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Why use them?
In an increasingly uncertain world, real options have different applications as a management tool. They will change the way you value opportunities. They will change the way you create value => both reactively and proactively. And they will change the way you think about how and where to invest your money.
Today, we compete in a global market that is highly unstable, rapidly changing and unpredictable, where profitable customers are hard to find and even harder to keep. Competitors can appear from anywhere at anytime, driving down prices and lowering margins. This unpredictability is fuelled by the fast-paced electronic commerce environment; volatility in capital markets affecting stocks, currencies and interest rates; and the emergence of new technologies impacting almost every area in business.
Companies, who can make better decisions faster, will create competitive advantage. As a result, planning and budgeting is becoming a significant concern and focus for improvement in today’s challenging business environment.
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