Juho-Kusti Kajander

Service‐dominant innovation in the built environment

Purpose – The main aim of this paper is to examine how commercial sustainability innovation projects in real estate and construction industries utilise the contemporary market‐oriented innovation models based on the service‐dominant logic.Design/methodology/approach – A survey of a large set of sustainability innovation projects was conducted and analysed.Findings – The results show that over a third of the examined projects lack all the necessary innovation components recognised in the literature. Furthermore, very few projects utilised concurrent market feedback in the development phase. The study suggests that sustainability innovations fail commercially in built environment, because they lack active customer participation and value network involvement, and they aim for incremental instead of radical improvements.Research limitations/implications – Future research should address available ways for companies in the real estate and construction industries to take advantage of their unused potential in cl...

Valuing flexibility in a retrofit investment

Purpose – The need for flexibility between organisational units is well established in corporate real estate. While the cost of flexibility is rather straightforward to approximate, measuring economical value of the flexibility is not straightforward. The purpose of this paper is to explore how real options analysis can be used for valuing flexibility in a real retrofit investment case, present a research process for valuing the flexibility in the retrofit investment case, and evaluate the empirical usability of real options valuation results compared with traditional discounted cash flow valuation results. Design/methodology/approach – The research is conducted as a case study. A newly introduced real options valuation method, the fuzzy pay-off method is used for analysing data from a Finnish office building retrofit investment case. The major difference in the selected method is that it uses fuzzy set theory instead of probabilistic theory, and the main advantage is the practical applicability, i.e. onl...