The article examines the escalation of commitment to failing strategies from a psychodynamic perspective as an affective process connecting organizational, systemic and individual levels. We propose a theory of organizational blind spots to explain how such escalation of commitment occurs. Blind spots develop as an organizational defence mechanism for coping with problems resulting from attempts to implement unrealistic strategy or policy goals. Unrealistic strategic aims mobilize and reinforce blind spots through processes of splitting, blame and idealization, thus enabling organizations to persist with unsuccessful courses of action. Organizational blind spots arise when leadership and/or operational members in organizations are unable to acknowledge unworkable strategies. Vignettes from the National Health Service in England (the NHS) are used to illustrate how blind spots sustain an illusory possibility of success while commitment to a failing strategy escalates. The theory of blind spots offers a novel social-psychological approach to understanding how these dysfunctions of strategy develop and become institutionalized, putting organizations in jeopardy and threatening their survival.
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