Anchoring-and-adjustment in software project management: an experimental investigation

Abstract

Software project development continues to be characterized by cost overruns, late deliveries, poor reliability and user dissatisfaction. The Systems Dynamics Model of Software Project Management is a quantitative model of software project dynamics that is attempting to gain some valuable insight into the managerial side of developing software systems. The objective of this thesis was to use the Systems Dynamics Model's gaming interface to investigate the cognitive heuristic anchoring-and-adjustment in dynamic decision environments, and its use in software project management. Specifically, subjects were provided with either a low or a high anchor condition to determine the effect on subject productivity estimation and project performance when confronted with dynamic decision making in software project management. The result show that subjects used anchoring to simplify decision making in the complex dynamic environment. There was evidence of bias introduced by the anchor, thereby causing dysfunctional performance.