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Risk and the Economic Value of the Software Producer

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Value-Based Software Engineering

Abstract:

The economic worth of a commercial organization is a function of the present value of its future profits, discounted for both time and risk. Consequently, the economic value of a software firm is greatly affected by the predictability of the organization’s software development projects, since unpredictable projects warrant large risk premiums. We can quantitatively approximate the value of increased predictability, and evaluate the effectiveness of efforts, such as process improvement, to improve the predictability of software development projects.

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Author information

Authors and Affiliations

  1. Portland State University, 1825 SW Broadway, 97207, Portland, OR, USA

    Warren Harrison

Authors
  1. Warren Harrison
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Editor information

Editors and Affiliations

  1. Institute for Software Technology, Vienna University of Technology, Karlsplatz 13, 1040, Wien, Austria

    Stefan Biffl

  2. School of Information Systems, Technology and Management, University of New South Wales, Sydney, NSW, 2052, Australia

    Aybüke Aurum

  3. Center for Software Engineering, University of Southern California, 941 W 37th Place, Los Angeles, CA, 90089-0781, USA

    Barry Boehm

  4. Software Engineering NRC Institute for Information Technology, National Research Council Canada, Building M50, 1200 Montreal Rd., Ottawa, ON, Canada, K1A 0R6

    Hakan Erdogmus

  5. Systems Engineering & Automation, Johannes Kepler University Linz, Altenbergerstr. 69, 4040, Linz, Austria

    Paul Grünbacher

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© 2006 Springer-Verlag Berlin Heidelberg

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Harrison, W. (2006). Risk and the Economic Value of the Software Producer. In: Biffl, S., Aurum, A., Boehm, B., Erdogmus, H., Grünbacher, P. (eds) Value-Based Software Engineering. Springer, Berlin, Heidelberg. https://doi.org/10.1007/3-540-29263-2_5

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  • DOI: https://doi.org/10.1007/3-540-29263-2_5

  • Publisher Name: Springer, Berlin, Heidelberg

  • Print ISBN: 978-3-540-25993-0

  • Online ISBN: 978-3-540-29263-0

  • eBook Packages: Computer ScienceComputer Science (R0)

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