Economic evaluation of data sets: A descriptive approach to determine the value of data sets in the context of digitalization and Industry 4.0, by describing the concept of the Real Option Theory

Abstract

The present work illustrates if the Real Option Theory can be applied to determine the value of data and data sets within a corporate environment. This thesis will present the key to digitalization strategies and its consequence in Industry 4.0. It will illustrate the necessity of a reliable data foundation and point out the investments which have to be made in order to maintain the information quality drawn from the data. Determining the value of these investments by applying traditional discounted cash flow methods is difficult, as they do not offer suitable approaches/measures to include uncertainty and flexibility into the investment. The Real Option Theory in general does provide this potential and is therefore more applicable. Accordingly, this work will introduce the concepts of the Real Option. Furthermore, it will link this concept to investment projects in data respectively data sets.