Deviation and escalation: decision‐making pitfalls illustrated

Deviation and escalation: decision‐making pitfalls illustrated Purpose – It seems that the only constant of this rapid‐changing world is the “change” itself – whether it is from the organization itself or from its outer environment. From multinational corporation managers to local franchise investors, abilities to cope with changes are definitely essential. The purpose of this paper is to provide no magic but a framework that helps decision makers watch their steps while making strategic plans. Design/methodology/approach – Working from the perspective of the resource‐based view (RBV) for sustained competitive advantage, the paper looks into the decision‐making process by considering constraints and illusions. The journey of deviation from the ideal goal starts when the decision maker is attracted by a maze of illusions. The paper illustrates the phenomena of escalation of commitment in static and in deterioration‐in‐motion. Findings – For the recovery from an errant path, awareness is of the essence and a constant awareness of the organization's chances and pitfalls would be the only way to regain competitive advantage. Originality/value – By bringing together the concept of the RBV of competitive advantages and the phenomena of escalation of commitment, the paper provides a concise framework and illustration that is easy to be reminded of for organization decision makers who are constantly facing challenges in this ever‐changing world. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Organizational Change Management Emerald Publishing

Deviation and escalation: decision‐making pitfalls illustrated

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Publisher
Emerald Publishing
Copyright
Copyright © 2011 Emerald Group Publishing Limited. All rights reserved.
ISSN
0953-4814
DOI
10.1108/09534811111158930
Publisher site
See Article on Publisher Site

Abstract

Purpose – It seems that the only constant of this rapid‐changing world is the “change” itself – whether it is from the organization itself or from its outer environment. From multinational corporation managers to local franchise investors, abilities to cope with changes are definitely essential. The purpose of this paper is to provide no magic but a framework that helps decision makers watch their steps while making strategic plans. Design/methodology/approach – Working from the perspective of the resource‐based view (RBV) for sustained competitive advantage, the paper looks into the decision‐making process by considering constraints and illusions. The journey of deviation from the ideal goal starts when the decision maker is attracted by a maze of illusions. The paper illustrates the phenomena of escalation of commitment in static and in deterioration‐in‐motion. Findings – For the recovery from an errant path, awareness is of the essence and a constant awareness of the organization's chances and pitfalls would be the only way to regain competitive advantage. Originality/value – By bringing together the concept of the RBV of competitive advantages and the phenomena of escalation of commitment, the paper provides a concise framework and illustration that is easy to be reminded of for organization decision makers who are constantly facing challenges in this ever‐changing world.

Journal

Journal of Organizational Change ManagementEmerald Publishing

Published: Aug 30, 2011

Keywords: Decision making; Escalation of commitment; Resource‐based view; Change management; Planning; Competitive strategy

References

  • Strategic assets and organizational rent
    Amit, R.; Schoemaker, P.J.H.
  • Trustworthiness as a source of competitive advantage
    Barney, J.B.; Hansen, M.H.
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    Brush, T.H.; Artz, K.W.
  • Toward a knowledge‐based theory of the firm
    Grant, R.M.
  • Related diversification, core competence and corporate performance
    Markides, C.; Williamson, P.J.
  • Managerial prescriptions under the resource‐based view of strategy: the example of motivational techniques
    Mosakowski, E.
  • Sustainable competitive advantage combining institutional and resource‐based views
    Oliver, C.
  • Escalation of commitment during new product development
    Schmidt, J.B.; Calantone, R.J.
  • Dynamic capabilities and strategic management
    Teece, D.; Pisano, G.; Shuen, A.
  • When success breeds failure: the role of self‐efficacy in escalating commitment to a losing course of action
    Whyte, G.; Saks, A.M.; Hook, S.

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