R&D Portfolio Selection Considering Risk and Project Interrelations

Evaluation of technologies from a portfolio's perspective means evaluation of a set or subset of R&D projects together and in relation to one another. Decisions have to be taken which projects should be continued, prioritised, de-prioritised or stopped. Characteristics of this process are uncertainty, changing information, multiple objectives and interrelations among projects. Thus the flexibility to react to changing situations should be incorporated into the valuation. Besides monetary issues an important aspect of R&D projects is to gain knowledge in a field that can be used for follow-up projects, product development, patents, the creation of networks, publications etc. Consequently the evaluation should not just focus on financial aspects, but also take the multi-dimensional character of R&D projects into account. In this work a model and a prototypical reference implementation of a framework for the evaluation of R&D projects is proposed, that accounts for multi-dimensional aspects and the risk of these projects. The framework allows for the selection of a portfolio of R&D projects considering limited resources, risk limits and various interrelations between the projects.

Autorentext

Bettina Schauer, PhD: born 6.Oct.1977 in Vienna; studied BusinessInformatics at the University of Vienna and the TechnicalUniversity of Vienna; since 2005 Scientific Assistant andLecturer at the University of Applied Sciences Burgenland inEisenstadt, Austria.

Klappentext

Evaluation of technologies from a portfoliös perspective means evaluation of a set or subset of R&D projects together and in relation to one another. Decisions have to be taken which projects should be continued, prioritised, de-prioritised or stopped. Characteristics of this process are uncertainty, changing information, multiple objectives and interrelations among projects. Thus the flexibility to react to changing situations should be incorporated into the valuation. Besides monetary issues an important aspect of R&D projects is to gain knowledge in a field that can be used for follow-up projects, product development, patents, the creation of networks, publications etc. Consequently the evaluation should not just focus on financial aspects, but also take the multi-dimensional character of R&D projects into account. In this work a model and a prototypical reference implementation of a framework for the evaluation of R&D projects is proposed, that accounts for multi-dimensional aspects and the risk of these projects. The framework allows for the selection of a portfolio of R&D projects considering limited resources, risk limits and various interrelations between the projects.