As organizações enfrentam pressão por geração de valor e, para tanto, buscam posicionar-se favoravelmente em seus setores de atuação, o que impõe a necessidade de definir uma estratégia clara e realizar investimentos alinhados a ela. Os investimentos são concretizados por meio de projetos, cuja seleção deve ser conduzida por um processo rigoroso, transparente e objetivo o que pode ser obtido com a definição de critérios de seleção baseados em indicadores quantitativos financeiros. Apesar da existência de muitos trabalhos com foco no alinhamento da carteira de projetos à estratégia do negócio, as discussões são conduzidas de modo qualitativo ou baseadas em exemplos específicos e aplicação de poucos critérios. O presente trabalho avalia, por meio de simulações, as implicações estratégicas dos diferentes tipos de critérios de seleção, incluindo visão de risco e retorno. Em resumo, o critério de maximizar o Valor Presente Líquido seleciona projetos de mais longa duração e fluxos de caixas positivos no longo prazo, o que favorece o crescimento da organização. Uma carteira desta natureza pode adequar-se a empresas que competem em indústrias em ritmo acelerado de crescimento. Os critérios, baseados na Taxa Interna de Retorno e no Índice de Lucratividade, selecionam projetos de elevado retorno sobre o capital investido, o que tende a privilegiar rentabilidade em vez de crescimento. Carteiras com estas características podem favorecer a atuação em indústrias de expressivo volume de mercado, porém baixas taxas de crescimento. Em contrapartida, os critérios baseados no Período de Retorno selecionam projetos de menor duração, cujos retornos ocorrem no curto prazo, característica que pode ser desejada quando a organização atua em uma indústria em declínio ou em linhas de negócio em que pretende desinvestir. / Organizations face pressure for value creation and seek a favorable position in their industry segments, what demands a clear strategy and investments aligned to it. Such investments are implemented through projects, which should be selected by a rigorous, transparent and objective process what can be achieved using quantitative financial criteria for project selection. Although there are several studies focused on the alignment of Project Portfolio to Corporate Strategy, discussions are qualitative in most cases or they are based on few specific selection criteria. In order to present a broader study on the field, this work simulates the strategic implication of different selection criteria, using a risk-reward framework. Major conclusion could be achieved on that way. For example, maximizing the Net Present Value selects long lasting projects with strong cash flow generation in the long term. Such portfolios have good fit for companies competing in high growth industries. Selection criteria based on the Internal Rate of Return or the Profitability Index select high return on investment projects, which drive more profitability than growth. Such portfolios are applicable for companies competing in high volume but low growth industries. On the other hand, criteria based on the Payback Period select short term return projects, which are applicable for companies competing in shrinking industries or in divesting business lines.

Sustainability is one of the main drivers today for change in the world, many organisations are trying to be sustainable in their own way. One of the ways to do this is to integrate sustainability, or the triple bottom line (TBL), in their decision-making. This study concerns developing decision criteria for an NPO operating within the recycling- and waste management sector, to be applied in a project portfolio selection framework. Thus, the purpose of the study is to support decision-making that will promote sustainability by developing decision criteria. Consequently, the main research question for the study is: which criteria assure project selection aligned with TBL? The decision criteria were developed by following the five-step approach for developing criteria by Tillman and Cassone (2012). The research is designed as a qualitative single case study and the research questions are answered by conducting semi-structured interviews. The study has shown that by combining TBL and the five-step approach, criteria were able to be developed promoting all three dimensions of TBL. However, combining TBL and the five-step approach did imply some changes and adjustments to the original five-step approach. Hence, the discussion provides an outline of a suggested framework that integrates the TBL approachinto the development of decision criteria and metrics. / Hållbarhet är en av de viktigaste drivkrafterna för förändring i världen idag och olika organisationer försöker vara hållbara på sitt eget vis. En strategi att göra detta är att integrera hållbarhet, eller triplebottom line (TBL), i sitt beslutsfattande. Denna studie handlar om att utveckla beslutskriterier för tillämpning i ett ramverk för projektportföljstyrning för en icke vinstdrivande organisation som arbetar inom sektorn för återvinning och avfallshantering. Syftet med studien är således att stödja beslutsfattande som främjar hållbarhet genom att utveckla beslutskriterier. Följaktligen är den huvudsakliga forskningsfrågan för studien: vilka kriterier säkerställer att val av projekt är i linje med TBL? Beslutskriterierna utvecklades genom att följa tillvägagångssättet för en femstegsmetod för att utveckla kriterier av Tillman och Cassone (2012). Studien är utformad som en kvalitativ fallstudie och forskningsfrågorna besvaras genom semistrukturerade intervjuer. Studien har visat att genom att kombinera TBL och femstegsmetoden utvecklades kriterier som främjar alla tre dimensioner av TBL. Att kombinera TBL och femstegsmetoden innebar dock vissa förändringar och justeringar av den ursprungliga femstegsmetoden. Diskussionen presenterar därför ett förslag på ett ramverk som integrerar TBL i utvecklingen av beslutskriterier och mätetal.

The annual budget cycle in urban road/transport authorities by implication requires transport infrastructure projects to be ranked in terms of their relative value, to enable project selection by starting from the most deserving proposal. This follows from the fact that the total cost of feasible projects practically always exceeds available funds, signalling the need for some kind of selection protocol. Cost benefit analysis (CBA), when applied in a narrow sense, is not suitable for this purpose as it focuses on economic efficiency only. Attempts to broaden it have been criticized by some scholars. Although the diversity of impacts points to a multi-criteria analysis (MCA) approach, this is considered unscientific in certain quarters; at best, its practical value needs to be demonstrated. In the case of the City of Tshwane (CoT), problems with current project appraisal are evident in that different methods – none of which is defensible – are used, sometimes resulting in rankings that are contradictory. This thesis therefore attempts the following: (a) to develop a basic approach that combines the best elements of traditional methods; (b) to customize this approach to the specific context and needs of road authorities in the municipal sphere of government, using CoT as an example; and (c) to demonstrate the application of the resulting appraisal framework, utilizing appropriate decision-support software for this purpose. Recommendations include the following: An appraisal framework should combine CBA and MCA by adopting an overall MCA approach with economic efficiency – focusing on the optimal allocation of scarce resources – as one of the decision criteria. For completeness‟ sake, three additional decision criteria are deemed necessary: equity (focusing on income distribution impacts); sustainability (focusing on environmental impacts); and compatibility (focusing on the alignment of projects with stated goals and objectives). This framework may well apply to road authorities in other spheres of government – the optimum application in each case will depend on the composition of the relevant decision-making team. The inherent nature of project appraisal requires a two-phased approach in all cases: the evaluation of mutually exclusive alternatives, followed by the ranking of independent projects. State-of-the-art decision support software is indispensable for implementing this framework. / Transport Economics / D. Com. (Transport Economics)

The purpose of this project is to describe and explain the foreign investment decision process in the uncertain and turbulent environment of transition economy. By getting an in-depth understanding of how decision-making works in the environment of transition economy, the study intends to contribute to the development of business administration theory in the area of foreign investment decision-making, particularly its application in the turbulent and uncertain world. Theoretical ‘blocks’, elaborated on the basis of literature study, include the following concepts: the framework of transition economy; initial motivation (or reasons) of companies to make foreign direct investments (FDI); investigation of the investment climate and information collection methods; project evaluation and investment decision criteria; risk assessment factors and risk reduction measures. Transition economy is defined in the study as ‘a non-planned, non-market economy’ where the new emerging market institutions coexist with the bureaucracy and hierarchy inherited from the old administrative system. Investment projects, therefore, should probably be seen as being under institutional influence from both the local (i.e. transition economy) and the Western investor’s home country environments. The empirical data presented in the paper also shows that it is necessary to establish the relevant economic, legal, political and social institutions in order to attract FDI. The study further includes the analysis of the main components and features of transition economies and their influence on FDI decision-making. One of the results of the study is that FDI decision-making in transition economies is largely consistent with different theoretical approaches suggested in the literature. On the other hand, the empirical support obtained for different theoretical approaches is often questionable and opened to alternative interpretations. The presented project suggests that theoretical perspectives do not preclude each other, but rather have a complimentary character. The study attempts to contribute to the mainstream FDI theories through a firm-level approach based on the case studies. Two in-depth case studies are presented in the paper: Ericsson’s direct investments in Russia and Vattenfall’s investments in the Baltic countries. A formal questionnaire based on the parameters of theoretical ‘blocks’ was created and 25 top executives from Ericsson and Vattenfall who participated in FDI decision-making were surveyed. The empirical investigation took place during the period 1997 - 1998 with partial updating of the cases during the year 2000.  The study shows that where companies confront stable environments, investment decision routines and procedures will be less necessary and important than where market uncertainty is high. The strong appreciation of the local business partners for properly done investment calculations increases the importance of capital budgeting in transition economies more than in developed market economies. Besides, traditional investment appraisal methods provide managers with an ‘objective’ or ‘materialistic’ feedback for the decision-making in the rapidly changing uncertain environment. On the other hand, the study emphasises the importance of strategy over financial techniques and argues that FDI decisions in transition economies should be based on methods consistent with the company’s long-term objectives. In case of permanent changes, new approaches as well as better co-ordination of traditional techniques with strategic, political, historical, geographical and cultural issues are required. Ericsson’ s direct investments in Russia are presented in the paper in connection with other factors: the company’s historical involvement in Russia, marketing strategy, human resource development, privatisation and restructuring of the telecommunication sector in Russia, etc. Nordic Electric Power Co-operation (Nordel), the EU’ s decision in 1996 to create an internal electricity market in Europe, Baltic ring study, future plans to privatise the energy companies in the Baltic countries, etc., are the framework to present the second case. An application of project evaluation and risk assessment techniques for broader and more complicated environments shows that investment decision-making is probably as much, if not more, a social, political and cultural technology as an economic one. The study argues then that the rational choice decision-making model often co-exists with alternative models elaborated in social science - limited rationality, political and garbage can. According to the empirical data, the investment decisions are largely based on intuition, business experience and judgement, personal contacts with representatives from the local country, and these investment criteria are inevitable and acceptable in a situation of total chaos and permanent change. The right chosen partner, for example, is one of the major criteria for the success of the investment project in a transition economy. One of the outcomes of this study is that the revitalised form of investment decision-making will differ rather markedly from much of what has gone before: less emphasis on the quantitative aspects of capital budgeting, more on the qualitative aspects of companies and investment environment. The project also argues that determinants, approaches and criteria of investment activity in transition economies are largely consistent with patterns observed in other parts of the world. A few specific environmental conditions of transition economies, however, are shown in the study to affect the pattern of FDI decision-making. The level of turbulence is still different compared to the developed market economies due to uncertainties and unpredictibilities associated with environment of transition economies. Other major differences are the large power distance with authoritarian leadership, strong hierarchy and bureaucracy as well as the vital role of personal contacts in transition economies. It is not clear, however, if these features of transition economies should be seen as inherited from the past communist system or as an alternative way to organise the economic actors through networks, a way that is natural and appropriate for the majority of Asian societies.

The annual budget cycle in urban road/transport authorities by implication requires transport infrastructure projects to be ranked in terms of their relative value, to enable project selection by starting from the most deserving proposal. This follows from the fact that the total cost of feasible projects practically always exceeds available funds, signalling the need for some kind of selection protocol. Cost benefit analysis (CBA), when applied in a narrow sense, is not suitable for this purpose as it focuses on economic efficiency only. Attempts to broaden it have been criticized by some scholars. Although the diversity of impacts points to a multi-criteria analysis (MCA) approach, this is considered unscientific in certain quarters; at best, its practical value needs to be demonstrated. In the case of the City of Tshwane (CoT), problems with current project appraisal are evident in that different methods – none of which is defensible – are used, sometimes resulting in rankings that are contradictory. This thesis therefore attempts the following: (a) to develop a basic approach that combines the best elements of traditional methods; (b) to customize this approach to the specific context and needs of road authorities in the municipal sphere of government, using CoT as an example; and (c) to demonstrate the application of the resulting appraisal framework, utilizing appropriate decision-support software for this purpose. Recommendations include the following: An appraisal framework should combine CBA and MCA by adopting an overall MCA approach with economic efficiency – focusing on the optimal allocation of scarce resources – as one of the decision criteria. For completeness‟ sake, three additional decision criteria are deemed necessary: equity (focusing on income distribution impacts); sustainability (focusing on environmental impacts); and compatibility (focusing on the alignment of projects with stated goals and objectives). This framework may well apply to road authorities in other spheres of government – the optimum application in each case will depend on the composition of the relevant decision-making team. The inherent nature of project appraisal requires a two-phased approach in all cases: the evaluation of mutually exclusive alternatives, followed by the ranking of independent projects. State-of-the-art decision support software is indispensable for implementing this framework. / Transport Economics / D. Com. (Transport Economics)

Coordenação de Aperfeiçoamento de Pessoal de Nível Superior / The publication of Thomas Kuhn s The structure of scientific revolutions is considered a watershed in the philosophy of science for having presented scientific knowledge as produced by a dynamic and historically situated process. Many of the concepts introduced by the author sparked controversy in the initial reception of this work. We highlight in this dissertation Kuhn s theses on scientific revolutions, incommensurability, and scientific choice between rival hypothesis, which were interpreted by authors such as Popper, Lakatos, Laudan and Putnam as introducing elements of irrationality and relativism into Kuhn s analysis of scientific practice. In the first paper of this dissertation, we investigate passages from Structure that led to those interpretations, and track down Kuhn s later reformulations of the three controversial theses, which attempted to avoid or respond the criticisms of irrationality and relativism. We highlight the linguistic emphasis given by Kuhn in his later works to the concepts of incommensurability and scientific revolution, and show that his thesis about scientific choices remained nearly unchanged. We claim that in Kuhn s later works his theses became more precisely formulated and narrower in scope, and that they manifest a realist inclination by the author. The second paper of this dissertation develops in more detail the issue of the rationality of scientific choice. It presents briefly three theories of scientific rationality due to Kuhn, Lakatos and Laudan, and then shows some of the problems that Lakatos and Laudan s theories face due to focusing their notion of rationality on univocal rules of choice. We then indicate that there are advantages in understanding as Kuhn did the notion of rationality in terms of values that influence objectively the choices to be made without determining them univocally. / A publicação de A estrutura das revoluções científicas, de Thomas Kuhn, é considerada um divisor de águas na filosofia da ciência por apresentar o conhecimento científico como sendo gerado por um processo dinâmico e historicamente situado. Muitos dos conceitos introduzidos pelo autor foram motivos de controvérsia na recepção inicial da obra. Destacamos na presente dissertação as teses de Kuhn sobre revoluções científicas, incomensurabilidade e escolhas científicas entre hipóteses rivais, que foram interpretadas por autores como Popper, Lakatos, Laudan e Putnam, como introduzindo elementos de irracionalidade e relativismo na análise kuhniana da atividade científica. No primeiro artigo desta dissertação, investigamos as passagens na Estrutura que levaram a essas interpretações, e rastreamos as reformulações kuhnianas posteriores para as três teses controversas com vistas a evitar ou responder as críticas de irracionalidade e relativismo. Destacamos a ênfase linguística dada por Kuhn aos conceitos de incomensurabilidade e revolução científica, e mostramos que a tese acerca das escolhas científicas permanece quase inalterada nos textos tardios. Defendemos que na obra tardia de Kuhn suas teses tornaram-se mais precisas e menos abrangentes e evidenciam uma inclinação realista do autor. O segundo artigo desta dissertação desenvolve de maneira mais detalhada a questão da racionalidade das escolhas científicas, apresentando as propostas de três teorias historicistas da racionalidade científica, devidas a Kuhn, Lakatos e Laudan. Apresentamos alguns dos problemas que as teorias de Lakatos e Laudan enfrentam ao concentrar a noção de racionalidade em regras unívocas de escolha e indicamos que há vantagens em se compreender a noção de racionalidade em termos de valores que influenciam objetivamente as escolhas sem determiná-las univocamente, como propôs Kuhn.

The proposition of this dissertation is that superior capital budgeting solutions can be attained by not only analyzing projects individually but rather as part of a portfolio of projects that has the objective of maximizing the company’s range of multiple objectives, not only the economic benefit. The dissertation starts with a detailed study of current techniques and an assessment of flaws and shortcomings. This study concludes with the requirements that any new approach or model must address in order to improve on the current practices. Based on these requirements, a new model is developed based on the portfolio approach that integrates all the assumptions, constraints, project and variable interrelationships. An important feature of the model is that it selects its portfolio of capital projects in such a way that it optimizes support for the company’s multiple objectives, not only the economic objective. The dissertation concludes with the application of this model to a hypothetical case. It is concluded that, by developing and using this model, a company can improve the analysis required before capital budgets are finalized. / Dissertation (MEng (Industrial Engineering))--University of Pretoria, 2006. / Industrial and Systems Engineering / unrestricted