A real options approach to project management
Boute, R Demeulemeester, E Herroelen, W
Boute, R
Demeulemeester, E
Herroelen, W
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Publication Type
Journal article with impact factor
Editor
Supervisor
Publication Year
2004-05
Journal
International Journal of Production Research
Book
Publication Volume
42
Publication Issue
9
Publication Begin page
1715
Publication End page
1725
Publication Number of pages
Collections
Abstract
When scheduling an uncertain project, project management can wait for additional (future) information to serve as the basis for rescheduling the project. This flexibility enhances the project's value by improving its upside potential while limiting downside losses relative to the initial expectations. Using traditional techniques such as net present value (NPV) or decision tree analysis (DTA) can often lead to misleading results. Instead, a real options analysis should be preferred. The potentials of a real options approach to project management are discussed with an example and future research directions are highlighted.
Research Projects
Organizational Units
Journal Issue
Keywords
33 Built Environment and Design, 3302 Building, 35 Commerce, Management, Tourism and Services, 3507 Strategy, Management and Organisational Behaviour