Members of the ill-fated Everest expedition invested upwards of $65k each. They spent weeks hiking to reach the final base camp before their ultimate eighteen-hour push to the summit. There is an unwritten rule that if you have not made the summit by two o’clock in the afternoon of the final push, you should turn back.
The two expeditions were about 300 feet from the summit at 2:00, but since the climbers had invested all that money, time, and effort to get to this point they ignored the rule. They continued the push towards the summit. This poor decision cost the lives of many of the expedition members, including the two guides. Some ran out of oxygen on the descent. Some froze to death before making it back to base camp.
The sunk cost bias caused the expedition members to go beyond the established abort time. Being so close to their goal, after having invested so much, they felt they could not give up. They made the bad decision to continue because of their sunk cost bias. Some businesses invest heavily in a new product or service, only to discover that the landscape has changed by the time they are ready to launch. Rather than abandon the idea in the eleventh hour, they continue to pour more time and money into promoting the program or idea, only to lose even more time and money.
