Decision-making Tools to Support Innovation

4Building a Coherent Project Portfolio: An Application of MAUT

Project management is an essential element in the development of a company’s capacity to innovate. Increasing the pace of output of innovative projects can only be done by mastering the resources involved: financial and technical resources, but also time.

However, innovative companies are required to develop several projects simultaneously, which form a project portfolio. Since all companies have limited resources, the construction process of this project portfolio is a recurring problem in innovation. This means that it is necessary to make a selection related to the objectives of decision makers or the concerned organization, but also regarding the overall compatibility of this set of projects, to form a coherent whole. Indeed, as Belton and Stewart (2002) have found, the creation of a project portfolio requires not only giving consideration to the individual characteristics of the alternatives but also the way they interact with each other, and the positive or negative synergies that may arise.

To illustrate this problem, we will draw inspiration from the works of Lopes and Almeida¹ (2013, 2015), aimed at evaluating synergies which allow for the selection of a portfolio of projects, within the specific context of the petroleum industry. This article proposes an application of the multi- attribute utility theory (MAUT) method, relying on the theory of utility developed by Von Neumann and Morgenstern in 1953.