What do you do when you've invested good time, money and energy into a project, relationship or strategy that isn't working — and you're not sure if you should keep investing, or let it go?
There’s a concept I learned about in business school called “the fallacy of sunk costs.” For most of us, once we give time, money or energy to something, we tend to keep investing those resources, even if what we’re investing in clearly isn’t working out.
The conversation we have with ourselves often goes something like this: “Well, I’ve already put a $50,000 dollars into this project so if I walk away now, I’ve lost that money.” We think of that $50,000 as sitting in a safe location somewhere when the truth is, that money is gone. It’s sunk into the project. Instead of thinking about what you've already invested, ask yourself, “If I were to start this project over from scratch, would it be worth the additional resources necessary to move it forward?” If the answer is no, then it's better to walk away.
You can apply this lesson to any relationship, project, or experience you’ve invested in over the last twelve months. Ask yourself if it makes sense to continue investing given everything you now know. Is the project in alignment with your values? Are the people you’re working with engines or anchors? Is the experience promoting expansion and growth, or holding you back?
It can be a challenge to own up to what’s not working and let it go, but when you do, you open up time and space for new opportunities, ones you may not even be aware of yet!