Abstract
This paper develops a real options decision support tool for raising the performance of the firm. It shows how entrepreneurs can use our intuitive tool quickly to assess the nature and type of action required for improved performance. This exploits our estimated econometric relationship between precipitators of entrepreneurial opportunities, time until exercise, and firm performance. Our 3D chromaticity plots show how staging investments, investment time, and firm performance support entrepreneurial decisions to embed, or to expedite, investments. Speedy entrepreneurial action is securely supported with this tool, without expertise in econometric estimation or in formulae for real options valuation.
Original language | English |
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Pages (from-to) | 56-64 |
Number of pages | 9 |
Journal | Managerial and Decision Economics |
Volume | 39 |
Issue number | 1 |
Early online date | 23 Jul 2017 |
DOIs | |
Publication status | Published - Jan 2018 |
Keywords
- Real options
- Decision support
- Strategic flexibility
- Performance