Structured prescriptive models of risk attitudes
Management Science
Information and Management
A Case for Using Real Options Pricing Analysis to Evaluate Information Technology Project Investment
Information Systems Research
Real Options and IT Platform Adoption: Implications for Theory and Practice
Information Systems Research
A Bayesian belief network for IT implementation decision support
Decision Support Systems
Information Systems Management
Real option valuation on grid computing
Decision Support Systems
Super-Flexibility for Knowledge Enterprises: A Toolkit for Dynamic Adaptation
Super-Flexibility for Knowledge Enterprises: A Toolkit for Dynamic Adaptation
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Upon the initiation of an information system (IS), decision makers typically have a choice between different levels of flexibility, that is the extent to which the IS can be modified or upgraded during its subsequent lifetime. In the current paper, we regard IS flexibility as an option that is available to the decision maker, and demonstrate several approaches to determine its value. Extending a previous theory of IS flexibility, we calculate the value of flexibility by applying decision tree analysis (DTA), real option analysis (ROA), and explicit risk assessment based on simulation experiments. We find that the deterministic treatment of IS flexibility tends to underestimate its value, whereas ROA can overestimate its value, in particular in low-risk situations. Our findings highlight the need for the concrete measurement of IS flexibility.