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Career Management: The Sunk-Cost Fallacy!

Career
Author : Dilip Saraf

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I dont know where were headed, but we are making good time! Yogi Bera

 

One of the constant themes I encounter in my coaching practice is when clients come to me after pursuing a path of promise and discovering that the path was illusory. At least, after repeated experiences of sameness, they want to know how long to keep doing what they started and how to move forward. Typical examples of these themes include repeated promises of promotions that do not come through; no change in their status after chasing new certifications to enhance their skills or rsum; pursuing a new degree to enhance their station, etc.

This blog is about the concept of how increasing your sunk costs delude you into continuing on that path, when you suspect that the path is illusory. I am writing this blog to remind readers to alert themselves of this fallacy and to do something that will help them get back on track to meet their stated objectives.

Promotion promise: Most employees are looking for promotion after a few years in their role. They work hard and convince themselves by looking around that if Joe was promoted last year, after just doing little to deserve it I certainly deserve more than he did, since I work much harder and my contributions are much more valuable to the group. So, you march into your bosss office and ask him for what the timeline is for your next promotion. The boss reclines in his chair, throws his feet on the desk in front of him, folds his hands behind his head, and with a show of some ersatz concern on his face goes, Hmmm, lets see now: I just promoted Joe last year, so, for me to promote another team member in my group Ill have to wait two years OR have that person contribute something exceptional in this group so all my higher ups notice it. He pauses, scratching his chin, with a quizzicaleven enlightenedlook on his face prompting you to say something.

You jump in and volunteer for that long-pending infrastructure initiative that no one had time to work on. You say, OK, Ill give you my plan for that infrastructure project that never got off the ground and Ill complete that on my own time and you can use that as a proof point of my initiative and leadership contribution to put my promotion through, when the project is complete.

He now smiles and agrees for you to work on it with his full support. For the next 6-9 months you toil 16-hour days doing two jobs: pulling your regular duties and the new infrastructure project that you underestimated in its scope. Two moths before the next review cycle you complete the project, and everyone congratulates your boss for his heroism and leadership for coming through. He gets immediately promoted to Senior Director and is assigned to a larger organization, and you get a new boss from the outside. When you tell your new boss the history of this infrastructure project and what your just-promoted boss had promised you, he promptly responds, that infrastructure project is no longer my priority; I have other fish to fry. Let me get settled and get back to you!

You patiently wait and a few months later a new initiative is pushed down the organization to cut costs and head count. Your new boss reminds you that you are lucky that you were not on that RIF list. You breathe a sigh of relief.

Now you try to ingratiate yourself with your new boss and find yet another project to volunteer for the next round of APR with a hope for your promotion. You hunker down and start your 16-hour-day routine all over again. You reason that you have already figured out how to get these projects done (and help your boss get to their next level!), so you figure the next time is the charm, so you mislead yourself all over again. This is the sink-cost fallacy getting the best of you!

What you should do, instead: As soon as the old boss got promoted on the backs of your toil and success, you must update your rsum, showcase your leadership in getting things done that were outside your responsibility and market yourself at the next level in the open market.

Pursuing a new degree: B-schools often lure Mid-career professionals in pursuing an MBA degree to advance their careers. Most B-schools do such a good job of marketing their MBA degrees and summer programs that most see that as their ticket to top management positions. Although an MBA can be a helpful addition to ones rsum, often it is not a requirement for advancement in all cases. This is especially true in technology where most engineers and scientists are under the misguided notion that adding MBA to their educational credentials will open new doors for them for executive roles. Spending two or so years and budgeting your own savings (sometimes a few hundred thousand dollars even borrowed on student loan programs) to pursue a questionable degree is worth some serious thought.

Instead, showing leadership initiative at your current role, taking some meaningful business courses (finance, marketing, management) on line, and applying what you learn in these courses to advance your station and to build your rsum with specific accomplishments that show your leadership is a more effective way to go in the direction you desire. I am not advocating not going after business courses or even an MBA, but if your company deems that as a way for you to advance your skills and sponsors you to pursue such a degree without your putting out your own monies, then it is something worthwhile for you to pursue, because now your company is on the hook for doing something with you after your degree.

Taking selected courses, applying the knowledge to work differently in your current job, building your rsum with that message is a far more effective way to migrate to management ranks than blindly pursuing an MBA and realizing that it did not make any difference in your career.

Boondoggle projects: Many companies launch new projects with great fanfare. Even CEOs take special interest in such projects when someone has done a good job selling such ideas to top executives. Initially, star players are selected to chase such projects, but as things change new projects take their place, with the original team continuing its work as people become aware of their sunk costs and the burn rate. Someone needs to take charge of such boondoggles and cut the losses before wholesale cost cutting initiatives come down from the top. So, if you are involved in a project that has now become marginally useful or even sidelined, save your job and your career by proposing deep sixing such projects and getting on some more rsum-building tasks!

Sunk cost fallacy is a real threat to many careers and one must recognize their impact. If you are chasing such a fallacy to advance your own career become aware of what is going on and take some action to protect and save your career. Do it now!

Good luck!


About Author
Dilip has distinguished himself as LinkedIn’s #1 career coach from among a global pool of over 1,000 peers ever since LinkedIn started ranking them professionally (LinkedIn selected 23 categories of professionals for this ranking and published this ranking from 2006 until 2012). Having worked with over 6,000 clients from all walks of professions and having worked with nearly the entire spectrum of age groups—from high-school graduates about to enter college to those in their 70s, not knowing what to do with their retirement—Dilip has developed a unique approach to bringing meaning to their professional and personal lives. Dilip’s professional success lies in his ability to codify what he has learned in his own varied life (he has changed careers four times and is currently in his fifth) and from those of his clients, and to apply the essence of that learning to each coaching situation.

After getting his B.Tech. (Honors) from IIT-Bombay and Master’s in electrical engineering(MSEE) from Stanford University, Dilip worked at various organizations, starting as an individual contributor and then progressing to head an engineering organization of a division of a high-tech company, with $2B in sales, in California’s Silicon Valley. His current interest in coaching resulted from his career experiences spanning nearly four decades, at four very diverse organizations–and industries, including a major conglomerate in India, and from what it takes to re-invent oneself time and again, especially after a lay-off and with constraints that are beyond your control.

During the 45-plus years since his graduation, Dilip has reinvented himself time and again to explore new career horizons. When he left the corporate world, as head of engineering of a technology company, he started his own technology consulting business, helping high-tech and biotech companies streamline their product development processes. Dilip’s third career was working as a marketing consultant helping Fortune-500 companies dramatically improve their sales, based on a novel concept. It is during this work that Dilip realized that the greatest challenge most corporations face is available leadership resources and effectiveness; too many followers looking up to rudderless leadership.

Dilip then decided to work with corporations helping them understand the leadership process and how to increase leadership effectiveness at every level. Soon afterwards, when the job-market tanked in Silicon Valley in 2001, Dilip changed his career track yet again and decided to work initially with many high-tech refugees, who wanted expert guidance in their reinvention and reemployment. Quickly, Dilip expanded his practice to help professionals from all walks of life.

Now in his fifth career, Dilip works with professionals in the Silicon Valley and around the world helping with reinvention to get their dream jobs or vocations. As a career counselor and life coach, Dilip’s focus has been career transitions for professionals at all levels and engaging them in a purposeful pursuit. Working with them, he has developed many groundbreaking approaches to career transition that are now published in five books, his weekly blogs, and hundreds of articles. He has worked with those looking for a change in their careers–re-invention–and jobs at levels ranging from CEOs to hospital orderlies. He has developed numerous seminars and workshops to complement his individual coaching for helping others with making career and life transitions.

Dilip’s central theme in his practice is to help clients discover their latent genius and then build a value proposition around it to articulate a strong verbal brand.

Throughout this journey, Dilip has come up with many groundbreaking practices such as an Inductive Résumé and the Genius Extraction Tool. Dilip owns two patents, has two publications in the Harvard Business Review and has led a CEO roundtable for Chief Executive on Customer Loyalty. Both Amazon and B&N list numerous reviews on his five books. Dilip is also listed in Who’s Who, has appeared several times on CNN Headline News/Comcast Local Edition, as well as in the San Francisco Chronicle in its career columns. Dilip is a contributing writer to several publications. Dilip is a sought-after speaker at public and private forums on jobs, careers, leadership challenges, and how to be an effective leader.


Website: https://dilipsaraf.com/career-management-the-sunk-cost-fallacy/

 

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