The development phase of systems engineering is one of the most critical phases in the entire life of a project because it is at that point the majority of the projects technology and committed costs are determined (Buede 2000). Yet, the decision tools available to assist systems engineers in choosing between technology alternatives at this phase are extremely limited, consisting mainly of the financial models of net present value and return on investment. Conceptually, if we view the alternatives available as a portfolio of cost, performance, and schedule options, then we can extend the financial portfolio model of Real Options Analysis (ROA) into system engineering. Such an extension is the first element of my research. However, because there is a need to extend beyond strictly the financial realm, I then introduce an advanced performance model, Technology Options Analysis (TOA), which is employed to address a systems performance options. Technology options, while similar to financial options, use performance dimensions such as availability of current and future technologies, technology risks, and industry clock speeds (Fine 1998). The purpose of Technology Options Analysis is to provide a tool that decision makers can use to understand the value of waiting to make a technology selection until some or all of a technologys performance uncertainty has been resolved. Finally, to create a more complete picture of the decision trade space, I combined Real Options and Technology Options into a unified algorithm that incorporates both performance and cost uncertainty into the decision making process. The aspect of schedule is beyond the scope of this dissertation and is left for future research. Applicability of the models are illustrated in the context of one case study.
| Identifer | oai:union.ndltd.org:VANDERBILT/oai:VANDERBILTETD:etd-03302009-145827 |
| Date | 20 April 2009 |
| Creators | Van Dyk, Steven Elliott |
| Contributors | Professor Kenneth R. Pence, PhD, Professor Sankaran Mahadevan, PhD, Professor David M. Dilts, PhD MBA, William R. Mahaffey, PhD |
| Publisher | VANDERBILT |
| Source Sets | Vanderbilt University Theses |
| Language | English |
| Detected Language | English |
| Type | text |
| Format | application/pdf |
| Source | http://etd.library.vanderbilt.edu//available/etd-03302009-145827/ |
| Rights | unrestricted, I hereby certify that, if appropriate, I have obtained and attached hereto a written permission statement from the owner(s) of each third party copyrighted matter to be included in my thesis, dissertation, or project report, allowing distribution as specified below. I certify that the version I submitted is the same as that approved by my advisory committee. I hereby grant to Vanderbilt University or its agents the non-exclusive license to archive and make accessible, under the conditions specified below, my thesis, dissertation, or project report in whole or in part in all forms of media, now or hereafter known. I retain all other ownership rights to the copyright of the thesis, dissertation or project report. I also retain the right to use in future works (such as articles or books) all or part of this thesis, dissertation, or project report. |
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