Chalmers. Project Portfolio Management in New Product Development Organizations Application of accepted PPM theories in practice Master of Science Thesis in the Master’s Program International Project Management

Chalmers. Project Portfolio Management in New Product Development Organizations Application of accepted PPM theories in practice Master of Science Thesis in the Master’s Program International Project Management

1 Introduction
Project Portfolio management (PPM) is an area within project management which has
become more and more popular among organizations and academics during the last
decade. This thesis will analyze PPM both from a practical and academic perspective
and present how PPM theory is applied in organizations. PPM can be especially
beneficial for NPD organizations, due to the fact that these organizations depend on
the projects selected to day to become the product winners tomorrow. This thesis will
focus on these kinds of organizations and present what aspects of the PPM theory are
the most important for them. This thesis should contain everything needed for NPD
organization to illustrate how they should implement PPM and what aspects of the
theory they should focus on.
1.1 Purpose and research questions
The purpose of this master’s thesis is first of all to analyze the presented PPM theory
and summarize why and how PPM should be implemented within organizations
dealing with multiple projects. This is done by reviewing published articles, textbooks
and standards and structuring a literature review that can be used as guidelines for
organizations to realize what benefits can be gained from implementing PPM and
what tools and methods can be used in order to reach these benefits. Secondly, the
purpose is to perform a case study within two organizations and analyze how they
apply PPM theories in practice. Lastly, the purpose is also to provide the two
organizations with recommendations of how they can improve their practices in order
to become more efficient in selecting, maintaining and coordinating the projects
within their project portfolios. The purpose can be summarized in the following
research questions for this thesis:
 How are the project portfolio management practices within the organizations
applied compared to the theories presented in the PPM literature?
o What are the most important aspects of the PPM theory for NPD
organizations?
o How can the organizations improve their practices based on the
theories presented in the literature?
o Why should the organizations implement the suggested improvements,
how can they benefit from these improvements?
The main objective of the case study is not to evaluate or grade the PPM practices
within the two organizations, but rather to analyze them in order to be able to compare
them with the literature and individually. By doing so an insight can be established
how the PPM theories are applied in practice and also some recommendations can be
provided to the companies how they could improve their operations and why they
should do so.
The popularity of PPM theory has increased significantly during the last decade
(Chapter 3.2.2) and a lot of theory has been published. The problem that this thesis is
intended to solve is that it can be time consuming for companies to analyze this huge
collection of articles, books and so forth in order to find the relevant theory that they
can use to support implementation or improvements of their PPM practices. The

author of this thesis conducted a comprehensive search for a critical review of PPM
literature from the NPD perspective without success. This thesis will contain such a
review.
A literature review is presented and a case study research constructed to give a
practical view of how PPM theory is applied in practice. This case study is then
compared to the literature review and conclusions are drawn about what aspects of the
theory are the most important ones for NPD organization. This report can be used by
other NPD organizations as guidelines of how they can implement or improve their
PPM practices. Killen et al. (2007) stated that the empirical research within the field
of PPM was very limited and although several empirical research have published
since then, the author of this thesis thinks that more attention needs to be given to this
research area. This thesis is an honest contribution.
1.2 Limitations
The biggest limitations of this research are time constrains and resources. This thesis
is constructed by a single student which limits the case study to only two
organizations. It would have been better to expand the case study to several more
organizations to have more data to be able to generalize how the PPM theories are
applied in practice.
Because of the author’s the background and interest, this thesis is written from a
project management perspective rather than product development perspective. A more
product development orientated approach on similar topics can be found a master’s
thesis from Chalmers by Svennung and Söderström (2008) or the doctor dissertation
from Chalmers by Dawidson (2006).
Although this thesis is written from a project management perspective, it will focus
mainly on PPM within R&D and NPD organizations. PPM can be used in any
industry sectors but it can be especially beneficial within the fields of R&D and NPD.
1.3 Thesis structure overview
This master’s thesis report consists of six chapters. The first chapter introduces the
thesis and presents the purpose, research questions and limitations. The second
chapter introduces the methodology that will be used in order to draw conclusions
about the research questions. The third chapter presents a detailed literature review of
the PPM theory and the fourth chapter presents a case study research that was
constructed within two NPD organizations. The fifth chapter compares the literature
review to the results from the case study and presents a discussion around the research
questions. Recommendations for how the organizations can improve their operations
are also presented in chapter 5. Chapter 6 concludes the report by highlighting the
main findings of this report and presenting the author’s recommendations for future
research. The thesis structure overview in presented in Figure 1.

Chalmers. Project Portfolio Management in New Product Development Organizations Application of accepted PPM theories in practice Master of Science Thesis in the Master’s Program International Project Management