The Method of Real Options to Encourage the R & D Team

Junfeng Gao, Lan Jiang

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DOI: 10.4236/jssm.2010.32029                

Abstract

In some projects, the R & D appears to be a failure, and according to traditional methods of encouragement motivation, it is hard to get any awards for the R & D team. But there is a valuable option implied in it. This article discusses the method of real options to encourage R & D team when the enterprises can not achieve the desired economic benefit in the case of high-risk project or the immature market. The process of method includes: Identify the real option type of high-risk projects, Design the incentive mechanism and Design specific exercise ways.

Keywords

The High-Risk R & D Project, Real Option Incentive, R & D Team

Conflicts of Interest

The authors declare no conflicts of interest.

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