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In Architectural, Engineering and Construction disciplines, it is accustomed to define every aspect of a project
well before it starts. Typically a scheduling, estimating and budgeting process is the starting point. Once defined,
it is expected that the project manager or builder reproduce those decisions to meet budget and prevent any profit
loss. Hence in today’s culture, moving definitions and decisions to a later time can be seen as procrastination and
dangerous. However, with the Real Options Approach (ROA) - similar to the options theory of the stock market-
decisions can be moved to a later time when more information is known or available, adding more flexibility to
the project. It may sound like a contradiction for the current managerial culture where decisions are made early
during budgeting, but the flexibility of moving decisions to a later time when more information is available, in
fact add value to the projects.
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