The Real Options Calculator (ROC) guides you through a complete, professional round trip for designing, evaluating, and optimizing your innovation or transformation projects. Here’s how a typical project flows through the tool:

1. Define Project Parameters

Begin by entering essential financial settings for your project:

• Go to Edit > Project Settings
• Input WACC (Weighted Average Cost of Capital), rf (risk-free rate), and Currency

2. Structure Your Project

Build the project tree to reflect each stage, milestone, or decision point:

• Right-click on a project step to add, edit, or remove steps
• Map out the sequence of actions and uncertainties

3. Detail Each Step

For every step in your project:

• Specify duration, required investment, probabilities of outcomes, and expected Free Cash-Flow (FCF)
• Left-click a step to open its detailed parameters

4. Estimate Scenario Outcomes

Use the built-in estimator to model different financial outcomes:

• Click ‘Estimate FCF’ to input assumptions and calculate projected cash flows for each scenario

5. Calculate Real Option Values

Quantify the value of flexibility and staged investment:

• Click the ‘Real Options’ button to compute Net Real Option values for each step

6. Review and Export Results

• Visualize Real Options values directly on the project tree
• Hover for tooltips with detailed values
• Use ‘Copy to Clipboard’ or File > Save to export your results

7. Iterate and Optimize

• Adjust assumptions, project structure, or parameters as needed
• Recalculate to compare scenarios and optimize your business case

Summary

This round trip enables you to:

• Rapidly design and evaluate complex projects
• Make informed, risk-aware investment decisions
• Communicate results clearly to all stakeholders

For more details, see our Project Design Guide or contact welcome@strategic-finance.eu.