In their book Billion Dollar Lessons, Carroll and Mui describe the most inexcusable business failures of the last twenty-five years.  One of the failures, “Staying the Course” poses particular difficulties for Risk Analysts.

The difficulty is three fold.  First, management believes if it stays the course everything will turn out fine.  Absent any significant data to the contrary, it is difficult to change managerial, let alone, institutional inertia.

Second, identifying a viable alternative against which to evaluate the impact of staying the course may be difficult because often the costs and benefits are not clear until years afterwards.

Finally, clients and customers are often psychologically and materially locked into the current strategy.  They, therefore, put pressure on the company and its board to stay the course. Continue reading →