ABSTRACT Project failure in the information technology area is a costly problem, and troubled projects are not uncommon. In many cases, these projects seem to take on a life of their own, continuing to absorb valuable resources, while failing to deliver any real business value. While prior research has shown that managers can easily become locked into a cycle of escalating commitment to a failing course of action, there has been comparatively little research on de-escalation, or the process of breaking such a cycle. Through de-escalation, troubled projects may be successfully turned around or sensibly abandoned. This study seeks to understand the process of de-escalation and to establish a model for turning around troubled projects that has both theoretical and practical significance. Through a longitudinal case study of the IT-based baggage handling system at Denver International Airport (DIA), we gathered qualitative data on the de-escalation of commitment to a failing course of action, allowing us to inductively develop a model of the de-escalation process as it unfolded at DIA. The model reveals de-escalation as a four-phase process: (1) problem recognition, (2) re-examination of prior course of action, (3) search for alternative course of action, and (4) implementing an exit strategy. For each phase of the model, we identified key activities that may enable de-escalation to move forward. Implications of this model for both research and practice are discussed.
