Abstract for: Real Options Approach for Innovation Implementation Strategies
Many interventions that are effective in one setting may be ineffective or even harmful in other settings. This poses a problem for organizations and communities engaged in planning efforts seeking to improve outcomes. This paper introduces the use of managerial real options combined with system dynamics models to design strategies for implementing community interventions when their effectiveness may be uncertain. A new notation for representing implementation strategies using real options is introduced. The approach is illustrated with an example of domestic violence community interventions. Results show that there are potential benefits to using a real options approach.