To read this content please select one of the options below:

A new strategic approach for R&D project portfolio selection using efficiency-uncertainty maps

Mehdi Namazi (School of Progress Engineering, Iran University of Science and Technology, Tehran, Iran)
Madjid Tavana (Department of Business Systems and Analytics, School of Business, La Salle University, Philadelphia, Pennsylvania, USA) (Business Information Systems Department, University of Paderborn, Paderborn, Germany)
Emran Mohammadi (School of Industrial Engineering, Iran University of Science and Technology, Tehran, Iran)
Ali Bonyadi Naeini (School of Progress Engineering, Iran University of Science and Technology, Tehran, Iran)

Benchmarking: An International Journal

ISSN: 1463-5771

Article publication date: 2 January 2023

44

Abstract

Purpose

New business practices and the globalization of markets force firms to take innovation as the fundamental pillar of their competitive strategy. Research and Development (R&D) plays a vital role in innovation. As technology advances and product life cycles become shorter, firms rely on R&D as a strategy to invigorate innovation. R&D project portfolio selection is a complex and challenging task. Despite the management's efforts to implement the best project portfolio selection practices, many projects continue to fail or miss their target. The problem is that selecting R&D projects requires a deep understanding of strategic vision and technical capabilities. However, many decision-makers lack technological insight or strategic vision. This article aims to provide a method to capitalize on the expertise of R&D professionals to assist managers in making informed and effective decisions. It also provides a framework for aligning the portfolio of R&D projects with the organizational vision and mission.

Design/methodology/approach

This article proposes a new strategic approach for R&D project portfolio selection using efficiency-uncertainty maps.

Findings

The proposed strategy plane helps decision-makers align R&D project portfolios with their strategies to combine a strategic view and numerical analysis in this research. The proposed strategy plane consists of four areas: Exploitation Zone, Challenge Zone, Desperation Zone and Discretion Zone. Mapping the project into this strategic plane would help decision-makers align their project portfolio according to the corporate perspectives.

Originality/value

The new approach combines the efficiency and uncertainty dimensions in portfolio selection into an integrated framework that: (i) provides a complete representation of the stochastic decision-making processes, (ii) models the endogenous uncertainty inherent in the project selection process and (iii) proposes a computationally practical and visually unique solution procedure for classifying desirable and undesirable R&D projects.

Keywords

Acknowledgements

The authors would like to thank the editor and the anonymous reviewers for their insightful comments and suggestions.

Citation

Namazi, M., Tavana, M., Mohammadi, E. and Bonyadi Naeini, A. (2023), "A new strategic approach for R&D project portfolio selection using efficiency-uncertainty maps", Benchmarking: An International Journal, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/BIJ-02-2022-0129

Publisher

:

Emerald Publishing Limited

Copyright © 2022, Emerald Publishing Limited

Related articles