Real Option As The Tool For Valuation And Strategic Guidance For The Post-Industrial Organizations

Abstract

Post industrial organization puts premium on flexibility, and also on assets that confer flexibility. In the post-industrial business environment, uncertainty need to be understood and managed to reap the potential benefit. Flexibility in organization enables it to take benefit of such uncertainty. Flexibility can be increased by tangible assets; and also by intangible assets like knowledge, group work, routine and experience. “Real options” confer value to flexibility. Besides valuation It also provides decision making guidance for managers involved in identification, acquisition and development of (both tangible and intangible) resources that post industrial organization require to make itself flexible.