Screening for Real Options “In” an Engineering System: A Step Towards Flexible System Development
The goal of this research is to develop an analytical framework for screening for real options “in” an engineering system. Real options is defined in the finance literature as the right, but not the obligation, to take an action (e.g. deferring, expanding, contracting, or abandoning) at a predeter...
| Main Authors: | , , , |
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| Format: | Presentation |
| Published: |
2014
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| Subjects: | |
| Online Access: | http://hdl.handle.net/1721.1/84190 |
| _version_ | 1826215533869006848 |
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| author | Bartolomei, Jason E. Hastings, Daniel E. de Neufville, Richard Rhodes, Donna H. |
| author_facet | Bartolomei, Jason E. Hastings, Daniel E. de Neufville, Richard Rhodes, Donna H. |
| author_sort | Bartolomei, Jason E. |
| collection | MIT |
| description | The goal of this research is to develop an analytical framework for screening for real options “in” an
engineering system. Real options is defined in the finance literature as the right, but not the obligation, to
take an action (e.g. deferring, expanding, contracting, or abandoning) at a predetermined cost and for a
predetermined time. These are called "real options" because they pertain to physical or tangible assets,
such as equipment, rather than financial instruments. Real options improve a system’s capability of
undergoing classes of changes with relative ease. This property is often called “flexibility.” Recently, the
DoD has emphasized the need to develop flexible system in order to improve operational, technical, and
programmatic effectiveness. The aim of this research is to apply real options thinking to weapon
acquisitions in order to promote the ability of weapon system programs to deftly avoid downside
consequences or exploit upside opportunities. |
| first_indexed | 2024-09-23T16:33:54Z |
| format | Presentation |
| id | mit-1721.1/84190 |
| institution | Massachusetts Institute of Technology |
| last_indexed | 2024-09-23T16:33:54Z |
| publishDate | 2014 |
| record_format | dspace |
| spelling | mit-1721.1/841902019-04-12T20:47:44Z Screening for Real Options “In” an Engineering System: A Step Towards Flexible System Development Bartolomei, Jason E. Hastings, Daniel E. de Neufville, Richard Rhodes, Donna H. engineering systems real options flexibility design structure matrices (DSMs) engineering system matrix (ESM) The goal of this research is to develop an analytical framework for screening for real options “in” an engineering system. Real options is defined in the finance literature as the right, but not the obligation, to take an action (e.g. deferring, expanding, contracting, or abandoning) at a predetermined cost and for a predetermined time. These are called "real options" because they pertain to physical or tangible assets, such as equipment, rather than financial instruments. Real options improve a system’s capability of undergoing classes of changes with relative ease. This property is often called “flexibility.” Recently, the DoD has emphasized the need to develop flexible system in order to improve operational, technical, and programmatic effectiveness. The aim of this research is to apply real options thinking to weapon acquisitions in order to promote the ability of weapon system programs to deftly avoid downside consequences or exploit upside opportunities. 2014-01-23T18:19:06Z 2014-01-23T18:19:06Z 2006-04-07 Presentation Technical Report http://hdl.handle.net/1721.1/84190 Attribution-NonCommercial-ShareAlike 3.0 United States http://creativecommons.org/licenses/by-nc-sa/3.0/us/ application/pdf |
| spellingShingle | engineering systems real options flexibility design structure matrices (DSMs) engineering system matrix (ESM) Bartolomei, Jason E. Hastings, Daniel E. de Neufville, Richard Rhodes, Donna H. Screening for Real Options “In” an Engineering System: A Step Towards Flexible System Development |
| title | Screening for Real Options “In” an Engineering System: A Step Towards Flexible System Development |
| title_full | Screening for Real Options “In” an Engineering System: A Step Towards Flexible System Development |
| title_fullStr | Screening for Real Options “In” an Engineering System: A Step Towards Flexible System Development |
| title_full_unstemmed | Screening for Real Options “In” an Engineering System: A Step Towards Flexible System Development |
| title_short | Screening for Real Options “In” an Engineering System: A Step Towards Flexible System Development |
| title_sort | screening for real options in an engineering system a step towards flexible system development |
| topic | engineering systems real options flexibility design structure matrices (DSMs) engineering system matrix (ESM) |
| url | http://hdl.handle.net/1721.1/84190 |
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