Project Prioritization is Not Enough: Why No One Uses Optimization for R&D Portfolio Management, and Why You Should
R&D-driven organizations face the constant challenge of deciding whether to continue funding existing projects and when to start new initiatives. The overwhelming majority of firms will use project prioritization to rank the opportunities as part of that exercise, with a small minority suspecting that optimization is better suited to the task of project selection.
So if is it so well-suited to the task, why isn’t optimization used and how should it be used?
Why (Almost) No One Uses Optimization
Optimization seems like something for hard-core geeks, a method that would be hard to understand and even harder to explain to management. How could we possibly explain something that throws around terms like ‘simplex’, ‘branch and bound’, and ‘simulated annealing’?
