Designing flexibility in a system with real options
is one method for managing uncertainty. However,
designing flexibility in a "complex system" is only
one of several tasks that must be accomplished if the
flexibility is to be deployable and of value.
Many potential challenges exist throughout an
option s life-cycle that makes design, evaluation,
exercise and management of an option complex. Complex real options" are composed of more than a
single or simple change or addition to a system to
create flexibility. Rather, a complex real option is
likely composed of interconnecting technological,
organizational and process components. A complex real
option may be embedded in a complex system, which has
technical and social system components and the
behaviors that go along with this.
To meet the need for considering flexibility in
complex systems the concept of Life-Cycle Flexibility
(LCF), or flexibility from cradle to grave , is
introduced. LCF considers both physical and social
systems and spans the entire life-cycle of an option,
starting with activities to ready an enterprise for
flexible systems and continues through system
monitoring and option exercise decisions.
is one method for managing uncertainty. However,
designing flexibility in a "complex system" is only
one of several tasks that must be accomplished if the
flexibility is to be deployable and of value.
Many potential challenges exist throughout an
option s life-cycle that makes design, evaluation,
exercise and management of an option complex. Complex real options" are composed of more than a
single or simple change or addition to a system to
create flexibility. Rather, a complex real option is
likely composed of interconnecting technological,
organizational and process components. A complex real
option may be embedded in a complex system, which has
technical and social system components and the
behaviors that go along with this.
To meet the need for considering flexibility in
complex systems the concept of Life-Cycle Flexibility
(LCF), or flexibility from cradle to grave , is
introduced. LCF considers both physical and social
systems and spans the entire life-cycle of an option,
starting with activities to ready an enterprise for
flexible systems and continues through system
monitoring and option exercise decisions.