4 ms·
Fighting the Concorde effect
- rdl 16y agoWhile treating sunk costs as sunk is good, it's also important to avoid futile thrashing between alternatives, and to recognize that you have imperfect information at all times. There are times where it makes sense to continue to solve a problem the same way, vs. switching to a newer and better solution as soon as it is epsilon better. (generally, people have a lot bigger problem with treating sunk costs as sunk, but there are cases where they thrash back and forth and end up completing neither)
- rjprins 16y agoYes, from the perspective of imperfect information you could (maybe even should) view the development of a feature as research for the question: "Can it be done and for how much?". This way the sunk costs are just research costs, which makes the decision to stop much easier to accept.
- rdl 16y agoEven more core, it is "will users pay me/appreciate/etc. if we offer this feature." You can simulate features in a high-per-transaction-cost manual way for a while, just to see if people actually like it, before even developing it.
- dalore 16y agoThis same effect explains why people hold onto losing stocks/shares.