ANATOMY OF A DECISION TRAP IN COMPLEX NEW PRODUCT DEVELOPMENT PROJECTS

We conducted a longitudinal process study of one firm's failed attempt to develop a new product. Our extensive data analysis suggests that teams in complex dynamic environments characterized by delays are subject to multiple "information filters" that blur their perception of actual project performance. Consequently, teams do not realize their projects are in trouble and repeatedly fall into a "decision trap" in which they stretch current project stages at the expense of future stages. This slowly and gradually reduces the likelihood of project success. However, because of the information filters, teams fail to notice what is happening until it is too late.