Real options

Real Options
Jürgen De Smet & Yves Hanoulle

What do you know about Real options?
Nothing
A LOT
Little bit
2

What do you want to learn?
3
3

Up-front decisions
Up-Front Decisions
4

You don’t need to decide right now!
5

Only decide when to decide
6

Keep as many options open as possible
7

Actively gather information until you have to decide
8

You only commit when you must
9

when you have a good reason to
10

Why do you want to do that?
11

Later you are smarter
12

you can deal with risks
13

a real option has a value
14

a real option has experiation criteria
15

a real option has a cost
16

Common sense?
17

Common sense for teams
18

Real options decision making – Identify Options
A
B
Options
C
19

Real options decision making – Identify Conditions
A
X or Y
B
conditions
X and Y
C
Z
20

Real options decision making – put on timeline
A
X or Y
B
X and Y
C
Z
21

Real options decision making – Identify deadline
A
X or Y
B
X and Y
C
Z
22

Real options decision making – Time to decide
A
X or Y
B
X and Y
C
Z
first decision point
23

Real options decision making – wait for first condition
A
?
X or Y
B
X and Y
C
Z
24

Real options decision making – Refine options
A2
X or Y
B
X and Y
C
Z
25

Real options decision making – Find new options
A2
X or Y
B
X and Y
C
Z
D
Y
26

Real options decision making – Push back decision
A2
X or Y
B
X and Y
C
C
Z‘
Z
D
Y
27

Real options decision making – Plan D?
A2
X or Y
B
X and Y
C
Z‘
D
Y
28

This is great
29

Set based design
30

Vehicle designs
20 entered in a competition
5 worked out in detail
4 claymodels made
2 prototypes made and revised
1 model chosen
Design options
31
31

80 types considered
narrowed down to 10 by testing
4 types after more extensive testing
1 selectedafterevalutation by computer simulations
Type of engines
32

agile user stories
33

Test Driven Development
34

Dimensional planning – Dirt road
35

Dimensional planning – Cobblestone road
36

Dimensional planning – Highway
37

Why is dimensional planning valuable?
Amsterdam
highway
Heusden
38

Heusden (Netherlands)
Amsterdam
highway
Who is paying for this expensive mistake?
Heusden (Belgium)
Lets create a tighter contract so the customer does!
39

Amsterdam
Heusden (Belgium)
40

Amsterdam
Heusden (Belgium)
41

highway
Amsterdam
Heusden (Belgium)
42

Dimensional Planning vs Cost?
Amsterdam – Heusden Belgium : Dirt Road
Amsterdam – Heusden Netherlands: Dirt Road
Amsterdam – Heusden Netherlands: Cobblestone
VS
Amsterdam – Heusden Belgium Highway
+
Amsterdam – Heusden Netherlands ????
43

44

Story Mapping
45

Real options vs Change requests
46

Generate as much options as possible
Identify the conditions and expiration timing
Decide when to decide
Actively go for more info
Go for multiple options if needed
Wait as long as possible
Decide fast
Get Real
47

Look back at your questions...
48
48

http://www.agilecoach.net/html/Real%20Options%20handout.pdf
The Toyota Way-Jeffrey Liker, pp 239-240: http://www.amazon.com/The-Toyota-Way-ebook/dp/B000SEGIVS
Koen van Exem: http://www.inxin.com/wiki/DimensionalPlanning
Software by Numbers: http://www.amazon.com/Software-Numbers-Low-Risk-High-Return-Development/dp/0131407287/
http://leanprocrastination.com/blog/2011/09/a-backlog-is-waste-fill-it-later/
Resources
Jürgen De Smet & Yves Hanoulle
49

http://www.hanoulle.be	537
http://paper.li	32
http://tweetedtimes.com	3
http://feeds.feedburner.com	2

Real options

by Yves Hanoulle

Accessibility

Categories

Upload Details

Usage Rights

4 Embeds 574

Statistics

Real options Presentation Transcript

Real options

by Yves Hanoulle

Accessibility

Categories

Upload Details

Usage Rights

4 Embeds 574

Statistics

Real options Presentation Transcript

Let LinkedIn power your SlideShare experience

Let LinkedIn power your SlideShare experience

Customize SlideShare content based on your interests

Keep up to date when your LinkedIn contacts post on SlideShare