A real option-based valuation model for Shared Water Saving Management Contract

Hu, Hao; Wang, Qianqian; Gao, Zhichao; Guo, Haiying

doi:10.1016/j.jclepro.2020.125442

Cited by 18 publications

(5 citation statements)

References 27 publications

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“…It is a mainstream valuation method focusing on the discounted cash flow (CF) in the enterprise life cycle. In actual situations [23], the DCF method depends on the future CF. In the 1980s, research experts defined liquidity as part of CF.…”

Section: Discounted Cash Flow (Dcf) Methodmentioning

confidence: 99%

Exploring the Influence of Big Data Technology on the Innovation of the Enterprise Economic Management Mode

2022

Security and Communication Networks

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The aim of this study is to help financial enterprises establish a solid foundation in a big data ecosystem (BDE) and fully play their competitive edges in the fierce business competition. This paper innovatively conducts research studies on the reform of enterprise financial management. First, it expounds on the relevant concepts of big data technology (BDT) alongside financial management. Afterward, the impact of BDT on enterprise financial management is examined. Consequently, a financial enterprise-oriented economic management model is proposed by integrating BDT, enterprise economic management (EEM), and enterprise performance evaluation methods. Further, an experiment is designed to verify the proposed model on estimating the annual enterprise operating income (OI) and human resource (HR) structure. The research findings show that the predicted and actual OI error is within 6%. The predicted enterprise personnel deployment only deviates slightly from actual personnel deployment. Thus, the proposed economic management model can accurately predict OI and cost. It provides a reliable reference for enterprise innovation management, optimizing recruitment conditions, sales strategy, and development strategy. Lastly, the research deficiencies are pointed out alongside corresponding suggestions.

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Section: Discounted Cash Flow (Dcf) Methodmentioning

confidence: 99%

Exploring the Influence of Big Data Technology on the Innovation of the Enterprise Economic Management Mode

2022

Security and Communication Networks

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“…At present, the research topics on WSS outsourcing have covered risk management (Ma et al, 2021), value evaluation of WSS projects (Hu et al, 2021), benefits allocation (Liu et al, 2021) and WSS supply chain (Chen and Wang, 2020). Clearly, the last research direction is most similar to our study, and it involves the decision-making and equilibrium problems caused by the interaction between the service providers and their clients.…”

Section: Water-saving Modesmentioning

confidence: 84%

“…At present, the research topics on WSS outsourcing have covered risk management (Ma et al. , 2021), value evaluation of WSS projects (Hu et al. , 2021), benefits allocation (Liu et al.…”

Section: Literature Reviewmentioning

confidence: 99%

Impact of government subsidy on the optimal strategies of improving water use efficiency for a high-water-consumption manufacturer

2022

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PurposeIn order to encourage the high-water-consumption (HWC) manufacturers to carry out water-saving transformation relying on self-strength or outsourcing to a water-saving service company (WSSC) during production processes, government subsidies are provided according to water-saving efforts (WSE) or investment cost. In this context, the authors derive the participant's equilibrium decisions and the manufacturer's water-saving strategy. Additionally, the effects of subsidies on WSE and stakeholders' profits are discussed.Design/methodology/approachMathematical models including optimization model and Stackelberg game model are constructed under different subsidy schemes.FindingsThe study finds that (1) there exists a threshold related to the subsidy coefficient for the HWC manufacturer when choosing between self-saving and outsourcing-saving. (2) When the technological competitive advantage between WSSC and manufacturer is within a certain range, government's subsidy promotes HWC enterprises to choose outsourcing-saving. (3) Given a water-saving mode, subsidy on investment cost is more effective for the government to achieve more environmental performance.Research limitations/implicationsFirst, subsidy endogeneity can be considered to explore the optimal interval for government subsidies to maximize social welfare. Second, in outsourcing-saving, other types of contract can be discussed. Another extension is about model uncertainties. Finally, other policies on improving water efficiency can be also examined.Practical implicationsThe paper includes implication for HWC manufacturers to select the best water-saving mode under subsidy, and it allows policymakers to understand the efficiency of proposed subsidies.Originality/valueDecisions on water-saving efforts, selection of water-saving modes and operational planning are also regarded as business strategies in the paper. Particularly, the influences of different government subsidies are also considered and compared.

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“…where Cost represents the investment cost not recovered by the WSSC from the time of interruption until contract expiration, and CV is the chance value of the WSSC continuing the WSMC. The evaluation of these values is mentioned in the literature (Hu et al 2021), and thus are not covered in this paper.…”

Section: Estimation Of the Consequences Of Project Interruptionmentioning

confidence: 99%

A risk assessment model of WSMC projects under emergencies

Wang

Guo

et al. 2021

Water Supply

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As a novel market-based water-saving mechanism, the Water Saving Management Contract (WSMC) project faces interruption risk caused by emergencies like the coronavirus disease-2019 (COVID-19) pandemic. An interruption risk assessment model of WSMC projects is established through a quantitative evaluation of the impact of emergencies on water users based on input-output theory. First, the concept of the interruption risk index (IRI) is defined as a function of the duration of enterprise shutdown (DES). Second, the DES is divided into two parts: the duration caused by COVID-19 and the that under other types of emergencies. Third, the risk tolerance threshold is given to estimate the interruption result, and its different consequences are discussed. Finally, a WSMC project in China is taken as a case study, and its interruption risks are analysed. The results show that the IRIs of this WSMC in both 2020 and 2021 are theoretically greater than the risk tolerance thresholds, and the high pandemic prevention standards and conservative pandemic estimates are the main reasons for the above results. The model established in this study provides a reference for WSMC participants to deal with emergencies and provides the theoretical support for the extension of the WSMC.

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A real option-based valuation model for Shared Water Saving Management Contract

Cited by 18 publications

References 27 publications

Exploring the Influence of Big Data Technology on the Innovation of the Enterprise Economic Management Mode

Exploring the Influence of Big Data Technology on the Innovation of the Enterprise Economic Management Mode

Impact of government subsidy on the optimal strategies of improving water use efficiency for a high-water-consumption manufacturer

A risk assessment model of WSMC projects under emergencies

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