• Proceedings of the Technology Innovation Conference
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• 2001.06a
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• pp.117-130
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• 2001

R&D is the core competence of an enterprise. Furthermore, R&D requires huge capital investment and has very risky characteristics. Therefore, to be successful in R&D process, several approaches of engineering economics are used prior to decision-making. Until now, typical approaches of engineering economics such as NPV(net present value) or DCF(Discounted cash flow) have been used. But, they cannot properly capture managerial flexibility to adapt and revise later decisions in response to unexpected market development. In a constantly changing and always uncertain marketplace, managerial operation flexibility and strategic adaptability have become vital in order to successfully capitalize on favorable future investment opportunities and limit losses from adverse market development. For the alternatives of conventional static decision-making approaches, new concept of using real options is introduced. Real option theory is based on financial option's characteristics and checks every revision interval whether situation have changed favorable to decision maker or not. In advantageous situation, the decision maker has only to go on. In contrast, with unfavorable situation, he abandons the investment immediately. In this aspect, real option model is more suitable in very uncertain and dynamic business environment in that it can provide the opportunity to cope with flexibility. This paper suggests efficient and effective R&D investment strategy by using real options model. In addition, this paper compares financial options and real options.

• Convergence Security Journal
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• v.9 no.1
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• pp.39-44
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• 2009

To get legitimacy of a security investment, the analysis of ROI about the security investment is required. In this paper, we suggest a practical quantitative model with considering factors that do decision-making of optimized security investment difficult. This model makes use of the value of a residual risk to decide the best information security solution and considers a corelation of response techniques of the information security solution against each threat to do exact decision-making.

• Journal of Korean Society of Industrial and Systems Engineering
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• v.16 no.27
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• pp.113-119
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• 1993

The purpose of this study is to develop a analytic procedure of the alternatives for the FMS that consist of high-priced facilities. A procedure to analysis the alternatives are as follows. Stage one is procedure to appraise investment alternatives of FMS and devide factors into strategic, analytic, economic viewpoint and draw upon decision making matrix through normalization Stage two is appraise to normalized alternatives using TOPSIS model among multiple attributes decision making models.

• Journal of the Korea Safety Management & Science
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• v.6 no.3
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• pp.275-285
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• 2004

This paper aims to construct an effective decision making model on selection of product design in product development using fuzzy AHP technique. It is expected that this paper contributes to enhancement of company's market competitiveness by shortening the lead time to develop a new product and minimize initial investment. The proposed model using fuzzy AHP enables quick decision making by integrating and analyzing all customer requirements related to a product. In addition, it can deal with vagueness and uncertainty of decision making process using fuzzy set theory. Decision making processes for evaluating the best selection of product design are also constructed to describe the exact concept of development. A tennis racket is shown as an example. The proposed model is expected to be applied in various fields of managerial decision making processes as well as of product development process.

• Journal of Korean Society of Industrial and Systems Engineering
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• v.18 no.34
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• pp.51-60
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• 1995

The key competition factor of manufacturing industries has progressively changed from cost to quality and time. Recently, the manufacturing environments more rapidly change than before. So, many companies want to introduce a advanced manufacturing system like CIMS to meet various user's needs and short delivery. But there is a considerable gap between the decision to invest and the achievement of promised benefits. Managers, generally, cannot afford CIM invesment unless they can determine beforehand that CIM will work in thier company and that will provide a coherent strategy and satisfactory return on investment In many cases, it is impossible to justify CIM investment by only economical analysis. Decision making problems like CIM investment are of a multiple objective nature. So, decision making process and multiattribute utility function are very useful methods to evaluate CIM justification In this paper, we described the key functions of CIM justification evaluation using IDEF methodology and developed the applicattion procedure of DMP and MUF method for CIM justification.

• Journal of Information Technology Applications and Management
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• v.12 no.1
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• pp.191-211
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• 2005

This study investigates the decision criteria used in the context of IT investment decision making and empirically analyzes the impact of IT project size and types on the importance of decision criteria. 5 criteria which have been extracted from the previous studies and industry practices are budget, financial benefits. strategic value. risk, and the degree of proposer's eagerness. Data of 120 IT project proposals have been collected from 5 companies including bank, insurance. and stock trading company. As results of ANOVA test. 7 out of 10 hypothesis have been accepted statistically. That is. the bigger the project size. the higher the evaluation weight of project budget and risk criteria and the lower the weight of proposer's eagerness. And in case of the infrastructure investment type. the emphasis is placed more on strategic value and risk criteria and less on financial benefit and proposer's eagerness. These findings provide insights for both IT practitioners and researchers.

• Communications of the Korean Institute of Information Scientists and Engineers
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• v.5 no.2
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• pp.28-34
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• 1987

This paper, according to modern theories of investment decision, designed physical investment decision system. The design of this system, mainly on the basis of both the evaluation of investment proposal and the procurement of fund, consists of the designs of input/output system, the evaluation system of investment proposal, the calculating system of capital cost, and the investment system integrated all the above systems. This system premised the use of computer intended to transform the unreasonable methods of present investment decision making into more reasonable one.

• Journal of Distribution Science
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• v.13 no.9
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• pp.5-11
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• 2015

Purpose - The purpose of this research is to provide insights that can be used for deliberate decision making around challenging big data investments by measuring the economic value of such big data implementations. Research design, data, and methodology - We perform empirical research through an event study. To this end, we measure actual abnormal returns of companies that are triggered by their investment announcements in big data, or firm size information, during the three-year research period. The research period targets a timeframe after the introduction of big data at Korean firms listed on the Korea stock markets. Results - Our empirical findings discover that on the event day and the day after, the abnormal returns are significantly positive. In addition, our further examination of firm size impacts on the abnormal returns does not show any evidence of an effect. Conclusions - Our research suggests that an event study can be useful as an alternative means to measure the return on investment (ROI) for big data in order to lessen the difficulties or decision making around big data investments.

• IE interfaces
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• v.20 no.3
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• pp.267-276
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• 2007

When a company makes a decision on an investment for a new product as a source for a new program, it is not easy for them to take a proper decision-making process in this highly volatile market. There could be several ways to make an investment decision on a new program. A company needs to choose the most suitable way of investment which is reflected current corporate circumstances and potential risks. We check up the process of the engineering economic decision in a automotive part manufacturing company. We define the gap between the theory and practice on engineering economic decisions. We present advices to make a decision desirably.

• Journal of the Korea Safety Management & Science
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• v.7 no.4
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• pp.165-177
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• 2005

Supply Chain Management(SCM) system is a critical investment that can affect future competitiveness and performance of a company. Selection of a right SCM system is one of the critical issues. This paper provides the characteristic factors of SCM system selection and the SCM system evaluation and selection model based on Analytic Hierarchy Process(AHP). The proposed model can systematically construct the objectives of SCM system selection to support the business goals. A empirical example demonstrates the feasibility of the proposed model and the model can help a company to make better decision-making in selecting SCM system.