Real Options in Management and Organisational Strategy : A Review of Decision Making and Performance Implications

This paper contributes to the debate on the role of real options theory in business strategy and organisational decision-making. It analyses and critiques the decision-making and performance implications of real options within the management theories of the (multinational) firm, reviews and categorises the organisational, strategic and operational facets of real options management in large business settings. It also presents the views of scholars and practitioners regarding the incorporation and validity of real options in strategy, international management and business processes. The focus is particularly on decision-making and performance attributes of the real options logic concerning strategic investments, governance modes and multinational operations management. These attributes are examined from both a strategic and operating perspective of decision-making in organisations, with also an overview of the empirical evidence on real options decision-making and performance