IDEAS home Printed from https://ideas.repec.org/a/gam/jmathe/v10y2022i9p1601-d810968.html
   My bibliography  Save this article

Roadmap Optimization: Multi-Annual Project Portfolio Selection Method

Author

Listed:
  • Ran Etgar

    (Department of Industrial Engineering, Faculty of Engineering, Ruppin Academic Center, Emek Hefer 4025000, Israel)

  • Yuval Cohen

    (Department of Industrial Engineering, Afeka College for Engineering, Mivtza Kadesh 38, Tel Aviv 6910717, Israel)

Abstract

The process of project portfolio selection is crucial in many organizations, especially R&D organizations. There is a need to make informed decisions on the investment in various projects or lack thereof. As the projects may continue over more than 1 year, and as there are connections between various projects, there is a need to not only decide which project to invest in but also when to invest. Since future benefits from projects are to be depreciated in comparison with near-future ones, and due to the interdependency among projects, the question of allocating the limited resources becomes quite complex. This research provides a novel heuristic method for allocating the limited resources over multi-annual planning horizons and examines its results in comparison with an exact branch and bound solution and various heuristic ones. This paper culminates with an efficient tool that can provide both practical and academic benefits.

Suggested Citation

  • Ran Etgar & Yuval Cohen, 2022. "Roadmap Optimization: Multi-Annual Project Portfolio Selection Method," Mathematics, MDPI, vol. 10(9), pages 1-23, May.
    • Handle: RePEc:gam:jmathe:v:10:y:2022:i:9:p:1601-:d:810968
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2227-7390/10/9/1601/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2227-7390/10/9/1601/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Kopmann, Julian & Kock, Alexander & Killen, Catherine & Gemünden, Hans Georg, 2017. "The role of project portfolio management in fostering both deliberate and emergent strategy," Publications of Darmstadt Technical University, Institute for Business Studies (BWL) 92881, Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL).
    2. F. Perez & T. Gomez, 2016. "Multiobjective project portfolio selection with fuzzy constraints," Annals of Operations Research, Springer, vol. 245(1), pages 7-29, October.
    3. Yongyi Shou & Wenwen Xiang & Ying Li & Weijian Yao, 2014. "A Multiagent Evolutionary Algorithm for the Resource-Constrained Project Portfolio Selection and Scheduling Problem," Mathematical Problems in Engineering, Hindawi, vol. 2014, pages 1-9, April.
    4. Jafarzadeh, M. & Tareghian, H.R. & Rahbarnia, F. & Ghanbari, R., 2015. "Optimal selection of project portfolios using reinvestment strategy within a flexible time horizon," European Journal of Operational Research, Elsevier, vol. 243(2), pages 658-664.
    5. Liesiö, Juuso & Punkka, Antti, 2014. "Baseline value specification and sensitivity analysis in multiattribute project portfolio selection," European Journal of Operational Research, Elsevier, vol. 237(3), pages 946-956.
    6. Jeng, Don Jyh-Fu & Huang, Kuo-Hsin, 2015. "Strategic project portfolio selection for national research institutes," Journal of Business Research, Elsevier, vol. 68(11), pages 2305-2311.
    7. Ehsani, E. & Kazemi, N. & Olugu, E. U. & Grosse, E. H. & Schwindl, K., 2017. "Applying fuzzy multi-objective linear programming to a project management decision with nonlinear fuzzy membership functions," Publications of Darmstadt Technical University, Institute for Business Studies (BWL) 76965, Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL).
    8. Zippy Erlich & Roy Gelbard & Israel Spiegler, 2002. "Data Mining by Means of Binary Representation: A Model for Similarity and Clustering," Information Systems Frontiers, Springer, vol. 4(2), pages 187-197, July.
    9. Xingmei Li & Shu-Cherng Fang & Ye Tian & Xiaoling Guo, 2015. "Expanded model of the project portfolio selection problem with divisibility, time profile factors and cardinality constraints," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 66(7), pages 1132-1139, July.
    10. Pérez, Fátima & Gómez, Trinidad & Caballero, Rafael & Liern, Vicente, 2018. "Project portfolio selection and planning with fuzzy constraints," Technological Forecasting and Social Change, Elsevier, vol. 131(C), pages 117-129.
    11. N. Samphaiboon & Y. Yamada, 2000. "Heuristic and Exact Algorithms for the Precedence-Constrained Knapsack Problem," Journal of Optimization Theory and Applications, Springer, vol. 105(3), pages 659-676, June.
    12. Darius Danesh & Michael J. Ryan & Alireza Abbasi, 2017. "A systematic comparison of multi-criteria decision making methods for the improvement of project portfolio management in complex organisations," International Journal of Management and Decision Making, Inderscience Enterprises Ltd, vol. 16(3), pages 280-320.
    13. James Attwater & Philipp Holliger, 2012. "The cooperative gene," Nature, Nature, vol. 491(7422), pages 48-49, November.
    14. Nassim Dehouche, 2015. "Non-profit project portfolio evaluation and selection: a multi-criteria approach," International Journal of Applied Management Science, Inderscience Enterprises Ltd, vol. 7(4), pages 338-363.
    15. Darius Danesh & Michael J. Ryan & Alireza Abbasi, 2018. "Multi-criteria decision-making methods for project portfolio management: a literature review," International Journal of Management and Decision Making, Inderscience Enterprises Ltd, vol. 17(1), pages 75-94.
    16. Hassanzadeh, Farhad & Nemati, Hamid & Sun, Minghe, 2014. "Robust optimization for interactive multiobjective programming with imprecise information applied to R&D project portfolio selection," European Journal of Operational Research, Elsevier, vol. 238(1), pages 41-53.
    17. Nicholas G. Hall & Daniel Zhuoyu Long & Jin Qi & Melvyn Sim, 2015. "Managing Underperformance Risk in Project Portfolio Selection," Operations Research, INFORMS, vol. 63(3), pages 660-675, June.
    18. Fliedner, Thomas & Liesiö, Juuso, 2016. "Adjustable robustness for multi-attribute project portfolio selection," European Journal of Operational Research, Elsevier, vol. 252(3), pages 931-946.
    19. Kalashnikov, Vyacheslav & Benita, Francisco & López-Ramos, Francisco & Hernández-Luna, Alberto, 2017. "Bi-objective project portfolio selection in Lean Six Sigma," International Journal of Production Economics, Elsevier, vol. 186(C), pages 81-88.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Vijaya Dixit & Manoj Kumar Tiwari, 2020. "Project portfolio selection and scheduling optimization based on risk measure: a conditional value at risk approach," Annals of Operations Research, Springer, vol. 285(1), pages 9-33, February.
    2. Kosztyán, Zsolt T. & Katona, Attila I. & Kuppens, Kurt & Kisgyörgy-Pál, Mária & Nachbagauer, Andreas & Csizmadia, Tibor, 2022. "Exploring the structures and design effects of EU-funded R&D&I project portfolios," Technological Forecasting and Social Change, Elsevier, vol. 180(C).
    3. Khalifa Mohammed Al-Sobai & Shaligram Pokharel & Galal M. Abdella, 2020. "Perspectives on the Capabilities for the Selection of Strategic Projects," Sustainability, MDPI, vol. 12(19), pages 1-20, October.
    4. Masoud Rahiminezhad Galankashi & Farimah Mokhatab Rafiei & Maryam Ghezelbash, 2020. "Portfolio selection: a fuzzy-ANP approach," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 6(1), pages 1-34, December.
    5. Liesiö, Juuso & Kee, Taeyoung & Malo, Pekka, 2024. "Modeling project interactions in multiattribute portfolio decision analysis: Axiomatic foundations and practical implications," European Journal of Operational Research, Elsevier, vol. 316(3), pages 988-1000.
    6. Kajal Chatterjee & Sheikh Ahmed Hossain & Samarjit Kar, 2018. "Prioritization of project proposals in portfolio management using fuzzy AHP," OPSEARCH, Springer;Operational Research Society of India, vol. 55(2), pages 478-501, June.
    7. Zhang, Xinwei & Yan, Yong & Wang, Lilin & Wang, Yang, 2024. "A ranking approach for robust portfolio decision analysis based on multilinear portfolio utility functions and incomplete preference information," Omega, Elsevier, vol. 122(C).
    8. Wu, Yunna & Xu, Chuanbo & Ke, Yiming & Li, Xinying & Li, Lingwenying, 2019. "Portfolio selection of distributed energy generation projects considering uncertainty and project interaction under different enterprise strategic scenarios," Applied Energy, Elsevier, vol. 236(C), pages 444-464.
    9. Dalton Garcia Borges de Souza & Erivelton Antonio dos Santos & Nei Yoshihiro Soma & Carlos Eduardo Sanches da Silva, 2021. "MCDM-Based R&D Project Selection: A Systematic Literature Review," Sustainability, MDPI, vol. 13(21), pages 1-34, October.
    10. Pohl, Erik & Geldermann, Jutta, 2024. "Selection of multi-criteria energy efficiency and emission abatement portfolios in container terminals," European Journal of Operational Research, Elsevier, vol. 316(1), pages 386-395.
    11. Quezada, Luis E. & López-Ospina, Héctor A. & Ortiz, César & Oddershede, Astrid M. & Palominos, Pedro I. & Jofré, Paulina A., 2022. "A DEMATEL-based method for prioritizing strategic projects using the perspectives of the Balanced Scorecard," International Journal of Production Economics, Elsevier, vol. 249(C).
    12. Fausto Balderas & Eduardo Fernandez & Claudia Gomez-Santillan & Nelson Rangel-Valdez & Laura Cruz, 2019. "An Interval-Based Approach for Evolutionary Multi-Objective Optimization of Project Portfolios," International Journal of Information Technology & Decision Making (IJITDM), World Scientific Publishing Co. Pte. Ltd., vol. 18(04), pages 1317-1358, July.
    13. Liesiö, Juuso & Salo, Ahti & Keisler, Jeffrey M. & Morton, Alec, 2021. "Portfolio decision analysis: Recent developments and future prospects," European Journal of Operational Research, Elsevier, vol. 293(3), pages 811-825.
    14. Faraz Salehi & S. Mohammad J. Mirzapour Al-E-Hashem & S. Mohammad Moattar Husseini & S. Hassan Ghodsypour, 2023. "A bi-level multi-follower optimization model for R&D project portfolio: an application to a pharmaceutical holding company," Annals of Operations Research, Springer, vol. 323(1), pages 331-360, April.
    15. Mavrotas, George & Makryvelios, Evangelos, 2021. "Combining multiple criteria analysis, mathematical programming and Monte Carlo simulation to tackle uncertainty in Research and Development project portfolio selection: A case study from Greece," European Journal of Operational Research, Elsevier, vol. 291(2), pages 794-806.
    16. Maciej Nowak & Tadeusz Trzaskalik, 2022. "A trade-off multiobjective dynamic programming procedure and its application to project portfolio selection," Annals of Operations Research, Springer, vol. 311(2), pages 1155-1181, April.
    17. Seunghoon Lee & Young Hoon Lee & Yongho Choi, 2019. "Project Portfolio Selection Considering Total Cost of Ownership in the Automobile Industry," Sustainability, MDPI, vol. 11(17), pages 1-17, August.
    18. Fliedner, Thomas & Liesiö, Juuso, 2016. "Adjustable robustness for multi-attribute project portfolio selection," European Journal of Operational Research, Elsevier, vol. 252(3), pages 931-946.
    19. Panos Xidonas & Haris Doukas & George Mavrotas & Olena Pechak, 2016. "Environmental corporate responsibility for investments evaluation: an alternative multi-objective programming model," Annals of Operations Research, Springer, vol. 247(2), pages 395-413, December.
    20. Sushil, 2019. "Efficient interpretive ranking process incorporating implicit and transitive dominance relationships," Annals of Operations Research, Springer, vol. 283(1), pages 1489-1516, December.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jmathe:v:10:y:2022:i:9:p:1601-:d:810968. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.