Information Systems Project Continuation in Escalation Situations: A Real Options Model

@article{Tiwana2006InformationSP,
  title={Information Systems Project Continuation in Escalation Situations: A Real Options Model},
  author={Amrit Tiwana and Mark Keil and Robert G. Fichman},
  journal={Decision Sciences},
  year={2006},
  volume={37},
  pages={357-391}
}
Software project escalation has been shown to be a widespread phenomenon. With few exceptions, prior research has portrayed escalation as an irrational decision-making process whereby additional resources are plowed into a failing project. In this article, we examine the possibility that in some cases managers escalate their commitment not because they are acting irrationally, but rather as a rational response to real options that may be embedded in a project. A project embeds real options when… CONTINUE READING
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