Wharton@Work — September 2008

Wharton School Publishing

Unlocking Opportunities for Growth

Unlocking Opportunities for Growth
Most companies do not have a good process for addressing uncertainty in their investment decisions. Managers analyze investments using tools that bias them against real innovation and lead them to avoid their best opportunities. In a new book, Unlocking Opportunities for Growth: How to Profit from Uncertainty While Limiting Your Risk, Alexander van Putten and Ian MacMillan, who teach in Wharton's Advanced Management Program, present a framework for "Opportunity Engineering" to make better investments in the face of uncertainty.

Drawing upon recent advances in financial analysis, but without requiring a lot of math, the authors show how to engineer the risk out of uncertain opportunities so that you can pursue more high-payoff innovations. They show how to escape from the "go/no-go vise" and implement more flexible decision-making that considers all the business alternatives, models, and opportunities associated with each project. You'll learn how to systematically structure high-potential projects to limit downside exposure and boost your potential upside.

The authors show how to define the scope of investment opportunities, identify key drivers of potential profits, document assumptions, design out major risks, and tease out key challenges and vulnerabilities. Using these techniques, they show how readers can escape the mindset that limits their investments to low-impact innovations and begin pursuing serious growth opportunities.

Download the first chapter for free.

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