An Assessment of Flexibility Concepts and Their Practical Usefulness to Decision Modelling

The idea of flexibility appears in many disciplines. It refers to having or offering many different choices or functions. Flexibility is a way of dealing with uncertainty. In spite of its popularity, flexibility has not received the formal recognition worthy of mature and well-defined concepts like optimality or profitability. Its usefulness may have been overlooked, particularly its potential contribution to aspects of modelling that are not well served by existing ideas. For example, many types of uncertainties in large-scale and long term investment planning are inadequately treated by standard optimisation techniques. This paper invites a fresh approach to uncertainty modelling by use of flexibility concepts from a decision analysis perspective.