resources to a failing course of action. This paper describes two simulated longitudinal experiments examining the effects of project, psychological, social, and structural factors during four stages of an IS project. The results support escalation in IS projects. Moreover, project factors and psychological factors, but not structural factors, seem to aid escalation. Project, psychological, and social factors also have different effects during various stages.

Introduction

“We have made some contractual commitments, some of which have been fulfilled and we have got some significant sunk costs in the software package … so it’s clear we are going to proceed” (interviewee comment in [39]).

The above remark illustrates the phenomenon that has been variously described as “escalation of commitment” [20], [37], [42], “runaway information technology (IT) projects” [1], and “entrapment” [8], [18]. This phenomena has been studied by social psychologists and organizational behaviorists for a long time [51], [52], [56] and has recently been examined in the context of information systems (IS) projects, because managers, over time, make decisions on allocation of resources to a particular course of actions (such as a development project) [32]. Escalation occurs when managers who made the initial decision continue, or further increase, their commitment when faced with substantial setbacks [12]. Researchers in this area have examined the factors that engender escalation, offered and compared several theoretical explanations for it [7], [59], and provided suggestions for reducing it [43]. The factors influencing commitment have been classified into four broad determinant types: project, psychological, social, and structural [54]. These four were also observed in two case studies of escalation in IS projects. Here, we contribute to the understanding of escalation in IS projects by systematically assessing their effects.

A temporal sequencing of the effect of these four determinants has been suggested. This has been supported in non-IS cases (Expo 86 and the Shoreham Nuclear Power Plant), but not in cases on escalation in IS projects. We empirically investigate whether any such ordering should be expected.

A third objective of the paper specifically concerns two determinants—personal responsibility for failure (a psychological factor associated with one’s own perception of responsibility) and responsibility for failure (a social factor related to the organizational consequences of one’s responsibility). Prior examinations of these determinants have produced conflicting results.

In order to address the research questions, we conducted two experiments using student subjects that simulated an IS project in trouble. This allowed us to examine the effects of specific variables using a large sample of subjects and to examine escalation under a variety of controlled circumstances that would not have been possible in field studies. While our reliance on student subjects limits the generalizability of the results, we still gained valuable insight into the phenomenon of escalation, especially when our results are considered in conjunction with prior studies.

Section snippets

Theoretical background

Three major arguments are implicit in the literature. First, escalation of commitment does occur in some IS projects. Second, it depends on a number of factors, which may be classified into project, psychological, social, and structural determinants. Third, the dynamics of commitment will change: different factors influence commitment during the various stages of a project.

Data collection

We empirically assessed the effects of the determinants at different stages of the IS project using a simulation. Test subjects interacted with specially written software that provided them scenarios for four different stages and asked them a series of questions about each. Haunschild et al. used a similar method to study escalation of commitment to corporate acquisition decisions. Our subjects were student volunteers who received extra credit for participating in the experiment. For the

The subjects

Table 2 summarizes key characteristics of the subjects. In Experiment 1, we collected data from 86 graduate and undergraduate students enrolled in a business school at a large state university. Eight were graduate students, 67 were undergraduate seniors (fourth year students) and 11 were undergraduate juniors (third year students). They included 45 females and 41 males: 72 were IS majors. Fifty-five of the students had at least some full-time work experience, and only seven had no full-time or

Conclusions

Before we discuss the implications of our findings, identification of some limitations of the study is in order. First, our use of student subjects can raise questions about how closely tied we are to reality [50]. The generalizability of our results to a population of experienced managers can be questioned. However, we took several precautions to mitigate this issue. Our subjects were not naive about either IS or project issues in general, with most of them having between 3 and 5 years of full

Acknowledgements

We are grateful to Professor Edgar H. Sibley and three anonymous reviewers for their suggestions on earlier drafts of this paper.

Rajiv Sabherwal is the Emery C. Turner Professor of Information Systems at University of Missouri, St. Louis. Dr. Sabherwal’s research focuses on knowledge management, strategic management of IS, and social aspects of systems development. He has published on these topics in Information Systems Research, MIS Quarterly, Organization Science, California Management Review, Communications of the ACM, Journal of MIS, and several other journals. He is an Associate Editor for MIS Quarterly, and a

References (60)

  • A.C Boynton et al.

    Information technology planning in the 1990’s: directions for practice and research

    MIS Quarterly

    (1987)
  • J Brockner

    The escalation of commitment to a failing course of action: toward theoretical progress

    Academy of Management Review

    (1992)
  • T Chi et al.

    Cognitive limitations and investment “Myopia”

    Decision Sciences

    (1997)
  • J. Cohen, Cohen, Applied Multiple Regression/Correlation Analysis for the Behavioral Sciences, Lawrence Erlbaum...
  • M. Davis, Bobko, Contextual effects on escalation processes in public sector decision-making, Organizational Behavior...
  • H. Drummond, Escalation in Decision-making: The Tragedy of Taurus, Oxford University Press, Oxford,...
  • K.M Eisenhardt

    Agency theory: an assessment and review

    Academy of Management Review

    (1989)
  • K Ewusi-Mensah et al.

    On information systems project abandonment: an exploratory study of organizational practices

    MIS Quarterly

    (1991)
  • L Festinger

    A theory of social comparison processes

    Human Relations

    (1954)
  • L. Festinger, A Theory of Cognitive Dissonance, Row, Peterson, Evanston, IL,...
  • F Fox et al.

    The trapped administrator: the effects of job insecurity and policy resistance upon commitment to a course of action

    Administrative Science Quarterly

    (1979)
  • R.D. Galliers, Information systems planning in the United Kingdom and Australia: a comparison of current practice, in:...
  • H Garland

    Throwing good money after bad: the effect of sunk costs on the decision to escalate commitment to an ongoing project

    Journal of Applied Psychology

    (1990)
  • D Ghosh et al.

    Risk, ambiguity, and decision choice: some additional evidence

    Decision Sciences

    (1997)
  • M.J Ginzberg

    Key recurrent issues in the mis-implementation process

    MIS Quarterly

    (1981)
  • E. Goffman, The Presentation of Self in Everyday Life, Doubleday-Anchor, New York,...
  • V Grover

    From business reengineering to business process change management: a longitudinal study of trends and practices

    IEEE Transactions on Engineering Management

    (1999)
  • V. Grover, A.L. Lederer, R. Sabherwal, Recognizing the politics of MIS, Information and Management (1988)...
  • P.D Harrison et al.

    Impact of “adverse selection” on managers’ project evaluation decisions

    Academy of Management Journal

    (1993)
  • P.R Haunschild et al.

    Managerial overcommitment in corporate acquisition processes

    Organization Science

    (1994)
  • Cited by (31)

    • Understanding the success of strategic IT benchmarking—Exploring the role of the individual level

      2019, Information and Management
      Citation Excerpt :

      Similar notions can be found in the research stream on commitment continuity in projects, in which satisfaction with the outcomes of preceding steps influences the willingness to follow a course of action [85,86]. A negative drawback of such continued engagement is that, for example, projects that are about to fail are provided with more resources [70]. In SITBM, this effect also has positive implications: complex strategic undertakings will be pursued even when difficulties arise [87].

    • Impact of organisational climate and demographics on project specific risks in context to Indian software industry

      2012, International Journal of Project Management
      Citation Excerpt :

      To enable any changes successfully, the developer must know the configuration of the system and how changes will affect the system. For this an up-to-date documentation and configuration control is extremely important (Ozoa, 2006; Sabherwal et al., 2003). Beside this, it has also been observed that the software developer does not perform adequate testing.

    • Escalating commitment in the death zone. New insights from the 1996 Mount Everest disaster

      2011, International Journal of Project Management
      Citation Excerpt :

      Escalating commitment has received a certain degree of attention in IT industry projects (Keil, 1995; Mähring and Keil, 2008), where it has been found to account for a high proportion of failed projects in terms of the inability to meet requirements in time, cost and scope. These are referred to as “runaway projects” (Sabherwal et al., 2003). The runaway tendencies found in IT can be assumed to apply to other industries as well.

    View all citing articles on Scopus

    Rajiv Sabherwal is the Emery C. Turner Professor of Information Systems at University of Missouri, St. Louis. Dr. Sabherwal’s research focuses on knowledge management, strategic management of IS, and social aspects of systems development. He has published on these topics in Information Systems Research, MIS Quarterly, Organization Science, California Management Review, Communications of the ACM, Journal of MIS, and several other journals. He is an Associate Editor for MIS Quarterly, and a member of the editorial boards of Journal of AIS and the IEEE Transactions on Engineering Management. He has a PhD in business administration from the University of Pittsburgh, and has earlier taught at Florida State and Florida International Universities.

    Maung K. Sein is Professor of IS at Agder University College, Norway. He conducts research in end-user training, human-computer interaction, conceptual database design, computer personnel, IS management and currently on IT and national development. He has published in Information Systems Research, MIS Quarterly, Communications of the ACM, and Human-computer Interaction and presented his research around the world. He has or is serving on editorial boards of MIS Quarterly, MIS Quarterly Executive, Communications of AIS, and E-Service Journal and guest-edited Communications of the ACM. He has chaired conferences and served on program committee of ICIS, ECIS and AMCIS. A PhD graduate from Indiana University, USA, he has served at Georgia State, Florida International, and Indiana Universities.

    George M. Marakas is an Associate Professor of Information Systems and the BAT Faculty Fellow in Global IT Strategy for the Kelley School of Business at Indiana University. Professor Marakas’ research has appeared in many prestigious academic journals including Information Systems Research, Management Science, International Journal of Human-Computer Studies, and the European Journal of Information Systems. In addition, Dr. Marakas is the author of three best selling textbooks in the field of information systems.

    View full text