Rating: 
Summary: Very Disappointing
Review: A very disappointing read. Although this book will explain the power of real options I feel it does a very poor job of explaining how to evaluate them. Additionally the book has errors in some of its examples and in more than one place is incorrect. (ie spread option analysis) In several places it gives some theoretical values with no explanation as to how they were reached. I would only recommend you read the 1st Chapter in each section, as subsequent chapters just repeat the material but with a different concept. Definitely not for the person looking for a book with some meat on it. (Incidently several of the 'real options' they identify in the book or completely outdated. ie The afore mentioned spread option. People haven't used the method they suggest for many years as its mathematically incorrect.)
Rating: 
Summary: Well-written outline, could use a little more quants..
Review: Amram and Kulatilaka have produced an excellent overview of the real options theory and practical application. The book helps recognize real options by giving lots of examples and provides with a clear description of a "four step solution proces". Yet, the book could do with a little more attention on the quants, especially in the examples. E.g. chapter 13 on Drug development states that "it was found that a drug (..) had a value of $14.6 mln using the real options approach". That's fine with me, but how exactly did you calculate that ?
Rating:
Summary: A practical rather than theoretical guide
Review: At last, a book about options with fewer equations than case studies of real applications. Too many other books on this vital topic concentrate on the theory which is very mathematical and arcane. This fails to reach the audience who most need Option thinking: the general manager who has to make strategic decisions in an uncertain environment. This book addreses the general manager through case studies shorn of obscure and unnecessary detail. I would recommend this book for a general audience as an introduction to option thinking. But the book is uneven in tone (though it is structured so readers can skip the less relevant parts). Its biggest weakness may be when it comes to talk about how to calculate option values. It is still to dismissive of simulation (and wrong on some technical limitations) and too attached to traditional methods such as "binomial trees" and formulae like Black Scholes. The book (perhaps uniquely in the options literature) stresses the importance of communicating results and their rationale to decision makers: if you can't explain the analysis, you won't change decision-makers minds. But traditional calculation methods are part of the problem. We need calculational methods that are transparent and provide insight not just analysis. For option thinking insight is far more important than precision.
Rating: 
Summary: Not a practitioner's guide
Review: For me, the book was verbose, repetitive, poorly organized. Not inspiring and not recommended.
Rating: 
Summary: A roadmap for decision-makers
Review: I face difficult decisions every day -- the underlying information on which to base any of my decisions is often incomplete or uncertain. Some such decisions, e.g. structuring the terms of a licensing agreement, often draw upon industry-standard metrics of evaluation... but in reality both sides are looking into a crystal ball, weighing our risks against the possibility of success. It is an uncomfortable state; blunders can be costly -- as can be lost opportunities. Amram and Kulatilaka have put together a masterful roadmap for evaluating uncertainty -- one which can even clarify "gut-feelings". "Real Options: Managing Strategic Investment in an Uncertain World" was particularly easy to read because of the many examples provided. They wrote this as a handbook for decision-makers, the managers and licensing executives who up to their eyeballs in choices, negotiations, and deals -- its not just a textbook for economics graduate students. Interestingly, I found the Real Options strategies applied to decision-making outside the envelope of license negotiations. I use this strategy to value my investment of time and resources in a variety of projects where uncertainty often seems to be the overiding variable. Yes, risk and uncertainty are part of real life -- they sure can make your stomach hurt. Real Options can help you find your path and ease the stomach-pain of choosing.
Rating:
Summary: Don't buy this book
Review: If you are interested in learning about how to conduct option analysis, this is not the book for you. The book never provides you with the details on how to conduct the valuations described in the examples. Instead, they use over 100 pages to reiterate the same points they describe in the first 5. Furthermore, there are plenty of mistakes in the text to add to your confusion. In short, this book is a waste of time and money.
Rating:
Summary: The authors lost an unique opportunity
Review: It is a cristal clear and an excelent first step-book. However, in many of the examples is not clear where the number came from. Inclusive, if you dowload the spreadsheet ...................... There are also some logical errors in the examples which cause the impresion that the authors want to over-sale the concept, and the lack of a clear logic explanation produce clear mistakes in some of the examples. Is not a quantitative book and please do not tried to use real options after read this book, it will be great if first you have a robust background in derivatives.
Rating: 
Summary: Clear Book, some examples are not explained
Review: It is a cristal clear and an excelent first step-book. However, in many of the examples is not clear where the number came from. Inclusive, if you dowload the spreadsheet ...................... There are also some logical errors in the examples which cause the impresion that the authors want to over-sale the concept, and the lack of a clear logic explanation produce clear mistakes in some of the examples. Is not a quantitative book and please do not tried to use real options after read this book, it will be great if first you have a robust background in derivatives.
Rating:
Summary: Good introductory real options book for beginner or manager
Review: It is a good introductory book on real options targeted at the audience of managers rather than experienced financial practitioners. Its contents covered financial options, binomial pricing and Black-Scholes model where the last ten chapters or so are case studies dedicated to applications of real options where it gives readers an idea how real options can be applied in diverse industries. It makes a good and easy read for anyone who wants a quick flavor of real options without going through too much of the horrible maths that derivatives and real options seems to have !
I personally enjoy reading it from cover to cover.
Rating:
Summary: ECommerce needs a Real Options investment approach!
Review: Many investments in ECommerce have been postponed because management required facts about the future - which do not exist - to fit into their ROI models and mindsets. Well the Real-Options approach helps managers create business cases using the market which will validate action. We have been postponing the future, particularly in ECommerce investments for too long and this is a very important new tool in the arsenal for action! So now there will be few excuses to postpone investments today which create options for tomorrow. If you don't sow you can't expect to reap the harvest.
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