Application of the Hidden Markov Model for innovative projects “viability” analysis

This article deals with determining of innovative projects “viability”. “Viability” is the probability of innovative project being implemented. Hidden Markov Models are used for evaluation of this factor. The problem of determining parameters of model, which produce given data sequence with the highest probability, are solving in this research. The Baum-Welch algorithm which is one implementation of Expectation-Maximization algorithm is used at this research for calculating model parameters. At the end part of the article mathematical basics for practical implementation are given (in particular mathematical description of the algorithm and implementation methods for Markov models).