Eliëns et al. (2018): Rational versus intuitive gatekeeping: escalation of commitment in the front end of NPD
17 important questions on Eliëns et al. (2018): Rational versus intuitive gatekeeping: escalation of commitment in the front end of NPD
What is investigated in the paper by Eliëns et al. (2018)? And Why?
- This study investigates if a gatekeeper’s thinking style - whether they think rationally or whether they follow their intuition - can prevent escalation of commitment in the front end.
- Theory on cognition provides arguments for and against either thinking style’s influence on escalation of commitment, but empirical evidence on this matter is lacking.
What is meant by escalation of commitment? And why is this likely to occur in the front end of NPD?
- Escalation of commitment is when a gatekeeper is unwilling to let go of a fruitless (nutteloos) NPD project. This waste valuable resources and hampers NPD performance.
- This is likely to occur already in the front end of NPD, where high ambiguity and complexity make it hard to distinguish fruitless from potentially successful projects.
Which three practitioner points are mentioned?
- Already in the front end of NPD, gatekeepers are vulnerable to escalation of commitment to an NPD project.
- A gatekeeper’s rational thinking style improves decision making at the last front end gate, as it reduces escalation of commitment.
- Careful selection and guidance of gatekeepers can enhance the use of a more rational thinking style when making decisions at the last front end gate
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What are decision gates and gatekeepers?
- Decision gates represent the moment the NPD project is evaluated, the decision whether to go on or stop the project is be made then.
- These decisions are made by the gatekeepers. These are typically experienced managers with authority over the organization’s resources, they finance and oversee an NPD project (but are not involved in decisions about the project’s execution).
The majority of best practice firms use which type/model of development process? And how does it work?
Which two hypotheses are formulated in the paper by Eliëns et al. (2018)? And which one is supported?
- H1: Gatekeepers who adopt a rational thinking style when making gate decisions in the front end of NPD show less escalation of commitment than those who adopt an intuitive thinking style
- H2: Gatekeepers who adopt an intuitive thinking style when making gate decisions in the front end of NPD show less escalation of commitment than those who adopt a rational thinking style
H1 is supported.
Which aspects of the NPD process are part of the front end?
starts.
How can the result ''rational gatekeepers are significantly less likely to escalate their commitment than intuitive gatekeepers at the final gate of the front end of NPD'' be explained?
- Rational thinking allows for more systematic reasoning and puts the emphasis on the right information during gate decision making
- Being aware of the decision process, being able to follow decision rules that relate to gate criteria, and being in control of one’s own emotions toward the project, thus also help reduce the likelihood of gatekeepers getting wrongly committed
Which two go/stop decision gates can be distinguished within the front end? And what do they entail?
- Idea gate
- A decision is made whether to allocate resources to the advancement of a new product idea
- Concept gate
- A decision is made whether to actually develop the defined new product concept and to commit significant resources for its development
- The onset of gatekeeper escalation of commitment is expected to occur at the concept gate
Result: Are the advantages of intuitive decision making useful in preventing escalation of commitment at the final gate of the front end of NPD? And why (not)?
- Gatekeepers are unable to emotionally detach themselves from the project
- Negative emotions such as anticipated regret and fear of decision consequences can lead to wrongful weighing of information and, consequently, poor decision making
Which two go/stop decision gates can be distinguished within the front end? And what do they entail?
- Idea gate
- A decision is made whether to allocate resources to the advancement of a new product idea
- Concept gate
- A decision is made whether to actually develop the defined new product concept and to commit significant resources for its development
- The onset of gatekeeper escalation of commitment is expected to occur at the concept gate
What is one of the main initiators of escalation of comitment? And Why?
- Project uncertainty
- This is higher in the front end compared to other phases in the NDP process. Gatekeepers are therefore more likely to ignore conflicting uncertain negative information
Result: What is an important reason why intuition might lead to more escalation of commitment of gatekeepers?
Which research method was used to test the hypotheses?
- Centered on the development of a new hybrid jet-engine in the aviation industry. This niche industry was chosen to suppress effects of industry-specific knowledge
What are 3 managerial implications?
- Firms can select gatekeepers with a disposition (aanleg) toward rationality, and/or train them in using a rational style
- Firms could reinforce rationality at the final front end gate through guidelines and rules of order
- Firms could establish a list of standard gate criteria and use scorecards or thresholds per criterion that need to be met by every NPD project to pass the gate
By which two theories can the escalation behavior of NPD gatekeepers be best explained? And what do these theories entail?
- Belief inertia distortion
- Refers to gatekeepers’ prior beliefs and current beliefs about the potential of an NPD project
- Self-justification
- When a person's behavior is inconsistent with their beliefs and that person tends to justify the behavior and deny any negative feedback
Result: Are the advantages or disadvantages of using a conscious rational thinking syle more important?
- This supports the general notion in NPD to apply formal processes and explicit rules in gate decision making and in the front end
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