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The decision process of product innovation-using real option analysis

New product innovation strategy is always be the best way for corporations to enhance earning. A lot of essays have discussed the benefits of innovation strategy and the factors that make innovation strategy successful. However, different innovation degree creates different effects and costs. By former researchs, the higher degree of innovation dosen¡¦t guarantee the huger of profit. Therefore, knowing the decision procerss of new product innovation is realy important and worthful.
In this article, we divide new products into two groups with different innovation degree: the minor innovation product (incremental innovation product) and the major innovation product (radical innovation product). By using real options analysis method, we build a evaluation model to estimate the new product value during the procerss of new product innovation. We also go into what factors will influence the corporations¡¦ decision. Furthermore, we do the sensitivity analysis with numerical method and to realize corporations¡¦ preference and tendency in product innovation decision. At last, we use the real option evaluation model to analyze some product innovation cases in Taiwan.

Identiferoai:union.ndltd.org:NSYSU/oai:NSYSU:etd-0623106-010607
Date23 June 2006
CreatorsYang, Yuh-lin
ContributorsJen-jsung Huang, Huei-mei Liang, Miao-ling Chen
PublisherNSYSU
Source SetsNSYSU Electronic Thesis and Dissertation Archive
LanguageCholon
Detected LanguageEnglish
Typetext
Formatapplication/pdf
Sourcehttp://etd.lib.nsysu.edu.tw/ETD-db/ETD-search/view_etd?URN=etd-0623106-010607
Rightsnot_available, Copyright information available at source archive

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