Abstract
Risk Management is still relatively new to Operations Management (OM), but of ever increasing importance given new legislation such as Basel II. The consideration of risk in operations recently led to the emergence of a research interface between OM and Finance. The present article reviews the evolution of the literature on supply contracts towards this interface with the new focal point represented by the application of real options to capacity management in capital intensive industries. It will be shown that options on capacity enable risk-sharing among trading partners, improve economic efficiency and enhance the viability of online trading platforms. As a consequence, we view the establishment of longterm and short-term contracting as an essential step towards superior supplychain efficiency as well as a means of incorporating risk in operations management.
Part of this research was supported by a grant (Adventures) from the German Ministry of Education and Research (BMBF).
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Spinler, S., Huchzermeier, A. (2005). Capacity Options: Convergence of Supply Chain Management and Financial Asset Management. In: Frenkel, M., Rudolf, M., Hommel, U. (eds) Risk Management. Springer, Berlin, Heidelberg. https://doi.org/10.1007/3-540-26993-2_36
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DOI: https://doi.org/10.1007/3-540-26993-2_36
Publisher Name: Springer, Berlin, Heidelberg
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