Management of R&amp;amp;D Projects Under Uncertainty: A Multidimensional Approach to Managerial Flexibility

Santiago, Leonardo; Bifano, Thomas G.

doi:10.1109/tem.2005.844465

Cited by 75 publications

(36 citation statements)

References 19 publications

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“…Algorithm 1 represents a recursive procedure for the computing of the value of the project for each possible state at revision stage, according to equation (10). The project's expected value with respect to the duration of the phase is estimated through simulation, as it is a continuous random variable.…”

Section: Computational Modelmentioning

confidence: 99%

“…Santiago & Bifano (2005) used the methodology proposed by Huchzermeier & Loch (2001) and further developed by Santiago & Vakili (2005), to evaluate the development project of an Adaptive Optics Scanning Laser Ophthalmoscope (AOSLO). Such innovative project of a laser ophthalmoscope differed from the ones available in the market especially due to the high resolution of the images produced by it.…”

Section: Example: Aoslomentioning

confidence: 99%

“…For additional details, omitted in this paper due to space limit and difference in focus, see Santiago & Bifano (2005).…”

Section: Example: Aoslomentioning

confidence: 99%

“…The dimension related to the resolution is presented through levels of development that correspond to the percentage increase in resolution logarithm, and it is displayed in discrete unities of 0.1. For such dimension, we consider that the market's requirement is normally distributed with relative mean equal to 0.2 and standard deviation 0.49 units of measure (for more details, please, see Santiago & Bifano (2005)). …”

Section: Example: Aoslomentioning

confidence: 99%

“…From a practical standpoint, we believe our model can be easily used to support the decision process and to investigate the impact of stochastic time in allocating resources in a R&D project. We illustrate our approach through an empirical example of technology development, already discussed in the literature (Santiago & Bifano, 2005). …”

Section: Introductionmentioning

confidence: 99%

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New product development projects evaluation under time uncertainty

Silva

Santiago

2009

Pesqui. Oper.

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The development time is one of the key factors that contribute to the new product development success. In spite of that, the impact of the time uncertainty on the development has been not fully exploited, as far as decision supporting models to evaluate this kind of projects is concerned. In this context, the objective of the present paper is to evaluate the development process of new technologies under time uncertainty. We introduce a model which captures this source of uncertainty and develop an algorithm to evaluate projects that incorporates Monte Carlo Simulation and Dynamic Programming. The novelty in our approach is to thoroughly blend the stochastic time with a formal approach to the problem, which preserves the Markov property. We base our model on the distinction between the decision epoch and the stochastic time. We discuss and illustrate the applicability of our model through an empirical example.Keywords: decision under uncertainty; dynamic programming; Monte Carlo simulation; project management; R&D projects. ResumoO tempo de desenvolvimento é um dos fatores-chave que contribuem para o sucesso do desenvolvimento de novos produtos. Apesar disso, o impacto da incerteza de tempo no desenvolvimento tem sido pouco considerado em modelos de avaliação e valoração deste tipo de projetos. Neste contexto, este trabalho tem como objetivo avaliar projetos de desenvolvimento de novas tecnologias mediante o tempo incerto. Introduzimos um modelo capaz de captar esta fonte de incerteza e desenvolvemos um algoritmo para a valoração do projeto que integra Simulação de Monte Carlo e Programação Dinâmica. A novidade neste trabalho é conseguir integrar meticulosamente o tempo estocástico a uma estrutura formal para tomada de decisão que preserva a propriedade de Markov. O principal ponto para viabilizar este fato é distinção entre o momento de revisão e o tempo estocástico. Ilustramos e discutimos a aplicabilidade deste modelo por meio de um exemplo empírico.Palavras-chave: decisão sob incerteza; programação dinâmica; simulação de Monte Carlo; gerenciamento de projetos; projetos de P&D.

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Section: Computational Modelmentioning

confidence: 99%

Section: Example: Aoslomentioning

confidence: 99%

“…For additional details, omitted in this paper due to space limit and difference in focus, see Santiago & Bifano (2005).…”

Section: Example: Aoslomentioning

confidence: 99%

Section: Example: Aoslomentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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New product development projects evaluation under time uncertainty

Silva

Santiago

2009

Pesqui. Oper.

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Product Development Process: Using Real Options for Assessments and to support the Decision-Making at Decision Gates

Rocha

Delamaro

Complex Systems Concurrent Engineering

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Abstract. Enterprises need continuous product development activities to remain competitive in the marketplace. Their product development process (PDP) must manage stakeholders' needs -technical, financial, legal, and environmental aspects, customer requirements, Corporate strategy, etc. -, being a multidisciplinary and strategic issue. An approach to use real option to support the decision-making process at PDP phases in taken. The real option valuation method is often presented as an alternative to the conventional net present value (NPV) approach. It is based on the same principals of financial options: the right to buy or sell financial values (mostly stocks) at a predetermined price, with no obligation to do so. In PDP, a multi-period approach that takes into account the flexibility of, for instance, being able to postpone prototyping and design decisions, waiting for more information about technologies, customer acceptance, funding, etc. In the present article, the state of the art of real options theory is prospected and a model to use the real options in PDP is proposed, so that financial aspects can be properly considered at each project phase of the product development. Conclusion is that such model can provide more robustness to the decisions processes within PDP.

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A Tool to Manage Tasks of R&D Projects

Fialho

Godinho

Costa

2015

Operational Research

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We propose a tool for managing tasks of Research and Development (R&D) projects. We define an R&D project as a network of tasks and we assume that different amounts of resources may be allocated to a task, leading to different costs and different average execution times. The advancement of a task is stochastic, and the management may reallocate resources while the task is being performed, according to its progress. The operational cash flows depend on the task completion time, and their expected values follow a stochastic process. We consider that a strategy for completing a task is a set of rules that define the level of resources to be allocated to the task at each moment. We discuss the evaluation of strategies for completing a task, and we address the problem of finding the optimal strategy.

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Management of R&D Projects Under Uncertainty: A Multidimensional Approach to Managerial Flexibility

Cited by 75 publications

References 19 publications

New product development projects evaluation under time uncertainty

New product development projects evaluation under time uncertainty

Product Development Process: Using Real Options for Assessments and to support the Decision-Making at Decision Gates

A Tool to Manage Tasks of R&D Projects

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