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Pilot Early, Commit Late: A Real-Options Model of Enterprise AI Adoption under Rapid Technological Progress
Artificial intelligence presents firms with an unusual timing problem. The technology frontier is improving rapidly, implementation is partly irreversible, and organization-specific capabilities are accumulated through action. This paper develops a two-period decision model of AI deployment under uncertainty in which a firm chooses among immediate deployment, a limited pilot, and waiting. Deployment earns current operating value but exposes the firm to architectural obsolescence; waiting preserves the option to adopt after the frontier is observed; a pilot sacrifices current operating value to
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Evidence & attribution
- arXiv · AI, language, vision and robotics · 2026-09-14T17:30:37.000Z
First collected: 2026-09-20T09:41:04.278Z. This is not the publication date.