Why We Fear Cutting Our Losses and Doing Something Different
Leadership demands our time, energy, and often our financial resources. Hopefully the projects and people we invest ourselves in are worthwhile and fulfilling. Often we invest so much of ‘us’ into a project that we can’t imagine not finishing the project. When we’ve already invested considerable time and energy into something, stopping it may seem foolish. Unfortunately, we seldom ask ourselves if we really should continue investing in a project. A subtle mental trap comes into play called the sunk cost bias. Sunk cost bias simply means that because you’ve invested so much emotionally into a project, you feel that by quitting you’d waste what you’ve already invested and be a failure, even though you actually should cut your losses and re-direct your efforts. Consider five these signs that the sunk cost bias might be driving some of your leadership decisions.
- You have a nagging sense that you probably need to go another direction. Perhaps you’ve gotten new information or the landscape has changed and you have begun to doubt if you should continue in the current direction. And, you can’t seem to shake those doubts.
- You want things to change in your ministry or church, but you keep doing the same things over and over again, expecting to get different results. Einstein defined this as insanity.
- You know you should stop the project but fear having to explain yourself to others.
- You’ve poured so much into this project that that your emotional attachment has made you lose sight of your greater goals and vision.
- The project drains your energy rather than boosting it.
If any of these five signs are true of you, the sunk cost bias may be distorting your judgment. Consider taking these steps to evaluate whether or not you should cut your losses on some project and go a different direction.
- Talk to someone about your struggle who will maintain their objectivity and be honest with you.
- Play out the scenario if you did stop. What benefits would you gain? Would new costs would you incur? What more productive project could you then invest your time and energy into?
- Were you to stop, who would you need to explain your decision to? How would you explain your decision? Might they actually respect you for making such a decision?
- Re-visit your values. Does the project align with your personal and ministry values and God’s call on your life?
How have you seen the sunk cost bias play out in your life or other people’s lives?