Methodology for Rapid Technology Valuation with Restricted Incomes

Abstract

The aim of this study is to present a rapid methodology to valuate the technology developed at R&D university institutions. The methodology is a variation of the classical Income method and is based on the calculation of total permutations obtained from the data of an array of highly punished yearly incomes expected for previously defined multi-scenarios and the statistical averaging of such permutations. The method is applied to valuate an energy saving technology device, in order to illustrate its process of implementation. This methodology results in a practical and useful method for obtaining a first monetary value for the technology which allows the realization of vital and rapid decision making in a global economic dynamic in which the speed and reliability in decision making is vital for the competitiveness. Final results of the presented case shown that the presented methodology can be adapted to be used to obtain a first monetary value for almost any field new technology products with promising commercial expectations, which could have many different application opportunities. It can be used for the R&D developers in order to obtain

A research and technology valuation model for decision analysis in the environmental and renewable energy sectors

“…There are numerous valuation models for R&D projects; unfortunately, many of them have considerable limitations [17]. This paper presents a comprehensive and robust ARDV model that displays easily interpreted graphic results.…”

“…Another benefit of our model is that it includes programs that enable managers to carry out sensibility analysis, as shown in Figure 7. Combined, these advantages enable managers and project managers to use this new model to define clear and measurable targets and gauge the impact of decision making on project progressovercoming one of the main limitations of the classical NPV model [8,17].…”

“…While other models focus only on one endpoint-the commercialization of the technology under development [13,17,18]-the literature generally agrees that the best way to value and manage R&D projects is to divide projects into different stages [19]. This approach helps to reduce risks and hedge uncertainty.…”

“…As specified by Managi [20], the paths taken by R&D projects are highly variable; thus, models need to be flexible enough to consider various scenarios, while remaining reliable, understandable and efficient. Another important characteristic of an R&D valuation model is that, in addition to technology risks, it must also consider market risks [17].…”

“…In order to select an appropriate model, certain experts suggest that the choice should depend on the intended final users. For example, some authors affirm that DCF is preferred by practitioners, while RO is more useful for early stage projects [17].…”