This research has first presented a picture of very large industrial real investments, safe to say, a group of investments that has not received a lot of attention from researchers. The notion of understanding very large industrial real investments as a special group within the group of real investments is a new approach.
This research has concentrated on investment valuation issues, and has taken the approach of defining the research scope by defining a set of investments within the group of very large industrial real investments, to simplify the complexity. The group of giga-investments has been analysed and their valuation needs discussed. It was revealed that existing investment valuation methods, if not incompatible, are sub-optimal for giga-investments. This research has not gone as far as to say that this analysis is true for very large industrial investments in general, but it applies to giga-investments. In this research contributions have been made to the valuation of giga-investments by enhancing existing models to suit giga-investments better and by proposing a framework for a new model, based on giga-investments, for their valuation.
Observation that the giga-investment lifecycle, which this research models in three stages, as opposed to the commonly used two-stage investment lifecycle models, may play a key role in the correct valuation of giga- investments, is, to the best of our knowledge, an original contribution to the knowledge about very large industrial real investments.
Giga-investments seem to benefit from a dynamic approach to planning and management, which is based on continuous environmental scanning and updating of information. This is true for a number of reasons, of which the least is not the dynamic nature of options that are found within investments. This research has looked into how a dynamic approach to planning and management benefits organisations to overcome separation of planning and management, and how, if properly supported, this can be done effectively with a help of intelligent decision support systems. The whole dynamic approach to planning and management is a fairly new approach and this research has contributed to, perhaps, changing the way
we think about planning and management of very large industrial real investments.
5.2.1. Weaknesses of this Research
When viewing this research critically from the point of view of research methodology, one may criticise the fact that the background material used for the initial investigations could have been wider than the four presented cases, and that the action research part of the research should have been more thoroughly elaborated. This would be a just comment. However, it was the decision of the author to present the results of the action research and cases, the VLIRI characteristics, in a looser format. This was selected, because it allows falsification by empirical investigation. The presentation of the basis for the definition of giga-investments, by using these characteristics, would then also be falsifiable. Yet, some may disagree on the wisdom of these choices, and a more thorough investigation (empirical) into very large industrial real investments, and their characteristics might have made the disagreement go away.
One singular point that can be raised is the suspicion of the suitability of the Black-Scholes option-pricing model for the valuation of real options. This has been discussed in the thesis and the author does not draw any definite conclusions as to whether the use of the model is justified or not. However, not being able to definitely make a judgement about the usability of the model is a known weakness of this thesis. In all fairness it needs to be observed that proof on the matter has as of yet eluded the scientific community.
Another point where criticism can be justifiably levelled is the usage of different mathematical models in valuing giga-investments. Has the author created models that correctly picture reality? This research does not fully test the created models, therefore, such judgement cannot be made on the basis of this research. Further systematic empirical research is be needed. This may, by some, be a significant weakness of this research. The author acknowledges this fact, and agrees that it is a weakness. However, the motivation of this research has been to create a new knowledge about very large industrial real investments and to show that it is possible to model them. The correctness of the models, when taking the point of view of this research, is an important issue. However, it is not the most important issue, which is to contribute new knowledge. Still, the author believes that the models presented enhance our ability to correctly value giga-investments.
This research has not emphasised the organisational, psychological, and agency problems of investment decision making. It has been the choice of the author to omit these issues, even if they unarguably are interesting and important issues when decision making is investigated.
Some might argue that the presentation of the dynamic approach to planning and management has been short, and deserves much wider attention. While the author agrees, it has not been the motivation of this research to concentrate on the decision support system aspects of giga- investments, but to focus on gaining new knowledge about them and valuing them. It is, however, a just critique of this research that when an issue is as interesting as the decision support of giga-investments is, it should merit more attention, than the introduction of this research is able to provide. This research has, nevertheless, shown an intuitive approach to decision support that seems to be more suitable for giga-investments than the currently used approaches.