Problem structuring in OR practice

This is the final versionWe are conducting a novel analysis of the OR literature with a view to understanding something of the breadth of approaches to problem formulation that are found in published OR work. We make use of probabilistic topic modelling to construct a classifier that can identify texts that are strongly associated with the fields of Problem Structuring Methods, Community OR and Behavioural OR – even if not labelled as such through keywords, titles or abstracts – as exemplars of work that address key problem formulation concepts. We draw on Callon’s notion of problematisation as the theoretical basis for our analysis because it sits outside of OR and thus provides a different perspective on problem formulation and insight into the “abundance of problematisations” that face any OR practitioner engaging with real-world problems

European Option Based R&D Investment Decision Making under Uncertainties

This paper establishes the payoff models of the European option for research and development (R&D) projects with two enterprises in a research joint venture (RJV). The models are used to assess the timing and payoffs of the R&D project investment under quantified uncertainties. After the option game, the two enterprises can make optimal investment decision for the R&D project investment in the RJV

Influential Article Review - A Binomial Compound Option Approach to Modeling Sequential R&D Investments

This paper examines research and development. We present insights from a highly influential paper. Here are the highlights from this paper: In this paper, we propose a binomial approach to modeling sequential R&D investments. More specifically, we present a compound real options approach, simplifying the existing valuation methodology. Based upon the same set of assumptions as prior models, we show that the number of computational steps for valuing any compound option can be reduced to a single step. We demonstrate the applicability of our approach using the real-world example of valuing a new drug application. Overall, our work provides a heuristic framework for fostering the adoption of binomial compound option valuation techniques in R&D management. For our overseas readers, we then present the insights from this paper in Spanish, French, Portuguese, and German

Financial Resources and Technology to Transition to 450mm Semiconductor Wafer Foundries

Future 450mm semiconductor wafer foundries are expected to produce billions of low cost, leading-edge processors, memories, and wireless sensors for Internet of Everything applications in smart cities, smart grids, and smart infrastructures. The problem has been a lack of wise investment decision making using traditional semiconductor industry models. The purpose of this study was to design decision-making models to conserve financial resources from conception to commercialization using real options to optimize production capacity, to defer an investment, and to abandon the project. The study consisted of 4 research questions that compared net present value from real option closed-form equations and binomial lattice models using the Black-Scholes option pricing theory. Three had focused on sensitivity parameters. Moore\u27s second law was applied to find the total foundry cost. Data were collected using snowball sampling and face-to-face surveys. Original survey data from 46 Americans in the U.S.A. were compared to 46 Europeans in Germany. Data were analyzed with a paired-difference test and the Box-Behnken design was employed to create prediction models to support each hypothesis. Data from the real option models and survey findings indicate American 450mm foundries will likely capture greater value and will choose the differentiation strategy to produce premium chips, whereas higher capacity, cost leadership European foundries will produce commodity chips. Positive social change and global quality of life improvements are expected to occur by 2020 when semiconductors will be needed for the $14 trillion Internet of Everything market to create safe self-driving vehicles, autonomous robots, smart homes, novel medical electronics, wearable computers with streaming augmented reality information, and digital wallets for cashless societies