Change management: when should a project be stopped?
A change project commits budgets, time and the credibility of its advocates. The managerial question is precise: how can its continuation be assessed without allowing past investments to stand in for justification?
What the literature establishes
Barry M. Staw (1976, Organizational Behavior and Human Performance) experimentally studied resource allocation following negative feedback on a decision. In this setting, participants personally responsible for the initial decision committed more additional resources than those who were not responsible. This finding shows that responsibility for a choice can encourage its continuation rather than its reconsideration.
The weight of sunk costs
Hal R. Arkes and Catherine Blumer (1985, Organizational Behavior and Human Decision Processes) describe the sunk cost effect: having already invested money, time or effort can increase the tendency to continue. Their research highlights, among other things, the desire not to appear wasteful. In a transformation, defending the budget already spent can therefore replace an assessment of the benefits still attainable.
The premature conclusion
One might conclude that a disappointing project should be stopped quickly. This research does not support such a rule: sunk costs do not justify continuation, but expected benefits, future costs and the consequences of stopping remain relevant. A temporary difficulty is therefore not, on its own, a reason to abandon a project. (our executive and employee training programmes)
What the evidence cannot settle
These classic studies do not constitute an evaluation of transformations undertaken by organisations in Sion. They illuminate decision-making mechanisms without providing a universal threshold for terminating a project. In practice, the challenge also involves distinguishing a genuinely sunk expenditure from a commitment whose cancellation would entail further costs.
A practical check in Sion
Within SHR's change management programme, a proposed exercise in Sion can focus on a project connected with hydropower, healthcare, viticulture or Alpine tourism. Before its next review, record separately the sunk costs, the future costs of continuing or stopping, the benefits still expected and an explicit criterion for reconsideration. At the following review, measure the proportion of continuation decisions whose written record compares the options on the basis of their future consequences and checks the stated criterion. This proportion documents decision-making discipline, not the success of the change. To go further: explore the Change Leadership training in Sion in the canton of Valais, or browse our executive and employee training programmes in Switzerland.
In pictures: Change Leadership in Sion
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