Price Taker

Operating under competitive markets, classical theory suggests that each firm has limited influence on prices, given that their volumes are too small to move markets. In this context, each firm’s investments are similarly price-neutral. For this reason, managers rely on quantitative analytics espoused by capital budgeting to inform their choices. However, instead of sailing through with ease, the decision process is nuanced, if not contorted. An alternative approach is to employ the BOUnCE framework, which serves as a way to integrate human biases and preferences into managerial decision-making. It validates and continually reframes investment approaches by simulating feasible futures. In understanding why and how energy markets transition, actions are adapted to respond to shifting strategic intents, potentially altering the firm’s financial prospects.