ESCALATION OF COMMITMENT AND BANKRUPTCY
Polaroid Corporation is an international company based on America. It was found by Land Edwin H, in the year 1937. It manufactures electronics and eyewear. It is famous for the production of instant film camera .This made the company to be the flag ship product until in October 11 2001, when it had to file for bankruptcy. This happened because of certain number of reasons. The management was not ready to part with the company he was still hoping that it will someday be profitable .This being the reason as to why in August 1988, when shamrock offered to buy the company at $40 per share the director rejected his offer. Yet there were signs to show that the company was sinking .In 1990 the overall sale was stagnant and the demand for install firm had reduced because of the one hour photo shops for conventional film that was growing rapidly (Jewell, 2000.p.27).
It is also believed that the bankrupt was caused by the senior manager failing to anticipate the effects of digital cameras on it film business. Another cause of bankrupt was the huge loans that had piled up. The idea of the new manager to restrict Polaroid by cutting out the work force led to the loss of 15% or 1570 jobs this led to a net loss of $142.The managers had no idea on how to deal with the problems that were affecting the companies. The world economic difficult of 1997 provided more problems to the Polaroid which had a significant portion of it revenue outside the UK (Palmer, 1991, p.39). Escalation commitment is a condition where people believe in what is failing. They refuse to accept they have no solution to a certain problem, It can therefore be traced is to an escalation commitment because; Instead of putting the company to a halt because of the losses and failures it was experiencing the manager went on investing new project
REFERENCE
Jewell, M. [2000] New Polaroid Boston: Associatoin press
Palmer. [1991]Financial workflows Angelos: Corporative press
