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Engineering Tripos Part IIB, 4D16: Construction Management (shared with IIA), 2023-24

Leader

Prof I Brilakis

Lecturers

Dr I Brilakis

Lecturers

Dr Brian Sheil

Timing and Structure

Mich term - 16 lectures, including 2 examples classes (note: available to 3rd year students as a Shared Module in Part IIA). Assessment 100% exam

Aims

The aims of the course are to:

  • familiarize students with concepts and methods used to manage construction projects and companies
  • cover legal, safety and health matters relevant to construction
  • cover risk management generally, so far as is possible in time allocated

Objectives

As specific objectives, by the end of the course students should be able to:

  • have a broad understanding of how construction projects are initiated and driven forward
  • appreciate the roles and responsibilities of the various professionals involved in design and construction
  • understand the basics of lean construction
  • understand the key issues in managing a construction business
  • have some knowledge of the regulations covering construction
  • have some knowledge of forms of contract and of law relevant to construction
  • appreciate the importance of health and safety in construction and the related regulations and if risk managment generally
  • understand something of costing and financial aspects of construction
  • have experience of critical study of at least one construction project

Content

This module aims to familiarize students with concepts and methods used to manage construction projects and companies. These include methods for planning operations; improving productivity; controlling budgets, cash flow, and costs; safety; procurement; contracting law; preparing tenders and bidding; company organization and structure; and risk planning.

Booklists

Please see the Booklist for Group D Courses for references for this module.

Examination Guidelines

Please refer to Form & conduct of the examinations.

UK-SPEC

This syllabus contributes to the following areas of the UK-SPEC standard:

Toggle display of UK-SPEC areas.

GT1

Develop transferable skills that will be of value in a wide range of situations. These are exemplified by the Qualifications and Curriculum Authority Higher Level Key Skills and include problem solving, communication, and working with others, as well as the effective use of general IT facilities and information retrieval skills. They also include planning self-learning and improving performance, as the foundation for lifelong learning/CPD.

IA1

Apply appropriate quantitative science and engineering tools to the analysis of problems.

IA2

Demonstrate creative and innovative ability in the synthesis of solutions and in formulating designs.

KU1

Demonstrate knowledge and understanding of essential facts, concepts, theories and principles of their engineering discipline, and its underpinning science and mathematics.

KU2

Have an appreciation of the wider multidisciplinary engineering context and its underlying principles.

D2

Understand customer and user needs and the importance of considerations such as aesthetics.

D3

Identify and manage cost drivers.

S1

The ability to make general evaluations of commercial risks through some understanding of the basis of such risks.

S2

Extensive knowledge and understanding of management and business practices, and their limitations, and how these may be applied appropriately to strategic and tactical issues.

S4

Awareness of the framework of relevant legal requirements governing engineering activities, including personnel, health, safety, and risk (including environmental risk) issues.

S5

Understanding of the need for a high level of professional and ethical conduct in engineering.

P3

Understanding of contexts in which engineering knowledge can be applied (e.g. operations and management, technology, development, etc).

P5

Awareness of nature of intellectual property and contractual issues.

P6

Understanding of appropriate codes of practice and industry standards.

US3

An understanding of concepts from a range of areas including some outside engineering, and the ability to apply them effectively in engineering projects.

 
Last modified: 03/09/2023 14:40

Engineering Tripos Part IIB, 4D16: Construction Management (shared with IIA), 2024-25

Leader

Dr B Sheil

Lecturers

Dr B Sheil

Timing and Structure

Mich term - 16 lectures, including 2 examples classes (note: available to 3rd year students as a Shared Module in Part IIA). Assessment 100% exam

Aims

The aims of the course are to:

  • familiarize students with concepts and methods used to manage construction projects and companies
  • cover legal, safety and health matters relevant to construction
  • cover risk management generally, so far as is possible in time allocated

Objectives

As specific objectives, by the end of the course students should be able to:

  • have a broad understanding of how construction projects are initiated and driven forward
  • appreciate the roles and responsibilities of the various professionals involved in design and construction
  • understand the basics of lean construction
  • understand the key issues in managing a construction business
  • have some knowledge of the regulations covering construction
  • have some knowledge of forms of contract and of law relevant to construction
  • appreciate the importance of health and safety in construction and the related regulations and if risk managment generally
  • understand something of costing and financial aspects of construction
  • have experience of critical study of at least one construction project

Content

This module aims to familiarize students with concepts and methods used to manage construction projects and companies. These include methods for planning operations; improving productivity; controlling budgets, cash flow, and costs; safety; procurement; contracting law; preparing tenders and bidding; company organization and structure; and risk planning.

Booklists

Please see the Booklist for Group D Courses for references for this module.

Examination Guidelines

Please refer to Form & conduct of the examinations.

UK-SPEC

This syllabus contributes to the following areas of the UK-SPEC standard:

Toggle display of UK-SPEC areas.

GT1

Develop transferable skills that will be of value in a wide range of situations. These are exemplified by the Qualifications and Curriculum Authority Higher Level Key Skills and include problem solving, communication, and working with others, as well as the effective use of general IT facilities and information retrieval skills. They also include planning self-learning and improving performance, as the foundation for lifelong learning/CPD.

IA1

Apply appropriate quantitative science and engineering tools to the analysis of problems.

IA2

Demonstrate creative and innovative ability in the synthesis of solutions and in formulating designs.

KU1

Demonstrate knowledge and understanding of essential facts, concepts, theories and principles of their engineering discipline, and its underpinning science and mathematics.

KU2

Have an appreciation of the wider multidisciplinary engineering context and its underlying principles.

D2

Understand customer and user needs and the importance of considerations such as aesthetics.

D3

Identify and manage cost drivers.

S1

The ability to make general evaluations of commercial risks through some understanding of the basis of such risks.

S2

Extensive knowledge and understanding of management and business practices, and their limitations, and how these may be applied appropriately to strategic and tactical issues.

S4

Awareness of the framework of relevant legal requirements governing engineering activities, including personnel, health, safety, and risk (including environmental risk) issues.

S5

Understanding of the need for a high level of professional and ethical conduct in engineering.

P3

Understanding of contexts in which engineering knowledge can be applied (e.g. operations and management, technology, development, etc).

P5

Awareness of nature of intellectual property and contractual issues.

P6

Understanding of appropriate codes of practice and industry standards.

US3

An understanding of concepts from a range of areas including some outside engineering, and the ability to apply them effectively in engineering projects.

 
Last modified: 31/05/2024 10:04

Engineering Tripos Part IIB, 4D16: Construction Management (shared with IIA), 2022-23

Leader

Prof I Brilakis

Lecturers

Dr I Brilakis

Lecturers

Dr Brian Sheil

Timing and Structure

Mich term - 16 lectures, including 2 examples classes (note: available to 3rd year students as a Shared Module in Part IIA). Assessment 100% exam

Aims

The aims of the course are to:

  • familiarize students with concepts and methods used to manage construction projects and companies
  • cover legal, safety and health matters relevant to construction
  • cover risk management generally, so far as is possible in time allocated

Objectives

As specific objectives, by the end of the course students should be able to:

  • have a broad understanding of how construction projects are initiated and driven forward
  • appreciate the roles and responsibilities of the various professionals involved in design and construction
  • understand the basics of production management techniques
  • understand the key issues in managing a construction business
  • have some knowledge of the regulations covering construction
  • have some knowledge of forms of contract and of law relevant to construction
  • appreciate the importance of health and safety in construction and the related regulations and if risk managment generally
  • understand something of costing and financial aspects of construction
  • have experience of critical study of at least one construction project

Content

This module aims to familiarize students with concepts and methods used to manage construction projects and companies. These include methods for planning operations; improving productivity; controlling budgets, cash flow, and costs; safety; procurement; contracting law; preparing tenders and bidding; company organization and structure; and risk planning.

Booklists

Please see the Booklist for Group D Courses for references for this module.

Examination Guidelines

Please refer to Form & conduct of the examinations.

UK-SPEC

This syllabus contributes to the following areas of the UK-SPEC standard:

Toggle display of UK-SPEC areas.

GT1

Develop transferable skills that will be of value in a wide range of situations. These are exemplified by the Qualifications and Curriculum Authority Higher Level Key Skills and include problem solving, communication, and working with others, as well as the effective use of general IT facilities and information retrieval skills. They also include planning self-learning and improving performance, as the foundation for lifelong learning/CPD.

IA1

Apply appropriate quantitative science and engineering tools to the analysis of problems.

IA2

Demonstrate creative and innovative ability in the synthesis of solutions and in formulating designs.

KU1

Demonstrate knowledge and understanding of essential facts, concepts, theories and principles of their engineering discipline, and its underpinning science and mathematics.

KU2

Have an appreciation of the wider multidisciplinary engineering context and its underlying principles.

D2

Understand customer and user needs and the importance of considerations such as aesthetics.

D3

Identify and manage cost drivers.

S1

The ability to make general evaluations of commercial risks through some understanding of the basis of such risks.

S2

Extensive knowledge and understanding of management and business practices, and their limitations, and how these may be applied appropriately to strategic and tactical issues.

S4

Awareness of the framework of relevant legal requirements governing engineering activities, including personnel, health, safety, and risk (including environmental risk) issues.

S5

Understanding of the need for a high level of professional and ethical conduct in engineering.

P3

Understanding of contexts in which engineering knowledge can be applied (e.g. operations and management, technology, development, etc).

P5

Awareness of nature of intellectual property and contractual issues.

P6

Understanding of appropriate codes of practice and industry standards.

US3

An understanding of concepts from a range of areas including some outside engineering, and the ability to apply them effectively in engineering projects.

 
Last modified: 05/08/2022 10:22

Engineering Tripos Part IIB, 4D16: Construction Management (shared with IIA), 2018-19

Leader

Dr P B Heffernan

Lecturers

Dr P B Heffernan and Prof C R Middleton

Timing and Structure

Lent term - 16 lectures, including 1 examples class (note: available to 3rd year students as a Shared Module in Part IIA). Assessment 100% exam

Aims

The aims of the course are to:

  • familiarize students with concepts and methods used to manage construction projects and companies
  • cover legal, safety and health matters relevant to construction
  • cover risk management generally, so far as is possible in time allocated

Objectives

As specific objectives, by the end of the course students should be able to:

  • have a broad understanding of how construction projects are initiated and driven forward
  • appreciate the roles and responsibilities of the various professionals involved in design and construction
  • understand the basics of production management techniques
  • understand the key issues in managing a construction business
  • have some knowledge of the regulations covering construction
  • have some knowledge of forms of contract and of law relevant to construction
  • appreciate the importance of health and safety in construction and the related regulations and if risk managment generally
  • understand something of costing and financial aspects of construction
  • have experience of critical study of at least one construction project

Content

This module aims to familiarize students with concepts and methods used to manage construction projects and companies. These include methods for planning operations; improving productivity; controlling budgets, cash flow, and costs; safety; procurement; contracting law; preparing tenders and bidding; company organization and structure; and risk planning.

Booklists

Please see the Booklist for Group D Courses for references for this module.

Examination Guidelines

Please refer to Form & conduct of the examinations.

UK-SPEC

This syllabus contributes to the following areas of the UK-SPEC standard:

Toggle display of UK-SPEC areas.

GT1

Develop transferable skills that will be of value in a wide range of situations. These are exemplified by the Qualifications and Curriculum Authority Higher Level Key Skills and include problem solving, communication, and working with others, as well as the effective use of general IT facilities and information retrieval skills. They also include planning self-learning and improving performance, as the foundation for lifelong learning/CPD.

IA1

Apply appropriate quantitative science and engineering tools to the analysis of problems.

IA2

Demonstrate creative and innovative ability in the synthesis of solutions and in formulating designs.

KU1

Demonstrate knowledge and understanding of essential facts, concepts, theories and principles of their engineering discipline, and its underpinning science and mathematics.

KU2

Have an appreciation of the wider multidisciplinary engineering context and its underlying principles.

D2

Understand customer and user needs and the importance of considerations such as aesthetics.

D3

Identify and manage cost drivers.

S1

The ability to make general evaluations of commercial risks through some understanding of the basis of such risks.

S2

Extensive knowledge and understanding of management and business practices, and their limitations, and how these may be applied appropriately to strategic and tactical issues.

S4

Awareness of the framework of relevant legal requirements governing engineering activities, including personnel, health, safety, and risk (including environmental risk) issues.

S5

Understanding of the need for a high level of professional and ethical conduct in engineering.

P3

Understanding of contexts in which engineering knowledge can be applied (e.g. operations and management, technology, development, etc).

P5

Awareness of nature of intellectual property and contractual issues.

P6

Understanding of appropriate codes of practice and industry standards.

US3

An understanding of concepts from a range of areas including some outside engineering, and the ability to apply them effectively in engineering projects.

 
Last modified: 22/01/2019 11:55

Engineering Tripos Part IIB, 4I1: Strategic Valuation, 2023-24

Module Leader

Prof. H Jiang

Lecturer

Prof. H Jiang

Lab Leader

Prof. H Jiang

Timing and Structure

Christmas vacation - dates below; Assessment: Coursework 100% in project combining spreadsheet modelling, written analysis and a management-style report - details TBA. You may conduct some Excel modelling with fellow students. Michaelmas/Lent Term break.

Prerequisites

All participants are expected to be familiar with probability and statistics at the level of a final year high school or introductory undergraduate course. See the prerequisites document on the course website for details. Participants are also expected to be familiar with basic Excel spreadsheet modelling (see e.g., http://best-excel-tutorial.com/54-basics for a tutorial). The basic Excel functions and tasks that you must know how to use competently are: MAX, AVERAGE, COUNT, IF, SUMPRODUCT; mathematical formulas based on relative and absolute references; creating simple tables; and plotting pie, bar, column and line charts.

Aims

The aims of the course are to:

  • See below.

Objectives

As specific objectives, by the end of the course students should be able to:

  • See below.

Content

There will be an introduction session of the course on 6th October 2023.

  • Module Time: 3 full days (9.00am – 5.00pm) on 4th, 6th, and 8th December 2023.
  • Reserve 4th – 11th December 2023 for TPE25 ONLY.
  • Reserve 9th and 10th December 2023 for conducting part I of the course assessment.
  • Reserve a compulsory Q&A session for the course assessment on 11th December 2023.
  • It is necessary for you to have a Window-based or MacOS laptop for Excel modelling. There is a possibility that students use computers in the computer lab. If you do not have a laptop, be prepared to stay in Cambridge for a few more days after 11th December 2023 so that you can conduct Excel modelling in relation to your course assessment in the CJBS Computer Lab – subject to the availability of the lab.
  • The level of mathematical theory may be below the expectation of some CUED students.
This module introduces students to two essential and complementary ways of dealing with future uncertainties. On one hand, we have diversification, the notion that you should "not put all your eggs in one basket", is both intuitive and ubiquitous in modern management. This exemplifies passive risk management. On the other, we have the real options paradigm. This emphasises that future value depends both on unfolding uncertainties, which you cannot control, and the flexibility of your future responses. By investing in research and development projects, for example, companies buy the option to launch a product, which they may or may not exercise, depending on the level of success of the R and D effort and on market conditions at the time of launch. However, flexibility also costs money: R and D expenditure, for example in the biotech industry, can be huge. So how much flexibility shall we build into the system? This is the realm of project design for active risk management. System designers and project managers need tools that help them decide if added flexibility is worth the money. This course provides the students with a mindset and a suite of tools to tackle such problems.
 
The emphasis is on management and design of technological projects. Examples and case studies will illustrate how theory can be adapted to actual conditions.
 
Please note that the number of places available to Part IIB Engineers is limited.  A ballot will be held if the module looks likely to be oversubscribed.  The ballot will take place on the first day of lectures, after which the Teaching Office will be in touch with any unsuccessful applicants to ask them to select another module.

Day 1: Foundations

  • Course aims and objectives
  • Review of traditional project valuation
  • System value is a shape, not a number
  • Monte Carlo Simulation
  • (Valuing flexibility)

Preparatory reading:

  • de Neufville, R. and Scholtes, S. (2011), Ch 2: "Recognition of Uncertainty".
  • If you have not seen Net Present Value (NPV) or Discounted Cash Flows before, read Brealey and Meyers, Ch. 2: ‘Present values’.

 

Day 2: Portfolio Thinking

  • Diversification
  • Hedging
  • Trading off risk against return

Preparatory reading:

Day 3: Real Options Analysis

  • Flexibility: Intuition behind real options
  • Lattice valuations

Preparatory reading:

  • Brealey and Meyers, Ch. 10: ‘Project Analysis’, Ch. 20: ‘Understanding Options’ [For the 9th edition, use Ch. 11, Ch. 21]
  • de Neufville and Scholtes (2011), Ch. I: ‘High Level Overview’ (pp. 1-39)

Further notes

Required software

The basic modelling tool will be Microsoft Excel. Essential add-ins include Analysis ToolPak and Solver, both of which come with Excel but may require the Excel installation disks, and @Risk, which will be distributed to you.

Coursework

Coursework Format

Due date

& marks

100% individual project combining spreadsheet modelling, written analysis and a management-style report. The coursework consists of two parts: Task I (65%-70%) and Task II (30%-35%).

Task I contains a number of subtasks, in which students are asked to conduct intensive Excel modelling, to answer questions, to provide analysis, and to give intuitive business interpretations. 

Task II is a short presentation and is assessed by a set of criteria: intuition (business implication), prioritising information (structure), clarity and use of visual aids such as charts and graphs, and language.

Individually Assessed

Answer Sheet, Presentation Document and Excel Files

Anonymously marked

The coursework will be carried out during Michaelmas/Lent term break and will be submitted right before the beginning of the Lent term in January 2024.

Marks will be available in three-four weeks after the submission date.

 

Booklists

Please refer to the Booklist for Part IIB Courses for references to this module, this can be found on the associated Moodle course.

Module Webpage

To be advised: https://www.vle.cam.ac.uk

TPE25 Strategic Valuation

Reference Books

The following are available in multiple copies in the Judge Business School Information Centre:

 

de Neufville, R. and Scholtes, S. (2011)

Flexibility in Engineering Design. Cambridge, MA: MIT Press

E-book: https://ebookcentral.proquest.com/lib/CAM/detail.action?pq-origsite=prim... 

 

Printed book at:

TA174.D46 2011

Brealey, R. A, Myers, S. C. and Allen, F. (2019)

 

or

Brealey, R. A, Myers, S. C. and Allen, F. (2008)

Principles of Corporate Finance. 13th ed. Boston, Mass.: Irwin McGraw Hill

 

 

 

9th ed.

 

 

N.B. For Brealey and Myers, any edition from 6th ed. onwards is fine.

 

Printed books at:

HG4026.B73 P7 2011

E-book: https://www.vlebooks.com/Vleweb/Product/Index/1993343?page=0 

 

 

 

HG4026.B73 P7 2008

 

 

Savage, S. L. (2003)

Decision Making with Insight. Belmont, CA: Brooks/Cole

Printed book at:

HF5548.4.S38 2003

 

Luenberger, D. G. (1998)

Investment Science. Oxford: Oxford University Press

Printed book at:

HG4515.2.L83

 

Examination Guidelines

Please refer to Form & conduct of the examinations.

UK-SPEC

This syllabus contributes to the following areas of the UK-SPEC standard:

Toggle display of UK-SPEC areas.

GT1

Develop transferable skills that will be of value in a wide range of situations. These are exemplified by the Qualifications and Curriculum Authority Higher Level Key Skills and include problem solving, communication, and working with others, as well as the effective use of general IT facilities and information retrieval skills. They also include planning self-learning and improving performance, as the foundation for lifelong learning/CPD.

IA1

Apply appropriate quantitative science and engineering tools to the analysis of problems.

IA2

Demonstrate creative and innovative ability in the synthesis of solutions and in formulating designs.

KU1

Demonstrate knowledge and understanding of essential facts, concepts, theories and principles of their engineering discipline, and its underpinning science and mathematics.

KU2

Have an appreciation of the wider multidisciplinary engineering context and its underlying principles.

S1

The ability to make general evaluations of commercial risks through some understanding of the basis of such risks.

S2

Extensive knowledge and understanding of management and business practices, and their limitations, and how these may be applied appropriately to strategic and tactical issues.

E1

Ability to use fundamental knowledge to investigate new and emerging technologies.

E3

Ability to apply mathematical and computer based models for solving problems in engineering, and the ability to assess the limitations of particular cases.

P3

Understanding of contexts in which engineering knowledge can be applied (e.g. operations and management, technology, development, etc).

P8

Ability to apply engineering techniques taking account of a range of commercial and industrial constraints.

US1

A comprehensive understanding of the scientific principles of own specialisation and related disciplines.

US3

An understanding of concepts from a range of areas including some outside engineering, and the ability to apply them effectively in engineering projects.

 
Last modified: 14/08/2023 11:37

Engineering Tripos Part IIB, 4I1: Strategic Valuation, 2018-19

Module Leader

Dr H Jiang

Lecturer

Dr H Jiang

Lab Leader

Dr H Jiang

Timing and Structure

Christmas vacation - dates below; Assessment: Coursework 100% ind project combining spreadsheet modelling, written analysis and a management-style report - details TBA. You may conduct some Excel modelling with fellow students. Michaelmas/Lent Term break.

Prerequisites

All participants are expected to be familiar with probability and statistics at the level of a final year high school or introductory undergraduate course. See the prerequisites document on the course website for details. Participants are also expected to be familiar with basic Excel spreadsheet modelling (see e.g. http://best-excel-tutorial.com/54-basics for a tutorial). The basic Excel functions and tasks that you must know how to use competently are: MAX, AVERAGE, COUNT, IF, SUMPRODUCT; mathematical formulas based on relative and absolute references; creating simple tables; plotting pie, bar, column and line charts.

Aims

The aims of the course are to:

  • See below.

Objectives

As specific objectives, by the end of the course students should be able to:

  • See below.

Content

  • Module Time: 3 full days (9.00am – 5.00pm) on 3rd, 5th, and 7th December 2018.
  • Reserve 3rd  – 10th December 2018 for TPE25 only.
  • Reserve 8th and 10th December 2018 for conducting part I of the course assessment.
  • Reserve a compulsory Q&A session for the course assessment at 9am-11am on 10th December 2018.
  • It is useful for you to have a Window-based laptop for Excel modelling. If you do not have a laptop, be prepared to stay in Cambridge for a few more days after 10th December 2018 so that you can conduct Excel modelling in the CJBS Computer Lab.
  • The level of mathematical theory may be below the expectation of some CUED students.
This module introduces students to two essential and complementary ways of dealing with future uncertainties. On one hand, we have diversification, the notion that you should "not put all your eggs in one basket", is both intuitive and ubiquitous in modern management. This exemplifies passive risk management. On the other, we have the real options paradigm. This emphasises that future value depends both on unfolding uncertainties, which you cannot control, and the flexibility of your future responses. By investing in research and development projects, for example, companies buy the option to launch a product, which they may or may not exercise, depending on the level of success of the R and D effort and on market conditions at the time of launch. However, flexibility also costs money: R and D expenditure, for example in the biotech industry, can be huge. So how much flexibility shall we build into the system? This is the realm of project design for active risk management. System designers and project managers need tools that help them decide if added flexibility is worth the money. This course provides the students with a mindset and a suite of tools to tackle such problems.
 
The emphasis is on management and design of technological projects. Examples and case studies will illustrate how theory can be adapted to actual conditions.
 
Please note that the number of places available to Part IIB Engineers is limited.  A ballot will be held if the module looks likely to be oversubscribed.  The ballot will take place on the first day of lectures, after which the Teaching Office will be in touch with any unsuccessful applicants to ask them to select another module.

Day 1: Foundations

  • Course aims and objectives
  • Review of traditional project valuation
  • System value is a shape, not a number
  • Monte Carlo Simulation
  • (Valuing flexibility)

Preparatory reading:

  • Savage (2003), Ch. 2: ‘The building blocks of uncertainty: random variables’, Ch. 3: ‘The buildings of uncertainty: functions of random variables’.
  • If you have not seen Net Present Value (NPV) or Discounted Cash Flows before, read Brealey and Meyers, Ch. 2: ‘Present values’

 

Day 2: Portfolio Thinking

  • Diversification
  • Hedging
  • Trading off risk against return

Preparatory reading:

Day 3: Real Options Analysis

  • Flexibility: Intuition behind real options
  • Lattice valuations

Preparatory reading:

  • Brealey and Meyers, Ch. 10: ‘Project Analysis’, Ch. 20: ‘Understanding Options’ [For the 9th edition, use Ch. 11, Ch. 21]
  • de Neufville and Scholtes (2011), Ch. I: ‘High Level Overview’ (pp. 1-39)

Further notes

Required software

The basic modelling tool will be Microsoft Excel. Essential add-ins include Analysis ToolPak and Solver, both of which come with Excel but may require the Excel installation disks, and @Risk, which will be distributed to you.

Coursework

Coursework Format

Due date

& marks

100% individual project combining spreadsheet modelling, written analysis and a management-style report. The coursework consists of two parts: Task I (65%-70%) and Task II (30%-35%).

Task I contains a number of subtasks, in which students are asked to conduct intensive Excel modelling, to answer questions, to provide analysis, and to give intuitive business interpretations. 

Task II is a short presentation and is assessed by a set of criteria: intuition (business implication), prioritising information (structure), clarity and use of visual aids such as charts and graphs, and language.

Individually Assessed

Answer Sheet, Presentation Document and Excel Files

anonymously marked

The coursework will be carried out during Michaelmas/Lent term break and will be submitted right before the beginning of the Lent term in January 2019.

Marks will be available in three-four weeks after the submission date.

 

Booklists

Please see the Booklist for Group I Courses for references for this module.

Module Webpage

To be advised: https://www.vle.cam.ac.uk/course/view.php?id=83341

TPE6 Strategic Valuation

Reference Books

The following are available in multiple copies in the Judge Business School Information Centre:

 

de Neufville, R. and Scholtes, S. (2011)

Flexibility in Engineering Design. Cambridge, MA: MIT Press

E-book via Dawsonera (Click on ‘institutional login’)

 

Printed book at:

TA174.D46 2011

Brealey, R. A, Myers, S. C. and Allen, F. (2011)

 

or

Brealey, R. A, Myers, S. C. and Allen, F. (2008)

Principles of Corporate Finance. 10th ed. Boston, Mass.: Irwin McGraw Hill

 

 

 

9th ed.

 

 

N.B. For Brealey and Myers, any edition from 6th ed. onwards is fine.

 

Printed books at:

HG4026.B73 P7 2011

 

 

 

HG4026.B73 P7 2008

 

 

Savage, S. L. (2003)

Decision Making with Insight. Belmont, CA: Brooks/Cole

Printed book at:

HF5548.4.S38 2003

 

Luenberger, D. G. (1998)

Investment Science. Oxford: Oxford University Press

Printed book at:

HG4515.2.L83

 

Examination Guidelines

Please refer to Form & conduct of the examinations.

UK-SPEC

This syllabus contributes to the following areas of the UK-SPEC standard:

Toggle display of UK-SPEC areas.

GT1

Develop transferable skills that will be of value in a wide range of situations. These are exemplified by the Qualifications and Curriculum Authority Higher Level Key Skills and include problem solving, communication, and working with others, as well as the effective use of general IT facilities and information retrieval skills. They also include planning self-learning and improving performance, as the foundation for lifelong learning/CPD.

IA1

Apply appropriate quantitative science and engineering tools to the analysis of problems.

IA2

Demonstrate creative and innovative ability in the synthesis of solutions and in formulating designs.

KU1

Demonstrate knowledge and understanding of essential facts, concepts, theories and principles of their engineering discipline, and its underpinning science and mathematics.

KU2

Have an appreciation of the wider multidisciplinary engineering context and its underlying principles.

S1

The ability to make general evaluations of commercial risks through some understanding of the basis of such risks.

S2

Extensive knowledge and understanding of management and business practices, and their limitations, and how these may be applied appropriately to strategic and tactical issues.

E1

Ability to use fundamental knowledge to investigate new and emerging technologies.

E3

Ability to apply mathematical and computer based models for solving problems in engineering, and the ability to assess the limitations of particular cases.

P3

Understanding of contexts in which engineering knowledge can be applied (e.g. operations and management, technology, development, etc).

P8

Ability to apply engineering techniques taking account of a range of commercial and industrial constraints.

US1

A comprehensive understanding of the scientific principles of own specialisation and related disciplines.

US3

An understanding of concepts from a range of areas including some outside engineering, and the ability to apply them effectively in engineering projects.

 
Last modified: 31/05/2018 19:32

Engineering Tripos Part IIB, 4I1: Strategic Valuation, 2022-23

Module Leader

Prof. H Jiang

Lecturer

Prof. H Jiang

Lab Leader

Prof. H Jiang

Timing and Structure

Christmas vacation - dates below; Assessment: Coursework 100% in project combining spreadsheet modelling, written analysis and a management-style report - details TBA. You may conduct some Excel modelling with fellow students. Michaelmas/Lent Term break.

Prerequisites

All participants are expected to be familiar with probability and statistics at the level of a final year high school or introductory undergraduate course. See the prerequisites document on the course website for details. Participants are also expected to be familiar with basic Excel spreadsheet modelling (see e.g., http://best-excel-tutorial.com/54-basics for a tutorial). The basic Excel functions and tasks that you must know how to use competently are: MAX, AVERAGE, COUNT, IF, SUMPRODUCT; mathematical formulas based on relative and absolute references; creating simple tables; and plotting pie, bar, column and line charts.

Aims

The aims of the course are to:

  • See below.

Objectives

As specific objectives, by the end of the course students should be able to:

  • See below.

Content

  • Module Time: 3 full days (9.00am – 5.00pm) on 5th, 7th, and 9th December 2022.
  • Reserve 5th – 12th December 2022 for TPE25 ONLY.
  • Reserve 10th and 11th December 2022 for conducting part I of the course assessment.
  • Reserve a compulsory Q&A session for the course assessment on 12th December 2022.
  • There is a possibility that this course will be delivered online depending on when the Covid19 social distancing rules will be removed. 
  • It is necessary for you to have a Window-based laptop for Excel modelling although it is possible that a Mac-based laptop can be used for Excel modelling. If this course is delivered in classroom and Cambridge, then there is a possibility that students use computers in the computer lab. In the latter, if you do not have a laptop, be prepared to stay in Cambridge for a few more days after 12th December 2022 so that you can conduct Excel modelling in relation to your course assessment in the CJBS Computer Lab – subject to availability of the lab.
  • The level of mathematical theory may be below the expectation of some CUED students.
This module introduces students to two essential and complementary ways of dealing with future uncertainties. On one hand, we have diversification, the notion that you should "not put all your eggs in one basket", is both intuitive and ubiquitous in modern management. This exemplifies passive risk management. On the other, we have the real options paradigm. This emphasises that future value depends both on unfolding uncertainties, which you cannot control, and the flexibility of your future responses. By investing in research and development projects, for example, companies buy the option to launch a product, which they may or may not exercise, depending on the level of success of the R and D effort and on market conditions at the time of launch. However, flexibility also costs money: R and D expenditure, for example in the biotech industry, can be huge. So how much flexibility shall we build into the system? This is the realm of project design for active risk management. System designers and project managers need tools that help them decide if added flexibility is worth the money. This course provides the students with a mindset and a suite of tools to tackle such problems.
 
The emphasis is on management and design of technological projects. Examples and case studies will illustrate how theory can be adapted to actual conditions.
 
Please note that the number of places available to Part IIB Engineers is limited.  A ballot will be held if the module looks likely to be oversubscribed.  The ballot will take place on the first day of lectures, after which the Teaching Office will be in touch with any unsuccessful applicants to ask them to select another module.

Day 1: Foundations

  • Course aims and objectives
  • Review of traditional project valuation
  • System value is a shape, not a number
  • Monte Carlo Simulation
  • (Valuing flexibility)

Preparatory reading:

  • de Neufville, R. and Scholtes, S. (2011), Ch 2: "Recognition of Uncertainty".
  • If you have not seen Net Present Value (NPV) or Discounted Cash Flows before, read Brealey and Meyers, Ch. 2: ‘Present values’.

 

Day 2: Portfolio Thinking

  • Diversification
  • Hedging
  • Trading off risk against return

Preparatory reading:

Day 3: Real Options Analysis

  • Flexibility: Intuition behind real options
  • Lattice valuations

Preparatory reading:

  • Brealey and Meyers, Ch. 10: ‘Project Analysis’, Ch. 20: ‘Understanding Options’ [For the 9th edition, use Ch. 11, Ch. 21]
  • de Neufville and Scholtes (2011), Ch. I: ‘High Level Overview’ (pp. 1-39)

Further notes

Required software

The basic modelling tool will be Microsoft Excel. Essential add-ins include Analysis ToolPak and Solver, both of which come with Excel but may require the Excel installation disks, and @Risk, which will be distributed to you.

Coursework

Coursework Format

Due date

& marks

100% individual project combining spreadsheet modelling, written analysis and a management-style report. The coursework consists of two parts: Task I (65%-70%) and Task II (30%-35%).

Task I contains a number of subtasks, in which students are asked to conduct intensive Excel modelling, to answer questions, to provide analysis, and to give intuitive business interpretations. 

Task II is a short presentation and is assessed by a set of criteria: intuition (business implication), prioritising information (structure), clarity and use of visual aids such as charts and graphs, and language.

Individually Assessed

Answer Sheet, Presentation Document and Excel Files

Anonymously marked

The coursework will be carried out during Michaelmas/Lent term break and will be submitted right before the beginning of the Lent term in January 2023.

Marks will be available in three-four weeks after the submission date.

 

Booklists

Please refer to the Booklist for Part IIB Courses for references to this module, this can be found on the associated Moodle course.

Module Webpage

To be advised: https://www.vle.cam.ac.uk

TPE25 Strategic Valuation

Reference Books

The following are available in multiple copies in the Judge Business School Information Centre:

 

de Neufville, R. and Scholtes, S. (2011)

Flexibility in Engineering Design. Cambridge, MA: MIT Press

E-book: https://ebookcentral.proquest.com/lib/CAM/detail.action?pq-origsite=prim... 

 

Printed book at:

TA174.D46 2011

Brealey, R. A, Myers, S. C. and Allen, F. (2019)

 

or

Brealey, R. A, Myers, S. C. and Allen, F. (2008)

Principles of Corporate Finance. 13th ed. Boston, Mass.: Irwin McGraw Hill

 

 

 

9th ed.

 

 

N.B. For Brealey and Myers, any edition from 6th ed. onwards is fine.

 

Printed books at:

HG4026.B73 P7 2011

E-book: https://www.vlebooks.com/Vleweb/Product/Index/1993343?page=0 

 

 

 

HG4026.B73 P7 2008

 

 

Savage, S. L. (2003)

Decision Making with Insight. Belmont, CA: Brooks/Cole

Printed book at:

HF5548.4.S38 2003

 

Luenberger, D. G. (1998)

Investment Science. Oxford: Oxford University Press

Printed book at:

HG4515.2.L83

 

Examination Guidelines

Please refer to Form & conduct of the examinations.

UK-SPEC

This syllabus contributes to the following areas of the UK-SPEC standard:

Toggle display of UK-SPEC areas.

GT1

Develop transferable skills that will be of value in a wide range of situations. These are exemplified by the Qualifications and Curriculum Authority Higher Level Key Skills and include problem solving, communication, and working with others, as well as the effective use of general IT facilities and information retrieval skills. They also include planning self-learning and improving performance, as the foundation for lifelong learning/CPD.

IA1

Apply appropriate quantitative science and engineering tools to the analysis of problems.

IA2

Demonstrate creative and innovative ability in the synthesis of solutions and in formulating designs.

KU1

Demonstrate knowledge and understanding of essential facts, concepts, theories and principles of their engineering discipline, and its underpinning science and mathematics.

KU2

Have an appreciation of the wider multidisciplinary engineering context and its underlying principles.

S1

The ability to make general evaluations of commercial risks through some understanding of the basis of such risks.

S2

Extensive knowledge and understanding of management and business practices, and their limitations, and how these may be applied appropriately to strategic and tactical issues.

E1

Ability to use fundamental knowledge to investigate new and emerging technologies.

E3

Ability to apply mathematical and computer based models for solving problems in engineering, and the ability to assess the limitations of particular cases.

P3

Understanding of contexts in which engineering knowledge can be applied (e.g. operations and management, technology, development, etc).

P8

Ability to apply engineering techniques taking account of a range of commercial and industrial constraints.

US1

A comprehensive understanding of the scientific principles of own specialisation and related disciplines.

US3

An understanding of concepts from a range of areas including some outside engineering, and the ability to apply them effectively in engineering projects.

 
Last modified: 18/06/2022 11:24

Engineering Tripos Part IIB, 4I1: Strategic Valuation, 2017-18

Module Leader

Dr H Jiang

Lecturer

Dr H Jiang

Lab Leader

Dr H Jiang

Timing and Structure

Christmas vacation - dates below; Assessment: Coursework 100% ind project combining spreadsheet modelling, written analysis and a management-style report - details TBA. You may conduct some Excel modelling with fellow students. Michaelmas/Lent Term break.

Prerequisites

All participants are expected to be familiar with probability and statistics at the level of a final year high school or introductory undergraduate course. See the prerequisites document on the course website for details. Participants are also expected to be familiar with basic Excel spreadsheet modelling (see e.g. http://best-excel-tutorial.com/54-basics for a tutorial). The basic Excel functions and tasks that you must know how to use competently are: MAX, AVERAGE, COUNT, IF, SUMPRODUCT; mathematical formulas based on relative and absolute references; creating simple tables; plotting pie, bar, column and line charts.

Aims

The aims of the course are to:

  • See below.

Objectives

As specific objectives, by the end of the course students should be able to:

  • See below.

Content

  • Module Time: 3 full days (9.00am – 5.00pm) on 4th, 6th, and 8th December 2017.
  • Reserve 4th – 11th December 2017 for TPE25 only.
  • Reserve 9th and 10th December 2017 for conducting part I of the course assessment.
  • Reserve a compulsory Q&A session for the course assessment at 9am-11am on 11th December 2017.
  • It is useful for you to have a Window-based laptop for Excel modelling. If you do not have a laptop, be prepared to stay in Cambridge for a few more days after 11th December 2017 so that you can conduct Excel modelling in the CJBS Computer Lab.
  • The level of mathematical theory may be below the expectation of some CUED students.
This module introduces students to two essential and complementary ways of dealing with future uncertainties. On one hand, we have diversification, the notion that you should "not put all your eggs in one basket", is both intuitive and ubiquitous in modern management. This exemplifies passive risk management. On the other, we have the real options paradigm. This emphasises that future value depends both on unfolding uncertainties, which you cannot control, and the flexibility of your future responses. By investing in research and development projects, for example, companies buy the option to launch a product, which they may or may not exercise, depending on the level of success of the R and D effort and on market conditions at the time of launch. However, flexibility also costs money: R and D expenditure, for example in the biotech industry, can be huge. So how much flexibility shall we build into the system? This is the realm of project design for active risk management. System designers and project managers need tools that help them decide if added flexibility is worth the money. This course provides the students with a mindset and a suite of tools to tackle such problems.
 
The emphasis is on management and design of technological projects. Examples and case studies will illustrate how theory can be adapted to actual conditions.
 
Please note that the number of places available to Part IIB Engineers is limited.  Students who have not taken 3E3 will be given priority.  A ballot will be held if the module looks likely to be oversubscribed.  The ballot will take place on the first day of lectures, after which the Teaching Office will be in touch with any unsuccessful applicants to ask them to select another module.

Day 1: Foundations

  • Course aims and objectives
  • Review of traditional project valuation
  • System value is a shape, not a number
  • Monte Carlo Simulation
  • (Valuing flexibility)

Preparatory reading:

  • Savage (2003), Ch. 2: ‘The building blocks of uncertainty: random variables’, Ch. 3: ‘The buildings of uncertainty: functions of random variables’.
  • If you have not seen Net Present Value (NPV) or Discounted Cash Flows before, read Brealey and Meyers, Ch. 2: ‘Present values’

 

Day 2: Portfolio Thinking

  • Diversification
  • Hedging
  • Trading off risk against return

Preparatory reading:

Day 3: Real Options Analysis

  • Flexibility: Intuition behind real options
  • Lattice valuations

Preparatory reading:

  • Brealey and Meyers, Ch. 10: ‘Project Analysis’, Ch. 20: ‘Understanding Options’ [For the 9th edition, use Ch. 11, Ch. 21]
  • de Neufville and Scholtes (2011), Ch. I: ‘High Level Overview’ (pp. 1-39)

Further notes

Required software

The basic modelling tool will be Microsoft Excel. Essential add-ins include Analysis ToolPak and Solver, both of which come with Excel but may require the Excel installation disks, and @Risk, which will be distributed to you.

Coursework

Coursework Format

Due date

& marks

100% individual project combining spreadsheet modelling, written analysis and a management-style report. The coursework consists of two parts: Task I (65%-70%) and Task II (30%-35%).

Task I contains a number of subtasks, in which students are asked to conduct intensive Excel modelling, to answer questions, to provide analysis, and to give intuitive business interpretations. 

Task II is a short presentation and is assessed by a set of criteria: intuition (business implication), prioritising information (structure), clarity and use of visual aids such as charts and graphs, and language.

Individually Assessed

Answer Sheet, Presentation Document and Excel Files

anonymously marked

The coursework will be carried out during Michaelmas/Lent term break and will be submitted right before the beginning of the Lent term in January 2018.

Marks will be available in three-four weeks after the submission date.

 

Booklists

Please see the Booklist for Group I Courses for references for this module.

Module Webpage

To be advised: https://www.vle.cam.ac.uk/course/view.php?id=83341

TPE6 Strategic Valuation

Reference Books

The following are available in multiple copies in the Judge Business School Information Centre:

 

de Neufville, R. and Scholtes, S. (2011)

Flexibility in Engineering Design. Cambridge, MA: MIT Press

E-book via Dawsonera (Click on ‘institutional login’)

 

Printed book at:

TA174.D46 2011

Brealey, R. A, Myers, S. C. and Allen, F. (2011)

 

or

Brealey, R. A, Myers, S. C. and Allen, F. (2008)

Principles of Corporate Finance. 10th ed. Boston, Mass.: Irwin McGraw Hill

 

 

 

9th ed.

 

 

N.B. For Brealey and Myers, any edition from 6th ed. onwards is fine.

 

Printed books at:

HG4026.B73 P7 2011

 

 

 

HG4026.B73 P7 2008

 

 

Savage, S. L. (2003)

Decision Making with Insight. Belmont, CA: Brooks/Cole

Printed book at:

HF5548.4.S38 2003

 

Luenberger, D. G. (1998)

Investment Science. Oxford: Oxford University Press

Printed book at:

HG4515.2.L83

 

Examination Guidelines

Please refer to Form & conduct of the examinations.

UK-SPEC

This syllabus contributes to the following areas of the UK-SPEC standard:

Toggle display of UK-SPEC areas.

GT1

Develop transferable skills that will be of value in a wide range of situations. These are exemplified by the Qualifications and Curriculum Authority Higher Level Key Skills and include problem solving, communication, and working with others, as well as the effective use of general IT facilities and information retrieval skills. They also include planning self-learning and improving performance, as the foundation for lifelong learning/CPD.

IA1

Apply appropriate quantitative science and engineering tools to the analysis of problems.

IA2

Demonstrate creative and innovative ability in the synthesis of solutions and in formulating designs.

KU1

Demonstrate knowledge and understanding of essential facts, concepts, theories and principles of their engineering discipline, and its underpinning science and mathematics.

KU2

Have an appreciation of the wider multidisciplinary engineering context and its underlying principles.

S1

The ability to make general evaluations of commercial risks through some understanding of the basis of such risks.

S2

Extensive knowledge and understanding of management and business practices, and their limitations, and how these may be applied appropriately to strategic and tactical issues.

E1

Ability to use fundamental knowledge to investigate new and emerging technologies.

E3

Ability to apply mathematical and computer based models for solving problems in engineering, and the ability to assess the limitations of particular cases.

P3

Understanding of contexts in which engineering knowledge can be applied (e.g. operations and management, technology, development, etc).

P8

Ability to apply engineering techniques taking account of a range of commercial and industrial constraints.

US1

A comprehensive understanding of the scientific principles of own specialisation and related disciplines.

US3

An understanding of concepts from a range of areas including some outside engineering, and the ability to apply them effectively in engineering projects.

 
Last modified: 12/09/2017 16:31

Engineering Tripos Part IIB, 4I1: Strategic Valuation, 2024-25

Module Leader

Prof. H Jiang

Lecturer

Prof. H Jiang

Lab Leader

Prof. H Jiang

Timing and Structure

Christmas vacation - dates below; Assessment: Coursework 100% in project combining spreadsheet modelling, written analysis and a management-style report - details TBA. You may conduct some Excel modelling with fellow students. Michaelmas/Lent Term break.

Prerequisites

All participants are expected to be familiar with probability and statistics at the level of a final year high school or introductory undergraduate course. See the prerequisites document on the course website for details. Participants are also expected to be familiar with basic Excel spreadsheet modelling (see e.g., http://best-excel-tutorial.com/54-basics for a tutorial). The basic Excel functions and tasks that you must know how to use competently are: MAX, AVERAGE, COUNT, IF, SUMPRODUCT; mathematical formulas based on relative and absolute references; creating simple tables; and plotting pie, bar, column and line charts.

Aims

The aims of the course are to:

  • See below.

Objectives

As specific objectives, by the end of the course students should be able to:

  • See below.

Content

There will be an introduction session of the course in October 2024.

  • Module Time: 3 full days (9.00am – 5.00pm) on 9th, 11th, and 13th December 2024.
  • Reserve 9th – 16th December 2024 for TPE25 ONLY.
  • Reserve 14th and 15th December 2024 to conduct part I of the course assessment.
  • Reserve a compulsory Q&A session for the course assessment on 16th December 2024.
  • It is necessary for you to have a Window-based or MacOS laptop for Excel modelling. There is a possibility that students use computers in the computer lab. If you do not have a laptop, be prepared to stay in Cambridge for a few more days after 16th December 2024 so that you can conduct Excel modelling in relation to your course assessment in the CJBS Computer Lab – subject to the availability of the lab.
  • The level of mathematical theory may be below the expectation of some CUED students.
This module introduces students to two essential and complementary ways of dealing with future uncertainties. On one hand, we have diversification, the notion that you should "not put all your eggs in one basket", is both intuitive and ubiquitous in modern management. This exemplifies passive risk management. On the other, we have the real options paradigm. This emphasises that future value depends both on unfolding uncertainties, which you cannot control, and the flexibility of your future responses. By investing in research and development projects, for example, companies buy the option to launch a product, which they may or may not exercise, depending on the level of success of the R and D effort and on market conditions at the time of launch. However, flexibility also costs money: R and D expenditure, for example in the biotech industry, can be huge. So how much flexibility shall we build into the system? This is the realm of project design for active risk management. System designers and project managers need tools that help them decide if added flexibility is worth the money. This course provides the students with a mindset and a suite of tools to tackle such problems.
 
The emphasis is on management and design of technological projects. Examples and case studies will illustrate how theory can be adapted to actual conditions.
 
Please note that the number of places available to Part IIB Engineers is limited.  A ballot will be held if the module looks likely to be oversubscribed.  The ballot will take place on the first day of lectures, after which the Teaching Office will be in touch with any unsuccessful applicants to ask them to select another module.

Day 1: Foundations

  • Course aims and objectives
  • Review of traditional project valuation
  • System value is a shape, not a number
  • Monte Carlo Simulation
  • (Valuing flexibility)

Preparatory reading:

  • de Neufville, R. and Scholtes, S. (2011), Ch 2: "Recognition of Uncertainty".
  • If you have not seen Net Present Value (NPV) or Discounted Cash Flows before, read Brealey and Meyers, Ch. 2: ‘Present values’.

 

Day 2: Portfolio Thinking

  • Diversification
  • Hedging
  • Trading off risk against return

Preparatory reading:

Day 3: Real Options Analysis

  • Flexibility: Intuition behind real options
  • Lattice valuations

Preparatory reading:

  • Brealey and Meyers, Ch. 10: ‘Project Analysis’, Ch. 20: ‘Understanding Options’ [For the 9th edition, use Ch. 11, Ch. 21]
  • de Neufville and Scholtes (2011), Ch. I: ‘High Level Overview’ (pp. 1-39)

Further notes

Required software

The basic modelling tool will be Microsoft Excel. Essential add-ins include Analysis ToolPak and Solver, both of which come with Excel but may require the Excel installation disks, and @Risk, which will be distributed to you.

Coursework

Coursework Format

Due date

& marks

100% individual project combining spreadsheet modelling, written analysis and a management-style report. The coursework consists of two parts: Task I (65%-70%) and Task II (30%-35%).

Task I contains a number of subtasks, in which students are asked to conduct intensive Excel modelling, to answer questions, to provide analysis, and to give intuitive business interpretations. 

Task II is a short presentation and is assessed by a set of criteria: intuition (business implication), prioritising information (structure), clarity and use of visual aids such as charts and graphs, and language.

Individually Assessed

Answer Sheet, Presentation Document and Excel Files

Anonymously marked

The coursework will be carried out during Michaelmas/Lent term break and will be submitted right before the beginning of the Lent term in January 2025.

Marks will be available in three-four weeks after the submission date.

 

Booklists

Please refer to the Booklist for Part IIB Courses for references to this module, this can be found on the associated Moodle course.

Module Webpage

To be advised: https://www.vle.cam.ac.uk

TPE25 Strategic Valuation

Reference Books

The following are available in multiple copies in the Judge Business School Information Centre:

 

de Neufville, R. and Scholtes, S. (2011)

Flexibility in Engineering Design. Cambridge, MA: MIT Press

E-book: https://ebookcentral.proquest.com/lib/CAM/detail.action?pq-origsite=prim... 

 

Printed book at:

TA174.D46 2011

Brealey, R. A, Myers, S. C. and Allen, F. (2019)

 

or

Brealey, R. A, Myers, S. C. and Allen, F. (2008)

Principles of Corporate Finance. 13th ed. Boston, Mass.: Irwin McGraw Hill

 

 

 

9th ed.

 

 

N.B. For Brealey and Myers, any edition from 6th ed. onwards is fine.

 

Printed books at:

HG4026.B73 P7 2011

E-book: https://www.vlebooks.com/Vleweb/Product/Index/1993343?page=0 

 

 

 

HG4026.B73 P7 2008

 

 

Savage, S. L. (2003)

Decision Making with Insight. Belmont, CA: Brooks/Cole

Printed book at:

HF5548.4.S38 2003

 

Luenberger, D. G. (1998)

Investment Science. Oxford: Oxford University Press

Printed book at:

HG4515.2.L83

 

Examination Guidelines

Please refer to Form & conduct of the examinations.

UK-SPEC

This syllabus contributes to the following areas of the UK-SPEC standard:

Toggle display of UK-SPEC areas.

GT1

Develop transferable skills that will be of value in a wide range of situations. These are exemplified by the Qualifications and Curriculum Authority Higher Level Key Skills and include problem solving, communication, and working with others, as well as the effective use of general IT facilities and information retrieval skills. They also include planning self-learning and improving performance, as the foundation for lifelong learning/CPD.

IA1

Apply appropriate quantitative science and engineering tools to the analysis of problems.

IA2

Demonstrate creative and innovative ability in the synthesis of solutions and in formulating designs.

KU1

Demonstrate knowledge and understanding of essential facts, concepts, theories and principles of their engineering discipline, and its underpinning science and mathematics.

KU2

Have an appreciation of the wider multidisciplinary engineering context and its underlying principles.

S1

The ability to make general evaluations of commercial risks through some understanding of the basis of such risks.

S2

Extensive knowledge and understanding of management and business practices, and their limitations, and how these may be applied appropriately to strategic and tactical issues.

E1

Ability to use fundamental knowledge to investigate new and emerging technologies.

E3

Ability to apply mathematical and computer based models for solving problems in engineering, and the ability to assess the limitations of particular cases.

P3

Understanding of contexts in which engineering knowledge can be applied (e.g. operations and management, technology, development, etc).

P8

Ability to apply engineering techniques taking account of a range of commercial and industrial constraints.

US1

A comprehensive understanding of the scientific principles of own specialisation and related disciplines.

US3

An understanding of concepts from a range of areas including some outside engineering, and the ability to apply them effectively in engineering projects.

 
Last modified: 26/09/2024 18:28

Engineering Tripos Part IIB, 4I1: Strategic Valuation, 2025-26

Module Leader

Prof. H Jiang

Lecturer

Prof. H Jiang

Lab Leader

Prof. H Jiang

Timing and Structure

Christmas vacation - dates below; Assessment: Coursework 100% in project combining spreadsheet modelling, written analysis and a management-style report - details TBA. You may conduct some Excel modelling with fellow students. Michaelmas/Lent Term break.

Prerequisites

All participants are expected to be familiar with probability and statistics at the level of a final year high school or introductory undergraduate course. See the prerequisites document on the course website for details. Participants are also expected to be familiar with basic Excel spreadsheet modelling (see e.g., http://best-excel-tutorial.com/54-basics for a tutorial). The basic Excel functions and tasks that you must know how to use competently are: MAX, AVERAGE, COUNT, IF, SUMPRODUCT; mathematical formulas based on relative and absolute references; creating simple tables; and plotting pie, bar, column and line charts.

Aims

The aims of the course are to:

  • See below.

Objectives

As specific objectives, by the end of the course students should be able to:

  • See below.

Content

There will be an introduction session for the course in October 2025. If you have any question, please contact techpol-enquiries@jbs.cam.ac.uk.

  • Module Time: 3 full days (9.00am – 5.30pm) on 8th, 10th, and 12th December 2025.
  • Reserve 8th – 15th December 2025 for TPE25 ONLY.
  • Reserve 13th and 14th December 2025 to conduct part I of the course assessment.
  • Reserve a compulsory Q&A session for the course assessment on 15th December 2025.
  • It is necessary for you to have a Window-based or MacOS laptop for Excel modelling. There is a possibility that students use computers in the computer lab. If you do not have a laptop, be prepared to stay in Cambridge for a few more days after 15th December 2025, so that you can conduct Excel modelling in relation to your course assessment in the CJBS Computer Lab – subject to the availability of the lab.
  • The level of mathematical theory may be below the expectations of some CUED students.
This module introduces students to two essential and complementary ways of dealing with future uncertainties. On one hand, we have diversification, the notion that you should "not put all your eggs in one basket", is both intuitive and ubiquitous in modern management. This exemplifies passive risk management. On the other, we have the real options paradigm. This emphasises that future value depends both on unfolding uncertainties, which you cannot control, and the flexibility of your future responses. By investing in research and development projects, for example, companies buy the option to launch a product, which they may or may not exercise, depending on the level of success of the R and D effort and on market conditions at the time of launch. However, flexibility also costs money: R and D expenditure, for example in the biotech industry, can be huge. So how much flexibility shall we build into the system? This is the realm of project design for active risk management. System designers and project managers need tools that help them decide if added flexibility is worth the money. This course provides the students with a mindset and a suite of tools to tackle such problems.
 
The emphasis is on management and design of technological projects. Examples and case studies will illustrate how theory can be adapted to actual conditions.
 
Please note that the number of places available to Part IIB Engineers is limited.  A ballot will be held if the module looks likely to be oversubscribed.  The ballot will take place on the first day of lectures, after which the Teaching Office will be in touch with any unsuccessful applicants to ask them to select another module.

Day 1: Foundations

  • Course aims and objectives
  • Review of traditional project valuation
  • System value is a shape, not a number
  • Monte Carlo Simulation
  • (Valuing flexibility)

Preparatory reading:

  • de Neufville, R. and Scholtes, S. (2011), Ch 2: "Recognition of Uncertainty".
  • If you have not seen Net Present Value (NPV) or Discounted Cash Flows before, read Brealey and Meyers, Ch. 2: ‘Present values’.

 

Day 2: Portfolio Thinking

  • Diversification
  • Hedging
  • Trading off risk against return

Preparatory reading:

Day 3: Real Options Analysis

  • Flexibility: Intuition behind real options
  • Lattice valuations

Preparatory reading:

  • Brealey and Meyers, Ch. 10: ‘Project Analysis’, Ch. 20: ‘Understanding Options’ [For the 9th edition, use Ch. 11, Ch. 21]
  • de Neufville and Scholtes (2011), Ch. I: ‘High Level Overview’ (pp. 1-39)

Further notes

Required software

The basic modelling tool will be Microsoft Excel. Essential add-ins include Analysis ToolPak and Solver, both of which come with Excel but may require the Excel installation disks, and @Risk, which will be distributed to you.

Coursework

Coursework Format

Due date

& marks

100% individual project combining spreadsheet modelling, written analysis and a management-style report. The coursework consists of two parts: Task I (65%-70%) and Task II (30%-35%).

Task I contains a number of subtasks, in which students are asked to conduct intensive Excel modelling, to answer questions, to provide analysis, and to give intuitive business interpretations. 

Task II is a short presentation and is assessed by a set of criteria: intuition (business implication), prioritising information (structure), clarity and use of visual aids such as charts and graphs, and language.

Individually Assessed

Answer Sheet, Presentation Document and Excel Files

Anonymously marked

The coursework will be carried out during Michaelmas/Lent term break and will be submitted right before the beginning of the Lent term in January 2026.

Marks will be available in three-four weeks after the submission date.

 

Booklists

Please refer to the Booklist for Part IIB Courses for references to this module, this can be found on the associated Moodle course.

Module Webpage

To be advised: https://www.vle.cam.ac.uk

TPE25 Strategic Valuation

Reference Books

The following are available in multiple copies in the Judge Business School Information Centre:

 

de Neufville, R. and Scholtes, S. (2011)

Flexibility in Engineering Design. Cambridge, MA: MIT Press

E-book: https://ebookcentral.proquest.com/lib/CAM/detail.action?pq-origsite=prim... 

 

Printed book at:

TA174.D46 2011

Brealey, R. A, Myers, S. C. and Allen, F. (2019)

 

or

Brealey, R. A, Myers, S. C. and Allen, F. (2008)

Principles of Corporate Finance. 13th ed. Boston, Mass.: Irwin McGraw Hill

 

 

 

9th ed.

 

 

N.B. For Brealey and Myers, any edition from 6th ed. onwards is fine.

 

Printed books at:

HG4026.B73 P7 2011

E-book: https://www.vlebooks.com/Vleweb/Product/Index/1993343?page=0 

 

 

 

HG4026.B73 P7 2008

 

 

Savage, S. L. (2003)

Decision Making with Insight. Belmont, CA: Brooks/Cole

Printed book at:

HF5548.4.S38 2003

 

Luenberger, D. G. (1998)

Investment Science. Oxford: Oxford University Press

Printed book at:

HG4515.2.L83

 

Examination Guidelines

Please refer to Form & conduct of the examinations.

UK-SPEC

This syllabus contributes to the following areas of the UK-SPEC standard:

Toggle display of UK-SPEC areas.

GT1

Develop transferable skills that will be of value in a wide range of situations. These are exemplified by the Qualifications and Curriculum Authority Higher Level Key Skills and include problem solving, communication, and working with others, as well as the effective use of general IT facilities and information retrieval skills. They also include planning self-learning and improving performance, as the foundation for lifelong learning/CPD.

IA1

Apply appropriate quantitative science and engineering tools to the analysis of problems.

IA2

Demonstrate creative and innovative ability in the synthesis of solutions and in formulating designs.

KU1

Demonstrate knowledge and understanding of essential facts, concepts, theories and principles of their engineering discipline, and its underpinning science and mathematics.

KU2

Have an appreciation of the wider multidisciplinary engineering context and its underlying principles.

S1

The ability to make general evaluations of commercial risks through some understanding of the basis of such risks.

S2

Extensive knowledge and understanding of management and business practices, and their limitations, and how these may be applied appropriately to strategic and tactical issues.

E1

Ability to use fundamental knowledge to investigate new and emerging technologies.

E3

Ability to apply mathematical and computer based models for solving problems in engineering, and the ability to assess the limitations of particular cases.

P3

Understanding of contexts in which engineering knowledge can be applied (e.g. operations and management, technology, development, etc).

P8

Ability to apply engineering techniques taking account of a range of commercial and industrial constraints.

US1

A comprehensive understanding of the scientific principles of own specialisation and related disciplines.

US3

An understanding of concepts from a range of areas including some outside engineering, and the ability to apply them effectively in engineering projects.

 
Last modified: 19/06/2025 21:32

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