QuestionQuestion

Prepare a paper that summarizes the Steinkuhler et. al. study and its findings. Include an explanation of the following phenomena described in the article: self-justification, selective perception, sunk cost effect, and over-optimism. Then, select one of these four phenomena and describe its applicability to a real management decision that you have encountered or that you find through additional research. The management decision selected must have an international dimension. In what ways does this decision affect the overall health of the organization, both locally and globally? If the decision led to poor results, what would you recommend for future decisions and why?

Support your paper with a minimum of three scholarly resources. In addition to these specified resources, other appropriate scholarly resources, including older articles, may be included.

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Escalation of commitment

Introduction
One of the most common projects behind project delays is that the decision-maker continues to invest in the project even though it may not be viable over the long term. Escalation commitment has been explained to result from the integration of several forces, one of which is self-justification. As managers feel that there is increased pressure on them to justify their actions, they continue to make investments in a non-profitable project so that they can avoid their association with a failed project. This report presents an analysis of the findings by Steinkuhler et al (2014) and their presence in real-life decision making.

Summary of article
Steinkuhler et al (2014) had conducted research on escalation commitment to identify the factors contributing to the same. Primary research had been conducted to assess the hypothesis. The study sought to test several hypotheses that identified relation between factors of selective perception, sunk cost effect, over optimism, self-justification on project escalation. As per the hypotheses, all these factors have positive and direct correlation with each other i.e. if one factor increases, the other also increases. In order to test the model, an online survey was conducted among European venture capital professionals. Both methods of literature review as well as drawing responses from email were used to...
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