Thesis (MBA)--Stellenbosch University, 2004. / ENGLISH ABSTRACT: Everyone, generally. would like to make good decisions, or receive the greatest benefit from a decision made. Companies are no different in this respect and the process of selecting an investment project portfolio has become an important activity. This is, further, complicated by the fact that companies have multiple, and often, conflicting objectives in a situation of capital rationing. This study project proposes a conceptual framework for project portfolio establishment, for application in an industrial manufacturing type environment, by integrating project evaluation and selection, a multi-criteria decision analysis technique and group decision-making. The project issues, the selection of a multi-criteria decision analysis technique and group decisionmaking are dealt with sequentially and then integrated to develop this conceptual framework. The explorative part of this study project deals with project evaluation and selection issues, and the concept of the triple bottom line is proposed to capture the multiple objectives of the company's decision context. Further, decision analysis concepts are reviewed and three categories of multi-criteria decision analysis methods identified. Selected methods in these categories are described, examined and the advantages and drawbacks of the different categories highlighted. The Analytic Hierarchy Process is proposed as the underlying multi-criteria decision analysis technique to support this conceptual framework. Group decision-making is investigated, and aggregation procedures and a method of consistency checking suggested. Finally, the framework is applied to a hypothetical case and the results presented. / AFRIKAANSE OPSOMMING: Oor die algemeen wil almal goeie besluite neem, of maksimum voordeel uit die besluite trek. Maatskappye het dieselfde motivering en die aktiwiteit om 'n kapitaalinvesteringsportfolio saam te stel word as van groot belang beskou. Hierdie aktiwiteit is ook deur die werklikheid van vele, dikwels teenstrydige doelwitte sowel as beperkte fondse bemoeilik. In hierdie werkstuk word 'n begripsraamwerk vir die daarstelling van 'n investeringsportfolio vir kapitaalprojekte in 'n nywerheidsomgewing, wat projekevaluering en - keuring, veelvoudige kriterium besluitnemingstegnieke en groepsbesluitneming insluit, voorgestel. Projekverwante faktore, die keuse van 'n veelvoudige kriterium besluitnemingstegniek en derdens groepsbesluitneming word apart bespreek en daarna in die bogenoemde raamwerk geintegreer. Die navorsingsgedeelte van hierdie werkstuk verwys na die evaluering en keuse van projekte. Die begrip van 'n drievoudige maatstaf ('triple bottom line') om die kompleksiteit van 'n maatskappy se besluitnemingsdoelwitte te illustreer, word ondersteun. Daarna word besluitnemingsbegrippe bespreek en drie kategoriee van tegnieke vir veelvoudige kriterium besluitnemings uitgelig. Onder hierdie kategoriee is verkose metodes beskryf en ondersoek, en voor- en nadele van die kategoriee uitgewys. Die Analitiese Hierargie proses word voorgestel as basis van die begripsraamwerk. Groepsbesluitneming word ondersoek en versamelingsmetodes met kontrole vir konsekwentheid word voorgestel. Laastens word die besluitnemingsraamwerk op 'n denkbeeldige geval toegepas en word die resultate bespreek.

Volvo’s plant in Umeå has a constant need for development, where to start new activities like projects and investments are important tools, where the competition on the market is increasing. The need for investments are major compared to the resources available, both in terms of human resources and economic resources. The plant needs to prioritize trying to choose what kind of investments are the best for the plant’s future. The problem is that there is a lack of reliable priority model for investments that consider several different parameters. To solve this issue the goal is to create a useful model that can work as a tool to prioritize projects and investments in an appropriate and reliable way. The study began with a literature review to make the researcher approach the subject and gather the knowledge needed for this study. After this, qualitative semi-structured interviews were made with different managers at the plant, to acquire their expertise and knowledge regarding the selection of criteria and their preferences of how the model should work. The next step was to analyze the old model used at the plant, its strengths, and weaknesses. At the same time, constant discussions were held with the supervisor and his manager but as well with the university, mainly through seminars. When the researcher felt he was ready he started to create the new model. There were 30 criteria included in the model, mainly collected through interviews. The large number of criteria collected were sorted into Volvo’s catchwords SQDCEP (Safety, Quality, Delivery, Cost, Environmental, People). These were decided to function as the main criteria in the model, and all the 30 criteria were called sub-criteria. The model itself originates from a process called the Analytical Hierarchy Process (AHP). It is an established and wellknown methodology to make prioritizations. Its main idea is to compare every single project against each other which makes the method very thoughtful, solid and probably better than other ones. The conclusion is that the model is complete and should work perfectly to be used for Volvo and other companies in the complex manufacturing industry. Furthermore, the criteria chosen for the model should also be applicable for other similar companies to Volvo, as the criteria are not unique.

Esta pesquisa investigou quatro empresas multinacionais brasileiras em busca de suas práticas na gestão do portfólio de projetos de novos produtos. Por meio de um estudo multicaso, a pesquisa abrangeu diversos aspectos dessa gestão, tais como estratégia para novos produtos e tecnologias; mecanismos de identificação de oportunidades e fontes de idéias para novos produtos; estrutura e recursos de engenharia e P&D; técnicas preferidas para análise, seleção e priorização de projetos; mecanismos de acompanhamento no desenvolvimento dos novos produtos e revisão do portfólio. Um conjunto de práticas de gestão foi identificado e comparado a quatro modelos teóricos, o que levou à conclusão que as empresas gerenciam seu portfólio de forma heterogênea. Mesmo assim, tais práticas produzem como resultado final uma importante vantagem competitiva e podem auxiliar outras empresas na busca pela excelência na gestão da inovação por meio da gestão do seu portfólio de projetos de novos produtos. Ainda que não seja possível generalizar as conclusões acerca dos casos, os resultados apontam diversas intersecções entre as práticas encontradas nas empresas e os modelos teóricos, convergindo para um conjunto comum de práticas gerenciais que podem favorecer o desempenho de outras organizações, além de contribuir com subsídios para futuras pesquisas. / This research has investigated four Brazilian multinational companies looking for their most used practices in managing their portfolio of new product projects. To accomplish this goal, a multi-case study was undertaken. Several aspects of the new products portfolio management were explored, such as product innovation strategy; R&D structure and resources; opportunities seizing mechanisms and sources for new product ideas; preferred project evaluation and selection techniques; decision makers\' preferences and profiles; new product development measures and portfolio periodic revision. Based on this investigation, a set of practices was identified and compared to four theoretical models. It was found that the companies manage their portfolio in heterogeneous ways. However, such practices contribute to the overall innovation in the companies and produce a substantial competitive advantage. Indeed, such practices can also help other companies in achieving new products portfolio management excellence. Although the conclusions that followed through can not be generalized to a management model, the results can substantially aid other companies in leveraging their portfolio management performance and also be a relevant contribution for future research.

A composição de um portfolio de projetos é realizada de acordo com um conjunto de critérios de seleção e avaliação de projetos, que permite identificar quais projetos trazem maior valor, benefícios e alinhamento com as estratégias definidas pela organização, para um determinado horizonte de tempo. O grau de exposição a riscos do portfolio de projetos é um dos critérios mais importantes a ser considerado na composição e no balanceamento do portfolio, uma vez que indica a magnitude dos desvios a que o portfolio está sujeito em relação ao atendimento de seus objetivos. Este trabalho apresenta um procedimento para a avaliação do grau de exposição a riscos do portfolio de projetos, que parte dos riscos de cada projeto, e considera seus inter-relacionamentos, bem como outros riscos inerentes ao portfolio como um todo. O procedimento abrange a identificação, análise e tratamento dos riscos do portfolio e a determinação do grau de exposição a riscos no atendimento de cada objetivo e do portfolio com um todo. Através de um estudo de caso, realizado numa empresa multinacional do setor de máquinas e equipamentos, o procedimento foi testado num portfolio composto por nove dos maiores projetos de sua maior unidade de negócio. Foi possível determinar o grau de exposição a riscos do portfolio de projetos frente aos objetivos estratégicos a que se propunha atender valores determinados de margem bruta média e faturamento para o ano fiscal corrente. O estudo de caso permitiu validar a aplicabilidade do procedimento. A identificação dos riscos em comum, das interdependências e de outros riscos abrangentes permitiu identificar causas comuns e proliferações entre os riscos dos projetos e, principalmente, racionalizar recursos no tratamento dos riscos. / When building a project portfolio, evaluation and selection criteria are used to recognize which projects bring greater value, benefits and alignment with the organization strategies defined for a given period of time. One of the most relevant criteria in project portfolio composition and balancing is the risk exposure, as it indicates the magnitude of slippages to which the organization objectives are susceptible. This work presents a procedure for the evaluation of the overall project portfolio risk exposure, considering the risks of each project, the inter-relationships among them, and also other risks inherent to the portfolio as a whole. The procedure encloses portfolio risks identification, analysis and treatment and the assessment of the risk exposure in the attendance of each objective as well as for the complete portfolio. Through a case study, carried through in a world class multinational company of the capital goods sector, the risk analysis procedure has been tested in a portfolio encompassing nine major projects from its main business unit. It has been possible to define the risk exposure related to the strategic objectives this portfolio should fulfill average gross margin and revenues for the current fiscal year. The case study has allowed validating the applicability of the proposed procedure. The identification of common risks, interdependences and other overall portfolio risks has also allowed to recognize common causes, proliferation among projects and, mainly, to rationalize resources in treating these risks.

<p>Despite the many researches made on emergent strategies and project portfolio management, one can hardly find studies on the link between them. It can easily be assumed that emergent strategies and market dynamics have considerable effect on the portfolio of projects in organizations and, supposedly, give rise to emergent projects. We defined emergent projects to be untypical or irregular projects for the organization which are at the borderline or even outside the mainstream of the current portfolio of projects. These types of projects impact the company’s strategy with the aim to increase the organizations competitiveness. This study will try to find out the possible distinct characteristics and strategic impact of emergent projects on large organizations so that these kinds of projects can be properly recognized for what they really are and managed effectively.</p><p> </p><p>We used a semi-structured interview method to collect data from six international companies in four countries. The countries are Germany, Switzerland, Sweden, and Taiwan. Using template analysis method, we analyzed the collected data. The analysis confirmed our assumption that there is a correlation between emergent strategies and project portfolio management. Moreover, we found out some of the characteristics and strategic impacts of emergent projects. The results of the study, therefore, shows that emergent projects are kinds of strategic projects which have bigger significance and bring a higher sense of urgency to organizations than the normal projects in their portfolio. Furthermore, the study indicated that emergent projects do not need any different project management methodology than typical projects do. Nonetheless, emergent projects are characterized by rarity, disrupting routine operations, enhancing company-customer relationship, causing resource reallocation, bringing profit, demanding higher budget, opening both internal and external new opportunities, posing risk due to shorter planning phase and limited implementation time, and capturing higher attention from top management. The major result we have found out in the research about the strategic impact of emergent projects is that they have a higher potential to bring profit and new business opportunities which in total make organizations more competitive in their respective markets.</p><p>The theoretical and managerial implications of our research have a common idea that emergent projects should be recognized and categorized as strategic projects of organizations. Further studies should be carried out on how the dynamic situations of business environments and emergent strategies affect the project portfolio of organizations. Moreover, it is worth researching on how the idea of emergent projects are dealt in the studies of strategic project management and project categorization both in the academic and practitioners world. Overall, the study has brought the linkage between emergent strategies and project portfolio management into light through the discussion on emergent projects.</p>

Bakgrund: Det finns en rad olika faktorer som påverkar produktutvecklingsprocessen vid ett företag. Isaberg Rapid AB utvecklar, tillverkar och marknadsför en rad produkter inom tre olika produktområden; kontor, verktyg och OEM. Denna studie fokuserar på produktutvecklingsprocesserna inom divisionen för kontorsprodukterna vilken kanske är den mest konkurrentutsatta på företaget. Produkterna som tillhandahålls av divisionen är under hårt tryck från konkurrenter på en global basis och snabba och effektiva produktsläpp är av yttersta vikt för att hävda sig på marknaden. De olika aktiviteterna omkring produktutveckling i kombination med de snabba förändringarna av företagets marknadssituation med nya kundgrupper och ökande konkurrens, har lett fram till vissa specifika ofrånkomliga faktorer som har en stor inverkan på produktutvecklingens effektivitet. Detta resonemang leder sedermera fram till uppsatsens syfte. Syfte: Syftet med uppsatsen är primärt att identifiera, och påvisa samband mellan, faktorer som påverkar utvecklingen av nya produkter vid Isaberg Rapid AB och sekundärt att påvisa brister i hanteringen av dessa. Metod: Syftet har uppfyllts genom att använda en kvalitativ ansats där olika befattningshavare rörande produktutvecklingen på Isaberg Rapid AB har intervjuats. Även observationer har gjorts med avsikten att erhålla en djupare insyn i företagets arbetssätt och ingående funktioner. Referensramens teori och modeller användas för att belysa iakttagelserna i analysen på ett systematiskt sätt och för att förstå syftet. Intervjuerna har utförts enligt en semikonstruerad metod. Utfallet från intervjuerna har sedan analyserats, där fokus i första hand är övergripande, följt av de mer ämnesspecifika frågorna. Slutsatser: Vår studie har visat att genom att förbättra sammansättningen mellan långa och korta projekt med hög resp. låg risk kan projektportföljens strategiska och värdemässiga aspekter förbättras. Produktutvecklingen bör fokuseras på att utnyttja projektportföljen som ett kraftfullt instrument, för att utvecklingen inte ska tendera att styras över till orätta projekt på bekostnad av andra mera rätta projekt. Isaberg Rapid måsta således vara ledande inom produktutveckling, och överglänsa konkurrenterna genom att satsa på ny teknologi och våga ta risker, detta uppenbaras av framgångarna med Duax. Effektivare utveckling uppnås endast genom korrekta resursallokeringar och en snabb utvecklingstid, vilket dock fordrar en väl fungerande produktutvecklingsprocess. Då kan syftet infrias och målet uppnås. / Background: There are a number of different factors, affecting the product development process at a company. Isaberg Rapid AB develops, manufacture and sell products within three different business areas; office, tools and OEM. This essay focuses on the product development process at the office division of the company; perhaps the most competitively pressured division of the company. The products handled by the division are under hard pressure from competitors on a global basis and fast and effective product launches are highly important to maintain the position on the market. The activities associated with product development combined with a changing market situation have led to certain inevitable factors that deeply affect the efficiency of the product development process. These arguments eventually lead up to the purpose of this thesis. Purpose: The purpose of the thesis is primarily to identify, and point out connections between, factors affecting the development of new products at Isaberg Rapid AB, and secondary to point out failures in the handling of those. Method: using a qualitative method where different employees concerned with product development activities at the company have been interviewed has fulfilled the purpose. Observations to obtain a deeper company insight have also been performed. Theories and models from the frame of reference have been used to analyze the empirical findings systematically in order to understand the purpose. The interviews have been held in a semi constructed way. The results form the interviews have been analyzed with both a general focus and later on specified to the identified subjects. Conclusions: Our study has shown that the balance of the project portfolio in terms of long and short projects with high and low risk could be improved in terms of value and strategic aspects. Product development should be focused on utilizing the project portfolio as a powerful instrument, in order to avoid that the development tendons to choose a wrong project on behalf of others more right ones. Isaberg Rapid must in this manner leading the product development, and be ahead of its competitors by investing in new technology and be willing of taking risks, that the success with Duax has proven right. Effective product development is achieved by allocating the recourses right and provide for a fast time to market cycle, which however insist on a well-functioned product development. Then can the purpose be fulfilled and the objectives achieved totally.

Managing projects in an organization, especially a project-oriented organization, is a challenging task. Project data has a large volume and is complex to manage. It is different from managing a single project, because one needs to integrate and synthesize information from multiple projects and multiple perspectives for high-level strategic business decisions, such as aligning projects with business objectives, balancing investment and expected return, and allocating resources. Current methods and tools either do not well integrate multiple aspects or are not intuitive and easy to use for managers and executives. In this dissertation project, a multidimensional and visual exploration approach was designed and evaluated to provide a unique and intuitive option to support decision making in project portfolio management. The research followed a general design science research methodology involving phases of awareness of problem, suggestion, development, evaluation and conclusion. The approach was implemented into a software system using a prototyping method and was evaluated through user interviews. The evaluation result demonstrates the utility and ease-of-use of the approach, and confirms design objectives. The research brings a new perspective and provides a new decision support tool for project portfolio management. It also contributes to the design knowledge of visual exploration systems for business portfolio management by theorizing the system.

Despite the many researches made on emergent strategies and project portfolio management, one can hardly find studies on the link between them. It can easily be assumed that emergent strategies and market dynamics have considerable effect on the portfolio of projects in organizations and, supposedly, give rise to emergent projects. We defined emergent projects to be untypical or irregular projects for the organization which are at the borderline or even outside the mainstream of the current portfolio of projects. These types of projects impact the company’s strategy with the aim to increase the organizations competitiveness. This study will try to find out the possible distinct characteristics and strategic impact of emergent projects on large organizations so that these kinds of projects can be properly recognized for what they really are and managed effectively.   We used a semi-structured interview method to collect data from six international companies in four countries. The countries are Germany, Switzerland, Sweden, and Taiwan. Using template analysis method, we analyzed the collected data. The analysis confirmed our assumption that there is a correlation between emergent strategies and project portfolio management. Moreover, we found out some of the characteristics and strategic impacts of emergent projects. The results of the study, therefore, shows that emergent projects are kinds of strategic projects which have bigger significance and bring a higher sense of urgency to organizations than the normal projects in their portfolio. Furthermore, the study indicated that emergent projects do not need any different project management methodology than typical projects do. Nonetheless, emergent projects are characterized by rarity, disrupting routine operations, enhancing company-customer relationship, causing resource reallocation, bringing profit, demanding higher budget, opening both internal and external new opportunities, posing risk due to shorter planning phase and limited implementation time, and capturing higher attention from top management. The major result we have found out in the research about the strategic impact of emergent projects is that they have a higher potential to bring profit and new business opportunities which in total make organizations more competitive in their respective markets. The theoretical and managerial implications of our research have a common idea that emergent projects should be recognized and categorized as strategic projects of organizations. Further studies should be carried out on how the dynamic situations of business environments and emergent strategies affect the project portfolio of organizations. Moreover, it is worth researching on how the idea of emergent projects are dealt in the studies of strategic project management and project categorization both in the academic and practitioners world. Overall, the study has brought the linkage between emergent strategies and project portfolio management into light through the discussion on emergent projects.

We consider two classes of stochastic programming models which are motivated by two applications related to the field of aviation. The first problem we consider is the network capacity planning problem, which arises in capacity planning of systems with network structures, such as transportation terminals, roadways and telecommunication networks. We study this problem in the context of airport terminal capacity planning. In this problem, the objective is to determine the optimal design and expansion capacities for different areas of the terminal in the presence of uncertainty in future demand levels and expansion costs, such that overall passenger delay is minimized. We model this problem as a nonlinear multistage stochastic integer program with a multicommodity network flow structure. The formulation requires the use of time functions for maximum delays in passageways and processing stations, for which we derive approximations that account for the transient behavior of flow. The deterministic equivalent of the developed model is solved via a branch and bound procedure, in which a bounding heuristic is used at the nodes of the branch and bound tree to obtain integer solutions. In the second study, we consider the project portfolio optimization problem. This problem falls in the class of stochastic programs in which times of uncertainty realizations are dependent on the decisions made. The project portfolio optimization problem deals with the selection of research and development (R&D) projects and determination of optimal resource allocations for the current planning period such that the expected total discounted return or a function of this expectation for all projects over an infinite time horizon is maximized, given the uncertainties and resource limitations over a planning horizon. Accounting for endogeneity in some parameters, we propose efficient modeling and solution approaches for the resulting multistage stochastic integer programming model. We first develop a formulation that is amenable to scenario decomposition, and is applicable to the general class of stochastic problems with endogenous uncertainty. We then demonstrate the use of the sample average approximation method in solving large scale problems of this class, where the sample problems are solved through Lagrangian relaxation and lower bounding heuristics.

<p>Bakgrund: Det finns en rad olika faktorer som påverkar produktutvecklingsprocessen vid ett företag. Isaberg Rapid AB utvecklar, tillverkar och marknadsför en rad produkter inom tre olika produktområden; kontor, verktyg och OEM. Denna studie fokuserar på produktutvecklingsprocesserna inom divisionen för kontorsprodukterna vilken kanske är den mest konkurrentutsatta på företaget. Produkterna som tillhandahålls av divisionen är under hårt tryck från konkurrenter på en global basis och snabba och effektiva produktsläpp är av yttersta vikt för att hävda sig på marknaden. De olika aktiviteterna omkring produktutveckling i kombination med de snabba förändringarna av företagets marknadssituation med nya kundgrupper och ökande konkurrens, har lett fram till vissa specifika ofrånkomliga faktorer som har en stor inverkan på produktutvecklingens effektivitet. Detta resonemang leder sedermera fram till uppsatsens syfte.</p><p>Syfte: Syftet med uppsatsen är primärt att identifiera, och påvisa samband mellan, faktorer som påverkar utvecklingen av nya produkter vid Isaberg Rapid AB och sekundärt att påvisa brister i hanteringen av dessa.</p><p>Metod: Syftet har uppfyllts genom att använda en kvalitativ ansats där olika befattningshavare rörande produktutvecklingen på Isaberg Rapid AB har intervjuats. Även observationer har gjorts med avsikten att erhålla en djupare insyn i företagets arbetssätt och ingående funktioner. Referensramens teori och modeller användas för att belysa iakttagelserna i analysen på ett systematiskt sätt och för att förstå syftet. Intervjuerna har utförts enligt en semikonstruerad metod. Utfallet från intervjuerna har sedan analyserats, där fokus i första hand är övergripande, följt av de mer ämnesspecifika frågorna.</p><p>Slutsatser: Vår studie har visat att genom att förbättra sammansättningen mellan långa och korta projekt med hög resp. låg risk kan projektportföljens strategiska och värdemässiga aspekter förbättras. Produktutvecklingen bör fokuseras på att utnyttja projektportföljen som ett kraftfullt instrument, för att utvecklingen inte ska tendera att styras över till orätta projekt på bekostnad av andra mera rätta projekt. Isaberg Rapid måsta således vara ledande inom produktutveckling, och överglänsa konkurrenterna genom att satsa på ny teknologi och våga ta risker, detta uppenbaras av framgångarna med Duax. Effektivare utveckling uppnås endast genom korrekta resursallokeringar och en snabb utvecklingstid, vilket dock fordrar en väl fungerande produktutvecklingsprocess. Då kan syftet infrias och målet uppnås.</p> / <p>Background: There are a number of different factors, affecting the product development process at a company. Isaberg Rapid AB develops, manufacture and sell products within three different business areas; office, tools and OEM. This essay focuses on the product development process at the office division of the company; perhaps the most competitively pressured division of the company. The products handled by the division are under hard pressure from competitors on a global basis and fast and effective product launches are highly important to maintain the position on the market. The activities associated with product development combined with a changing market situation have led to certain inevitable factors that deeply affect the efficiency of the product development process. These arguments eventually lead up to the purpose of this thesis.</p><p>Purpose: The purpose of the thesis is primarily to identify, and point out connections between, factors affecting the development of new products at Isaberg Rapid AB, and secondary to point out failures in the handling of those.</p><p>Method: using a qualitative method where different employees concerned with product development activities at the company have been interviewed has fulfilled the purpose. Observations to obtain a deeper company insight have also been performed. Theories and models from the frame of reference have been used to analyze the empirical findings systematically in order to understand the purpose. The interviews have been held in a semi constructed way. The results form the interviews have been analyzed with both a general focus and later on specified to the identified subjects.</p><p>Conclusions: Our study has shown that the balance of the project portfolio in terms of long and short projects with high and low risk could be improved in terms of value and strategic aspects. Product development should be focused on utilizing the project portfolio as a powerful instrument, in order to avoid that the development tendons to choose a wrong project on behalf of others more right ones. Isaberg Rapid must in this manner leading the product development, and be ahead of its competitors by investing in new technology and be willing of taking risks, that the success with Duax has proven right. Effective product development is achieved by allocating the recourses right and provide for a fast time to market cycle, which however insist on a well-functioned product development. Then can the purpose be fulfilled and the objectives achieved totally.</p>