The effects of self-efficacy, process feedback, and task complexity on escalation of commitment in new product development

Abstract

Purpose

The purpose of this paper is to investigate the effects of self-efficacy, process feedback and task complexity on decisions by managers to continue or discontinue a new product after receiving negative performance feedback.

Design/methodology/approach

This paper uses a classroom experiment design and uses logistic regression and a chi-square test to analyze the data.

Findings

The findings of this paper show that self-efficacy, process feedback and task complexity have not only main effects but also interactive effects on managers’ go or no-go decisions; further, the main effects are mediated by interactions. The effect of self-efficacy is moderated by process feedback and task complexity. Process feedback and task complexity also have an interactive effect on decisions about new products by decision-makers.

Research limitations/implications

This paper extends the theory of escalation of commitment (EOC) by showing that self-efficacy, process feedback and task complexity can influence decision-makers’ go or no-go decisions after they have received negative performance feedback.

Practical implications

This paper provides useful guidelines for managers on how to reduce the likelihood of EOC.

Originality/value

The originality and value of this paper lie in its being the first to examine the effects of process feedback and task complexity on the EOC.

Citation

Liang, B. (2019), "The effects of self-efficacy, process feedback, and task complexity on escalation of commitment in new product development", Journal of Business & Industrial Marketing, Vol. 34 No. 8, pp. 1641-1653. https://doi.org/10.1108/JBIM-02-2019-0096