 Managing Operational Flexibility in Investment Decisions: The Case of IntelPeter Miller and Ted O'Leary Journal of Applied Corporate Finance, 2005, vol. 17, issue 2, 87-93 Abstract: Significant attention has been paid to how real options analysis can help in valuing operating flexibility when making major capital investment decisions. But there has been far less study of how to manage such flexibility, particularly in cases where a decision to defer, contract, or expand any one investment program affects a range of other programs, including those outside the firm. Such interrelated investments are increasingly common in a “connected” economy where products and technologies are designed across firms and industries. Based on a field study at Intel, this paper describes and analyzes one set of practices for coordinating such diverse systems of investments. It shows how information about interrelated investments is communicated within and between companies so that coherent changes can be made at the level of an overall system. The authors argue that studies of investment appraisal need to move beyond the predominant focus on valuation to encompass the wider organizational processes by which operational flexibility is exercised in the modern economy. Date: 2005 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:bla:jacrfn:v:17:y:2005:i:2:p:87-93 Ordering information: This journal article can be ordered from Access Statistics for this article Journal of Applied Corporate Finance is currently edited by Donald H. Chew Jr. More articles in Journal of Applied Corporate Finance from Morgan Stanley |
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