Thy love is false; thy star hath sunk; virtue is a mockery!
From The Temptations of Hafiz (1845)
You have perhaps heard of sunk cost. The sunk cost fallacy is the belief that because you have already invested money or resources in an idea, product, or service, you must not abandon that idea, product, or service even if it no longer works for you. It is more a matter of emotion than thought.
The business world is rife with illogical sunk-cost thinking, which is why you see a company continuing to struggle with failed hardware instead of abandoning it and starting anew. We are all subject to the fallacy. It’s why I won’t get rid of my expensive new sneakers even though they are killing my feet. I have worked for colleges where they would not abandon utterly inadequate data management systems simply because they had spent so much on them. I am sure you have had similar experiences.
The sunk cost fallacy assumes that because something warranted a significant financial investment in the past, it is too valuable to do away with no matter the evidence.
Similarly, what I call the sunk virtue fallacy assumes that because a significant investment of effort in the past was effective, it is too valuable to do away with, no matter the evidence. Clinging to sunk virtue can be like clinging to a half-wrecked boat. You are lucky to keep your head above water.
Virtue Sunk: An Unreal Tale
Once upon a time, there was a princess, named Princess Buttertub, who inherited her kingdom only to discover a destructive force that threatened its very existence. Her new kingdom was deep into budgetary trouble, which would require extraordinary intervention if the princess were to save her land. She had to act quickly and decisively to save the day, so Princess Buttertub gathered her closest noble lieutenants, and they plotted drastic moves to fix their financial problems.
Some of their solutions centered on significantly increasing the workload of their subjects. Others had to do with cutting expenses alongside extreme tactics to immediately increase revenue, such as exorbitant taxes on the serfs. Princess Buttertub, in an uncustomary act of selflessness, even reduced her own fortune to a level she thought the kingdom could sustain. The situation was that bad. In short, she and her team of nobles did what had to be done no matter what. Their personal sacrifice was great, almost heroic, but what they asked of others was as great or even greater.
Eventually their efforts were successful, and the members of the Royal Court showered them with gratitude and praise.
Years went by. Princess Buttertub’s team of noble lieutenants that had saved the day was still intact. Unaccountably, the emergency decrees and practices that were implemented to offset the financial shortfall were also still intact. The workloads and taxes imposed on their subjects remained unconscionably high. Some of the most draconian emergency cost-cutting and egregious revenue-generating practices remained in place. The stated thinking was that since these practices had been critical during a crisis, discontinuing them could be risky. Soon, these directives became law in all but name.
Meanwhile, the kingdom had stagnated. Buildings crumbled and projects were left unfinished. Even the Royal Palace, Princess Butterctub’s own abode, had sewage in its basement and chickens running wild in its backyard.
Sure there were some years that the kingdom thrived more than others, but its condition contracted and expanded within the confines of hardened parameters, never to do much worse or better than it had already done. A scarcity mindset pervaded everything. Chronic problems were allowed to continuously suck up time, energy, and money in lieu of investing resources to address them. The only qualities in abundance among the princess and her leadership were low expectations and an inferiority complex.
Any attempts by newcomers to unravel the emergency policies were met with open hostility, even viciousness, which should not be surprising. After all, the storied team that saved the kingdom now drew much of their authority and power from continuing those very policies and practices that had seemed so virtuous and heroic in the past.
Meanwhile, Princess Buttertub nurtured and protected her noble lieutenants like a mama bear. She did not care that — as with her — virtually all their goodness, all their virtue, had been spent years before never to be replenished. They remained noble in title but not in person.
Moreover, the Royal Court also fell for the sunk virtue fallacy. They continued to reward the princess for her fortitude in the face of crisis even though the kingdom itself had long since become mired in mediocrity. She had saved the kingdom only to have it subsist like a comatose patient.
Sadly, the kingdom’s many strengths and resources were squandered as Princess Buttertub and her lieutenants jealously guarded the status quo and the benefits it conferred upon them. Some simple fixes for major problems were readily at hand so long as the Royal Court, the princess, and her noble lieutenants were willing to risk letting go of their emergency policies, so long as they were willing to admit that their past heroics were not a guarantee of present virtue. They refused to accept that the very practices that had once saved the kingdom were now the source of its sinking fortunes.
And they all lived miserably ever after.
We often make the same mistake in our daily decisions. Not only do we hang onto poor investments because of sunk costs, we assume that past virtue inevitably leads to future success. While someone’s past actions can be a strong indicator of their future behavior, it is far from a reliable predictor.
B.J. Fogg, the behavioral scientist behind Tiny Habits and a budding revolution in our understanding of the ability to change for the better, has found that behavior consists of three elements: motivation, ability, and a prompt. Without the presence of all three factors, we simply don’t act.
Our Princess Butterctub’s most virtuous behavior was prompted by an emergency that she inherited upon taking charge of her kingdom. She and her noble team’s ability to address that emergency was limited, but their motivation — existential fear — was high enough to offset their inability, which allowed them to plow ahead. Later when their many efforts paid off and the emergency had passed, the prompt to action morphed into stagnation. The need to make drastic alterations was replaced by a fierce unwillingness to let go of the status quo.
To be sure, as with the initial change, her noble lieutenants’ ability to maintain the status quo over time was low. One secret they don’t tell you in school is that maintaining the status quo can be tremendously hard and risky in the long run. Treading water at first is easy, but over an extended period it is exhausting and invites sharks. To offset that difficulty, though, the noble team’s motivation to continue as is remained high because they now enjoyed the dominance the status quo conferred, which they feared losing. Thus, even though their ability to stay put was diminishingly scarce, their motivation to do nothing was sky high.
The sunk virtue fallacy can blind us to the truth that present circumstances reveal. It can affect our business decisions and our personal relationships.
The next time you need to make a decision about a person or action based solely on their past, consider the factors that marked that past. Do they exist now? Are they likely to exist in the future? If not, then beware of clinging to the fallacy of sunk virtue.
What sunk virtues do you cling to? What past efforts now threaten to sink you and your organization?
You can let go of past efforts, even once-effective ones, that no longer serve, and I can help. Click below for your free consultation.
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