Abstract
The need for flexibility in organizations has been espoused by many researchers and professionals. Despite the felt need and real-life practice of diverse shades of flexibility, its valuation has not been adequately addressed. Though the flexibility initiatives help in fulfillment of strategic goals, these require capability development and thereby cost inputs for their realization. The benefits of flexibility define its worth, which in relation to the associated cost gives its value or affordability. Initially, the chapter gives an overview of different types of flexibility initiatives with real-life case examples. This chapter provides a conceptual framework for valuation of flexibility initiatives in terms of fulfillment of needs leading to benefits and the requirements of capability building for implementing these initiatives requiring cost inputs. The framework is illustrated by few examples such as variable capacity, multiskilling, and flexi-time/flexi-place. It compares the flexibility initiatives using interpretive ranking process (IRP) and Total Interpretive Structural Modelling (TISM).
This is a preview of subscription content, log in via an institution to check access.
References
Allen, L., & Pantzalis, C. (1996). Valuation of the operating flexibility of multinational corporations. Journal of International Business Studies, 27(4), 633–653.
Eppink, D. J. (1978). Planning for strategic flexibility. Long Range Planning, 11(4), 9–15.
Kulatilaka, N. (1993). The value of flexibility: The case of a dual—Fuel industrial steam boiler. Financial Management, 22(3), 271–280.
Lee, S.-H., & Makhija, M. (2009). Flexibility in internationalization: Is it valuable during an economic crisis? Strategic Management Journal, 30(5), 537–555.
Mason, S. P. (1984). Valuing financial flexibility, NBER Working Paper, Cambridge, MA.
Merkhofer, M. W. (1977). The value of information given decision flexibility. Management Science, 23(7), 716–727.
Schober, F., & Gebauer, J. (2009). How much to spend on flexibility? Determining the value of information system flexibility. In Proceedings of the Fifteenth Americas Conference on Information Systems, San Francisco, California, August 6th–9th 2009.
Sharma, M. K., Sushil and Jain, P. K. (2010). Revisiting Flexibility in Organizations: Exploring its Impact on Performance. Global Journal of Flexible Systems Management, 11(3), 51–68.
Sushil. (1997). Flexible systems management—An evolving paradigm. Systems Research and Behavioral Science, 14(4), 259–275.
Sushil. (2009). Interpretive ranking process. Global Journal of Flexible Systems Management, 10(4), 1–10.
Sushil. (2012a). Flowing stream strategy: Managing confluence of continuity and change. Journal of Enterprise Transformation, 2(1), 26–49.
Sushil. (2012b). Making flowing stream strategy work. Global Journal of Flexible Systems Management, 13(1), 25–40.
Sushil. (2012c). Flexibility maturity model: Possibilities and directions. Global Journal of Flexible Systems Management, 13(2), 75–76.
Sushil. (2012d). Interpreting the interpretive structural model. Global Journal of Flexible Systems Management, 13(2), 87–106.
Sushil. (2013). Flowing stream strategy: Leveraging strategic change with continuity. New Delhi: Springer.
Sushil. (2014). The concept of a flexible enterprise. In Sushil & E. A. Stohr (Eds.), The flexible enterprise, Flexible Systems Management (pp. 3–26). New Delhi: Springer.
Sushil. (2015a). Strategic flexibility: The evolving paradigm of strategic management. Global Journal of Flexible Systems Management, 16(2), 113–114.
Sushil. (2015b). Diverse shades of flexibility and agility in business. In Sushil & G. Chroust (Eds.), Systemic flexibility and business agility, Flexible Systems Management (pp. 3–19). New Delhi: Springer.
Sushil. (2015c). Valuation of flexibility. Global Journal of Flexible Systems Management, 16(3), 219–220.
Sushil. (2016a). Managing flexibility: Developing a framework of flexibility maturity model. In Sushil, K. T. Bhal, & S. P. Singh (Eds.), Managing flexibility: People, process, technology and business, Flexible Systems Management (pp. 3–19). New Delhi: Springer.
Sushil. (2016b). Theory of flexible systems management. In Sushil, J. Connel, & J. Burgess (Eds.), Flexible work organizations: The challenges of capacity building in Asia, Flexible Systems Management (pp. 3–20). New Delhi: Springer.
Sushil. (2016c). How to check correctness of total interpretive structural models? Annals of Operations Research. doi:10.1007/s10479-016-2312-3
Sushil. (2017). Multi-criteria valuation of flexibility initiatives using integrated TISM–IRP with a big data framework. Production Planning and Control, https://doi.org/10.1080/09537287.2017.1336794.
Triantis, A. J., & Hodder, J. E. (1990). Valuing flexibility as a complex option. Journal of Finance, 45(2), 549–565.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2018 Springer Nature Singapore Pte Ltd.
About this chapter
Cite this chapter
Sushil (2018). Valuation of Flexibility Initiatives: A Conceptual Framework. In: Sushil, Singh, T., Kulkarni, A. (eds) Flexibility in Resource Management. Flexible Systems Management. Springer, Singapore. https://doi.org/10.1007/978-981-10-4888-3_1
Download citation
DOI: https://doi.org/10.1007/978-981-10-4888-3_1
Published:
Publisher Name: Springer, Singapore
Print ISBN: 978-981-10-4887-6
Online ISBN: 978-981-10-4888-3
eBook Packages: Business and ManagementBusiness and Management (R0)