The Real Problem Leaders Underestimate: Continuation Bias

Once an initiative has a sponsor, a budget line, and a steering committee, continuation becomes the path of least resistance. Behavioral research describes this pattern as escalation of commitment—doubling down on a course of action even when evidence weakens, often reinforced by sunk-cost logic, identity, and social dynamics.

In transformation portfolios, continuation bias shows up as:

• Pilot purgatory: initiatives keep “learning” but never reach decisions.
• Sunk-cost momentum: prior spend becomes the justification for more spend.
• Talent lock-in: scarce doers are trapped in underperforming work while higher-value bets starve.
• Opportunity cost blindness: boards review milestones, but don’t see what can’t start because capacity is clogged.
• If governance forums are designed only to approve and oversee, they will produce more work. If governance is designed to prune and reallocate, it produces speed.

A Practical Model: The PSS Matrix (Pivot–Sunset–Stop)

To keep a portfolio healthy, every underperforming initiative needs an “exit door” that is socially acceptable and operationally clean. The PSS Matrix gives leaders three disciplined moves—based on signals, not narratives:

1) PIVOT — The problem is valid; the approach is wrong.

• Redesign scope, simplify the delivery model, or change the mechanism (e.g., from big-bang to staged releases).
• Preserve the value hypothesis, change the path.

2) SUNSET — Value is realized; maintenance is now the risk.

• Shift from “build” to “run,” with clear ownership and controls.
• Capture the workflow, controls, and handover requirements so benefits don’t decay.

3) STOP — The context shifted or evidence is negative.

• Terminate funding, archive learning, and reassign talent quickly—before the work goes “off-book.”

McKinsey’s guidance on proactively pruning projects reinforces the logic: organizations often hold on too long, and disciplined mechanisms help leaders decide when to let go.

What Good Looks Like

When “strategic exit” becomes a normal operating discipline, you see observable changes:

• From pet projects → portfolio bets: every initiative has explicit exit criteria at kickoff.
• From status reporting → signal validation: reviews focus on evidence-to-effort, not dashboard aesthetics.
• From stigma → stewardship: stopping is treated as capital discipline, not personal failure.
• From delayed reallocation → fast redeploy: talent moves in days, not quarters.

How to Execute: Six Steps to Institutionalize “Scale-or-Kill”

1) Define exit criteria at kickoff
    • Objective: prevent “success drift.”
    • Output: pivot/sunset/stop triggers written into the charter.

2) Separate advocacy from decision-making
    • Objective: reduce sponsor bias.
    • Output: an independent gate chair for continue/stop forums (a practice aligned with anti-escalation guidance).

3) Run quarterly Scale-or-Kill gates
    • Objective: make pruning routine, not heroic.
    • Output: a ranked portfolio view where the bottom slice must justify continuation.

4) Require one-page decision notes for extensions
    • Objective: make judgment auditable.
    • Output: decision, evidence, risks, next tranche, and the “kill conditions.”

5) Enforce closure packs for every stop/sunset
    • Objective: preserve institutional memory and protect realized benefits.
    • Output: benefit register, lessons learned, ownership handover—aligned with benefits realization practices.

6) Reallocate talent centrally, fast
    • Objective: convert decisions into throughput.
    • Output: redeployment within a defined window (e.g., one week), so stopped work truly frees capacity.

Risks and Trade-offs

• Fear culture: if exits feel punitive, teams hide bad signals. Mitigate by rewarding clean stops and learning discipline.
• Over-pruning: cutting too aggressively can create whiplash. Mitigate by using Pivot before Stop when the problem remains     strategic.
• Shadow continuations: work persists unofficially. Mitigate by enforcing that only logged initiatives receive funding and     capacity.

Leadership Questions

• If we reset the budget to zero tomorrow, which three initiatives would we re-fund first—and why?
• What percentage of our portfolio is alive because of sponsorship strength rather than evidence strength?
• How long does it take for a stop decision to become real capacity in the business?
• Do we treat stopping as stewardship—or as embarrassment?

Definitions

• Continuation bias: the tendency to keep an initiative going because it already exists, not because it still merits investment.
• Zombie initiative: a project that consumes capacity without credible evidence of value.
• Scale-or-Kill gate: a recurring decision point where an initiative must earn continuation through signals tied to outcomes.