In Lugano, is knowing when to stop a project a leadership skill?
Within SHR — Swiss Human Resources' “Leadership d'excellence” programme, the ability to reconsider one's own decisions deserves as much attention as the ability to mobilise a team. The specific question is this: how can managers avoid continuing a project primarily because they chose it and have already committed resources to it?
What the literature establishes
Barry Staw (1976, Organizational Behavior and Human Performance) demonstrated experimentally that responsibility for an initial decision can encourage further resource commitments when outcomes become unfavourable. In the setting studied, having personally chosen the investment changes the response to a setback. The managerial risk is therefore not simply misinterpreting results, but defending a decision for which one feels personally responsible.
The weight of costs already incurred
Hal Arkes and Catherine Blumer (1985, Organizational Behavior and Human Decision Processes) show that past investments of money, effort or time can influence the decision to continue an activity. Their work links this effect in particular to the desire not to appear wasteful. Yet an irrecoverable expense is not, in itself, a future benefit: justifying it does not establish the value of the next expenditure.
The premature conclusion
One might conclude that good leaders quickly abandon disappointing projects. That would confuse a decision bias with a profitability criterion: continuing can remain reasonable if future prospects justify it. The challenge is to distinguish forward-looking reasons from arguments that merely seek to make the past acceptable. (our executive and employee training programmes)
What these findings cannot decide
These studies provide neither a universal stopping threshold nor an estimate directly transferable to businesses in Lugano. Experimental settings simplify contractual obligations, interdependencies between projects and the human consequences of withdrawal. In practice, having someone else review the case may provide a useful counterpoint, but these two articles alone cannot guarantee that this arrangement will be effective.
A practical check in Lugano
As an application exercise within the programme, a team could spend four weeks reviewing every decision to provide additional funding to a struggling project: a banking tool, a fashion collection, a trading transaction or an investment by an Italian-speaking family SME. Before the decision, a record written in the working language, including Italian where appropriate, would distinguish irrecoverable costs, expected future costs and benefits, and an explicit criterion for reassessment. The indicator would be the proportion of reviewed decisions for which this record was complete and dated before approval or rejection, verifiable in the decision log. This measure would document decision-making discipline, not a demonstrated improvement in profitability. To go further: explore the Executive Leadership training in Lugano in the canton of Ticino, or browse our executive and employee training programmes in Switzerland.
In pictures: Executive Leadership in Lugano
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