2: Strategies and Dilemmas II Flashcards
What are some critical forces that create dilemmas for profitability?
1: Are R&D lead times becoming shorter or longer?
2: Shrinking product life-cycles
3: Diverse and rapidly changing technologies
4: Increased R&D cost
5: Products are becoming more complex
6: Intense international competition
7: Fragmented, demanding markets
8: Environmental concern
9: Digitalization
Needed capabilities: Speed and flexibility (to solve the problems above)
What is the product “danger zone”?
When a product life cycle is shorter than the development lead-time (See: https://imgur.com/a/MMCs0we)
What are some advantages to being first to market?
1: Enjoy a longer product life
2: Faster pay-back time
3: Faster reaction to evolving market demands
4: Faster use of emerging new techonlogies
5: Set a higher market price
6: Enjoy scale effects
7: Establish industry standards
What is a product family, product platform and platform derivatives?
Product family: A group of realted product that share common features, components or subsystems and satisfies a variety of markets.
Product platforms: The set of features, components or subsystems that remain constant from product to product within a product family
Derivatives: Products derived from the product platform
What is the difference between portfolio management and project management?
Portfolio management: To do the right things
Project management: To do the things right
What is project portfolio mangement?
1: A dynamic decision process where active projects and R&D is constantly revised.
2: Evaluation, selection and prioritzation of new projects
3: Resource allocation, project acceleration, reprioritization or discountinuation.
4: Decisions are characterized by uncertain and changing information, dynamic opportunities, multiple goals and strategic decision makers.
What is the goal of project portfolio mangement?
A company’s capability to manage its portfolio of projects in order to maximize return on investment, meaning:
Maximize value of the portfolio
Achive a balanced portfolio
Have a strong link to strategy
What are the reasons for project portfolio management? (PPM)
1: Facilitate the choice of the right projects for the future
2: An important way to operationalize the busniess strategy
3: A way to hadle resources
What are the specific reasons for the importance of project portfolio management? (PPM)
1: The right balance between projects and investments
2: Internal communication of project priorities
3: Providing greater objectivity in project selection
What is needed to create a portfolio that meets the overall objectives PPM?
1: A formal selection process
2: A review process ensuring that the portfolio in its entirety remain to be right one as time ecolves and projects progress
What are some tools and methods to support the goals of project portfolio management?
Maximize value of portfolio: Not present value, expected commercial value, options pricing theory, scoring models
Achieve a balanced portfolio: Bubble diagrams, portfolio maps, histograms, pie charts
Have strong link to strategy: Top-Down (ex. strategic buckets), Bottom-Up (ex. scoring models with strategic parameters)
