By a News Reporter-Staff News Editor at Information Technology Newsweekly -- Researchers detail new data in Information Systems. According to news reporting originating from Towson, Maryland, by VerticalNews correspondents, research stated, "This paper develops an innovative real options (RO) model for valuing multistage information technology (IT) projects that can be viewed as comprising meta stages. In RO literature, multistage investment programs have been treated as either interproject or intraproject programs, with intraproject programs being evaluated using n-fold Geske compound options and interproject programs valued using the so-called 'subsidy-to-exercise price' logic."
Our news editors obtained a quote from the research from Towson University, "Our innovative RO model integrates the Geske compound option model with the subsidy-to-exercise price approach to value sequential investment programs that are neither purely interproject nor purely intraproject in nature but are composed of meta-stages. A meta-stage as a whole can be considered an interproject stage resulting in cash flows, but internally it consists of several intraproject stages that do not result in cash flows. We show that a key problem in IT, which is migrating to a Service-Oriented Architecture (SOA) for integrating a firm's many disparate applications, systems, data, and business processes, is best viewed as an investment program comprising meta-stages. Examining SOA migration from an RO lens is particularly apt at this time not only because of the importance of SOA but also because doubts have surfaced about the value of SOA. We illustrate our RO model by applying it to the simulated case of a firm migrating to SOA."
According to the news editors, the research concluded: "We also develop a software tool based on the Mathematica T computational platform so that practitioners can easily apply our innovative options pricing model to determine the true value of SOA in their business contexts."
For more information on this research see: A Real Options Model for Generalized Meta-Staged Projects-Valuing the Migration to SOA. Information Systems Research, 2013;24(4):1011-1027. Information Systems Research can be contacted at: Informs, 5521 Research Park Dr, Suite 200, Catonsville, MD 21228, USA.
The news editors report that additional information may be obtained by contacting S. Ghosh, Towson Univ, Coll Business & Econ, Dept. of E Business & Technol Management, Towson, MD 21252, United States.
Keywords for this news article include: Towson, Maryland, United States, Information Systems, North and Central America
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