Groupe d’études et de recherche en analyse des décisions

G-89-45

Flexibility, Efficiency, and Contingent Claims

This paper develops a conceptual framework for flexibility. A definition of flexibility is presented that is general enough to be applicable to all areas of management where it plays a role. The definition is anchored to performance measures (static and dynamic efficiency) and to the concept of contingent claims, which, besides rendering it more precise, provides a conceptual basis for flexibility valuation modeling.

, 26 pages