An Examination of the Deaf Effect Response to Bad News Reporting in Information Systems Projects

Information systems project management has historically been a problematic area. One of the reasons for this has been the issue of escalation where resources continue to be committed to a failing course of action. While many causes of escalation have been proposed, this dissertation investigates one possible cause: that the project manager may not hear, ignores or overrules a report of bad news to continue a failing course of action: the Deaf Effect response to bad news reporting. This effect has not been previously studied within the information systems literature. In this dissertation, the Deaf Effect is examined through a series of three laboratory experiments and a case study. It finds that in a conducive environment, where the bad news reporter is not seen as credible, and the risk of project failure is seen as low, decision makers tend to view the report of bad news as irrelevant and thus ignore or overrule the report of bad news and continue the current course of action. Role Prescription of the bad news reporter, illusion of control and a perception of a highly politicized environment are factors that also increase the occurrence of the Deaf Effect.