Stopping a project: how the initial decision can bind a leader
Within SHR — Swiss Human Resources’ “Leadership d'excellence” programme, the ability to reassess one's own commitments deserves attention alongside the ability to mobilise others. The managerial question is specific: how can a leader decide whether to continue a disappointing project without treating responsibility for its launch as an argument in its favour?
What the literature establishes
Barry M. Staw (1976, Organizational Behavior and Human Performance) experimentally studied successive resource allocation decisions following unfavourable results. In this setting, participants responsible for the initial decision committed more additional resources than those who were not responsible for it. The finding highlights a risk of escalating commitment: defending a past decision can influence the next allocation.
The weight of what cannot be recovered
Hal R. Arkes and Catherine Blumer (1985, Organizational Behavior and Human Decision Processes) showed, across several decision settings, that previous investments could increase the propensity to continue. Their work links this effect in particular to the wish not to appear to waste resources already committed. Yet an irrecoverable expense does not, by itself, constitute an expected benefit of continuing.
The premature conclusion
One might conclude that a manager should abandon any project whose early results disappoint. That would confuse the influence of past costs with the value of future prospects: continuing may still be justified by expected benefits, exit costs or obligations that remain in force. The discipline lies in distinguishing these reasons from the argument that “we have already invested too much to stop”. (our executive and employee training programmes)
What the evidence cannot decide
These studies provide neither a universal threshold for abandonment nor an estimate directly transferable to organisations in Genève. Their designs do not reproduce the full complexity of the regulatory, contractual and political commitments surrounding an actual project. In practice, budget consumption and technical progress are therefore insufficient: the assumptions that still justify the remaining investment must also be examined.
A practical check in Genève
As a practical application of the programme in Genève, a private bank, an international organisation, a luxury watch manufacturer or a commodity trading firm can test the same rule: before a project's next funding allocation, record an observable condition for reassessment and discuss it with someone who was not involved in the initial decision and is authorised to access the file. Depending on the context, this condition might concern compliance approval, a donor commitment, industrial qualification or an exposure limit. At the next review, calculate the proportion of projects that met this condition for which a reasoned decision to continue, redirect or stop was recorded, separately identifying future benefits, remaining costs and exit costs. This ratio verifies whether a documented reassessment took place, not the economic quality of each decision or the causal effectiveness of the training. To go further: explore the Executive Leadership training in Geneva, or browse our executive and employee training programmes in Switzerland.
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