Abstract
Many emerging architectural/engineering/construction (A/E/C) technology investments are of strategic importance and may create future growth opportunities. Therefore, from the strategic perspective, management needs a better method that can quantify the strategic value of technology investment and suggest optimal investment strategies when the future is uncertain. This paper presents a quantitative valuation method based on modern option pricing theory for evaluating major investments in emerging A/E/C technologies. This framework considers specifically the technology investment risk and embedded managerial options. It further aligns the investment evaluation process with the financial market. The analysis may help A/E/C firms more accurately evaluate investments in emerging technologies, such as information technology and automation, and make strategic investment decisions under uncertainty.
| Original language | English (US) |
|---|---|
| Pages (from-to) | 16-24 |
| Number of pages | 9 |
| Journal | Journal of Construction Engineering and Management |
| Volume | 129 |
| Issue number | 1 |
| DOIs | |
| State | Published - Jan 2003 |
| Externally published | Yes |
Keywords
- Construction management
- Financial management
- Management methods
- Risk management
- Technology
ASJC Scopus subject areas
- Civil and Structural Engineering
- Building and Construction
- Industrial relations
- Strategy and Management