Managing Operational Flexibility in Investment Decisions: The Case of Intel

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. 2005 Morgan Stanley.