A Case Study on Portfolio Management Implementation and Its Relation with Product Development Process in a Company from the Process Industry

With the increasing levels of market competitiveness many companies realise the importance of planning product families and managing its portfolio. In this sense, this paper describes an implementation of a portfolio management system in a company within the process industry. The company has 13 platform projects, from which a number of derivative projects are derived from each platform. This portfolio is analysed before projects are considered for development based on a scoring system. Projects are rated on criteria such as: type of project, level of innovation, technological difficulty, objective, selling forecast, and strategic importance. Prioritisation is then established using a 1 to 5 Lickert scale and resources are allocated to prioritised projects. The company set up a project committee either to manage its portfolio or to analyse the performance each development project individually as the project goes to the development process. The paper also highlights the link between the portfolio management and the new product development process. An analysis of projects with regard to how novel they are to the company and to the markets is outlined as well. The paper concludes that the portfolio management implementation was effective and well-aligned with company strategy although some adjustments were necessary