Mitigating foreign exchange risk exposure with supply chain flexibility: A real option analysis

Uncertainty and risk abound in supply chains. One such form of existing global chains comes from volatility associated with currency fluctuations—Foreign Exchange (FX) risk. Although the study practice using financial hedging instruments are well documented, there also emerging chain strategies firms may adopt for mitigating FX The purpose this multi-method is to investigate how professionals perceive mitigate risk, as measure investing flexibility affect firm performance. Using a mixed-method approach based on qualitative case studies simulation experiments lens Real Option Theory, we able show investments can terms cash flows profits. Theoretical, methodological, managerial implications provided better understanding finance discipline.