iUNIVERSITY OF SALFORDBUSINESS SCHOOLBUILDING A PROJECT PORTFOLIO IN THE SOCIALENTERPRISE. ANALYSIS AND IMPLEMENTATION OFP...
iiDeclarationI declare that no part of this dissertation has been taken from existing published orunpublished material wit...
iiiAbstractTitle of dissertation: Building a project portfolio in the social enterprise. Analysis andimplementation of pro...
ivTable of ContentI. Chapter: Introduction...................................................................................
v2. Primary research ........................................................................................................
viTable of GraphsGraph 1. Different positions and roles of social enterprises ...............................................
viiList of TablesTable 1. Scoring method ....................................................................................
viiiPrefaceAcknowledgementsSpecial thanks to Jan Andreasik how inspired me to analyse the project portfoliomanagement for ...
ixPersonal statementAfter two years of developing the social enterprise – SIFE Salford as a Chairman and thenVice-Presiden...
1I. Chapter: Introduction1. IntroductionBackground of the researchSocial enterprises are independent businesses that provi...
2Graph 1. Different positions and roles of social enterprises (Ridley-Duff, 2007)From the graph above the observation can ...
3Significance and importance of the researchAccording to Cabinet Office (2008) there are at least 55,000 social enterprise...
4Aim of the researchTo solve this problem the Multi-Criteria Decision Analysis (MCDA) needs to be implemented.The aim of M...
5project management and social enterprises. Further, they will participate in interviews toassess three example projects b...
6 Implementation of the Multi-Criteria Decision method – Analytical HierarchyProcess (AHP) in social enterprise, on the c...
7II. Chapter: Literature reviewThe main area of study concerns Project Portfolio Management (PPM) and the literaturereview...
8new product. On the other hand, Miguel (2008) findings about project portfolio state thatthe concept evaluated from proje...
9speaking about project portfolio in further stages of this study the reference to this finaldefinition will be made.The d...
10Graph 2. Bubble diagram of a portfolio of new-product projects (Source: Cooper et al.1997, p.24)The above graph introduc...
11Consequently, it is important to create the project portfolio that is balanced. Also, theprojects undertaken should foll...
12The most detailed approach regarding development of project portfolio has been evaluatedby Wysocki and McGary (2003). Th...
13against created criteria and classified appropriately. Once the projects are categorized thenext phase can begin (McGary...
142.3.4. Selecting Balanced Portfolio Using the PrioritizedProjectsThe next phase aims to create a balanced portfolio of p...
15Management Office (PMO) which gathers financial and work progress perspective updatesfrom project leaders. This informat...
16On the other hand, PMBOK (2004) states that the project life cycle defines the phases thatconnect the beginning of a pro...
17In overall, those models present that project that is going through various stages. In each ofthem there are different t...
18 Having a structure in place to select the right projects and immediately remove thewrong projects; Placing resources ...
193. Project Selection methodsAs revealed by the President of SIFE Salford (studied organization) there is no structuredse...
20Graph 8. Process of managing portfolios successfully (Rad, 2006, p.127)Difficulty of selecting a projectGraves (2002) ou...
21Heldman (2007) outlines that a criteria weighting method lays within scoring modelssection. Furthermore, these methods a...
22constraints. Cleland (2003) focuses on criteria such as risk, profit margin and duration. Forthe purpose of the research...
23According to Cooper (2001) thescores given by projects become a proxy for the value of theproject. However, it includes ...
243.2.Analytical Hierarchy Process methodMulti-criteria decision makingAccording to Al-Harbi (1999, p.19) project, portfol...
25 Decision Weights – the criteria are given weights representing their importance Decision Matrix – each problem analys...
26Marzouk, M. (2008) Contractor selectionHatush, Z. and Skitmore, M. (1998) Contractor selectionMota, C. M. M., Almeida, A...
27The Analytic Hierarchy ProcessThe method s has been developed by Saaty (1980; 1994; 2001), therefore it is essential tou...
28Principles in AHP ProcessSaaty’s AHP method (2001) utilizes these principles in AHP process incorporating both thequalit...
29The Analytic Hierarchy Process is a complicated mathematical method, which helps a lotwith decision making. However, if ...
30Advantages of AHPGraph 9. Advantages of the Analytic Hierarchy Process (own study based on Saaty, 2001, p.25)AHPUnity: T...
31Other authors also recognize other advantages of AHP method. Al-Harbi (199) states that AHP allowsconsideration of multi...
32 Truthfulness by not oversimplifying complexity Justice by evaluating costs and benefits and assigning costs to those ...
33III. Chapter: MethodologyAs an academic activity, the research should be conducted in a systematic, organised and planne...
34 Methods: the techniques or procedures used to gather and analyse data related to someresearch question or hypothesisKu...
35Graph 11. Types of research (Source: Kumar, 2005, p.9)The three classifications are not mutually exclusive (Kumar, 2005,...
36as a qualitative research, which allows greater flexibility than quantitative. Therefore it is mostly usedto investigate...
37Graph 12. A classification of secondary data (own study based on Malhotra, 2007, p.100)The collection and analysis of se...
38approach needs to be implemented in such case and it requires the researcher to justify his or herreasons for choosing a...
39In the third stage experts will be asked to assess and choose the projects once again, but using ExpertChoice software t...
40Design of the surveyThe objective of the survey was to identify the most important criteria for project selection. Tocre...
41LimitationsSaunders (2007, p.531) states that any research has its limitations such as the size of the sample andthe sna...
42Design of interviewParticipants will be shown the first method of assessing the projects by comparing projectdescription...
43Stage 3: Expert Choice assessmentObjectiveThe aim of this assessment is to show alternative method for selecting the pro...
44the PC implementation, Expert Choice allowed growth of AHP applications around the world acrossindustries.Wyatt (1999, p...
45Expert choice assessment step by stepStep 1: Set up of the assessment fileGraph 13. Expert Choice main screenThe main sc...
46Graph 14. Expert Choice criteria analysisThe assessment of those criteria will give them a rate that will be used furthe...
47First option is on the scale from 1 to 9, where 1 shows that criteria or options are equal and highermarks illustrate ad...
48Graph 18. Expert Choice decision screen 3The expert may choose which method of assessment is more suitable for him or he...
49Data collectionExperts will be shown how the software works and then on the computer with the licensed softwarewill asse...
50SummaryThe research aims to address the objectives and gather data that will allow further analysis, whichwill result in...
51IV. Chapter: Research Findings and ResultsThis chapter focuses on the analysis of the results and findings from research...
52Graph 19. Detailed survey analysisAfter gathering and analysis of the results the ranking of the criteria chosen by the ...
53Position Criteria Rating Average1 Financial stability (of an external organization) 4.502 Payback (time needed to recove...
542. Interview resultsThe interviews had been performed as an open discussion welcoming comments regarding everyaspect of ...
55method gives deeper analysis and more accurate scores. Furthermore, PoSS appraised the ExpertChoice software as easy to ...
56AHP/Expert Choice: Confronts criteria as well as projects Gives more complex results Difficult to get the same result...
57Interview 3: Community & Volunteering Manager (CVM) Comments on the criteria chosen by the experts through surveyCVM wa...
58CVM would adjust the criteria to the organization and case, then ask external organization writeproposal in bit more det...
59 Implementation of the selection methodsIPA would generally improve the criteria and adjust them to the organization th...
604. Assessment results and applications of the Expert ChoiceEach expert has learnt how to use the Expert Choice which is ...
61V. Analysis and DiscussionThis chapter brings together analysis of the literature and researches of other authors and re...
62there is a big flow of volunteers and average time worked is one year. Furthermore, Levine (2007)and Westerveld (2003) o...
63In summary, the five project criteria concluded through survey and commented in interviews are themost appropriate for t...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case stud...
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Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case study of SIFE Salford.

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The dissertation aims to help the social enterprise – SIFE Salford with creating the portfolio of projects. The paper focuses on selection method that the organization may use while choosing from the projects submitted by external enterprises. This process is very complex and it is often difficult to make sound decisions, therefore introducing the methods and the process is essential and beneficial for every organization. The author examines two methods: the scoring and Analytical Hierarchy Process (AHP). The analysis of those methods is made to decide which one is more suitable and useful for a studied organization. Furthermore, the methods are analysed and studied how they can be applied and used in social enterprises. The survey and interviews with experts from the field aim to create guidelines for the SIFE Salford, how to use the techniques and benefit from them. Consequently, the President and Directors of the enterprise are trained during interview process to use studied methods that they can easily implement in upcoming academic year.
This condenses the aim of the dissertation, which is to experiment the selection methods that could be a practical use for a social enterprise to ease a process of selecting process. It also introduces the concept of project portfolio management into the sector.

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Transcript of "Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case study of SIFE Salford."

  1. 1. iUNIVERSITY OF SALFORDBUSINESS SCHOOLBUILDING A PROJECT PORTFOLIO IN THE SOCIALENTERPRISE. ANALYSIS AND IMPLEMENTATION OFPROJECT SELECTION METHODS. CASE STUDY OF SIFESALFORD.MARIUSZ ANDREASIKDissertation submitted in partial fulfilment of requirements for thedegree of MSc in Project Management.University of Salford 2009.
  2. 2. iiDeclarationI declare that no part of this dissertation has been taken from existing published orunpublished material without due acknowledgement and that all secondary material usedtherein has been fully referenced.Signed ..............................................
  3. 3. iiiAbstractTitle of dissertation: Building a project portfolio in the social enterprise. Analysis andimplementation of project selection methods. Case study of SIFE Salford.Author: Mariusz AndreasikSummary:The dissertation aims to help the social enterprise – SIFE Salford with creating the portfolioof projects. The paper focuses on selection method that the organization may use whilechoosing from the projects submitted by external enterprises. This process is very complexand it is often difficult to make sound decisions, therefore introducing the methods and theprocess is essential and beneficial for every organization. The author examines twomethods: the scoring and Analytical Hierarchy Process (AHP). The analysis of those methodsis made to decide which one is more suitable and useful for a studied organization.Furthermore, the methods are analysed and studied how they can be applied and used insocial enterprises. The survey and interviews with experts from the field aim to createguidelines for the SIFE Salford, how to use the techniques and benefit from them.Consequently, the President and Directors of the enterprise are trained during interviewprocess to use studied methods that they can easily implement in upcoming academic year.This condenses the aim of the dissertation, which is to experiment the selection methodsthat could be a practical use for a social enterprise to ease a process of selecting process. Italso introduces the concept of project portfolio management into the sector.
  4. 4. ivTable of ContentI. Chapter: Introduction.................................................................................................................11. Introduction ...............................................................................................................................12. Research objectives....................................................................................................................5II. Chapter: Literature review .........................................................................................................71. Project........................................................................................................................................72. Project Portfolio .........................................................................................................................72.1. Project Portfolio Management...............................................................................................82.2. Balanced Portfolio..................................................................................................................92.3. Operating a Project Portfolio ...............................................................................................112.3.1. Establishing Portfolio Strategy .........................................................................................122.3.2. Evaluating Project Alignment to the Portfolio Strategy....................................................122.3.3. Prioritizing and selecting Projects....................................................................................132.3.4. Selecting Balanced Portfolio Using the Prioritized Projects..............................................142.3.5. Managing the Active Projects...........................................................................................142.3.6. Summary of project portfolio development.....................................................................152.4. Project life cycle ...................................................................................................................152.5. Benefits of project portfolio.................................................................................................172.6. Problems ..............................................................................................................................183. Project Selection methods .......................................................................................................193.1. Criteria weighting method ...................................................................................................203.2. Analytical Hierarchy Process method...................................................................................24III. Chapter: Methodology .............................................................................................................331. Secondary research..................................................................................................................36
  5. 5. v2. Primary research ......................................................................................................................37Stage 1: Survey.................................................................................................................................39Stage 2: Interview ............................................................................................................................41Stage 3: Expert Choice assessment ..................................................................................................433. Ethical issues ............................................................................................................................49Summary..........................................................................................................................................50IV. Chapter: Research Findings and Results...................................................................................511. Survey Results ..............................................................................................................................512. Interview results...........................................................................................................................543. Results of scoring method assessment ........................................................................................594. Assessment results and applications of the Expert Choice...........................................................60V. Analysis and Discussion............................................................................................................61VI. Conclusions and recommendations .........................................................................................71Reflection on the extent to which the research aims were accomplished...........................................73Appendix 1: Survey implementation....................................................................................................74Appendix 2: Project Descriptions .........................................................................................................76Appendix 3: Interview questions..........................................................................................................79Appendix 4: Overview of SIFE Salford (studied social enterprise)........................................................80Appendix 5: Transcript of interviews ...................................................................................................81Appendix 6: Scoring method assessment results.................................................................................87Appendix 7: AHP method assessment results......................................................................................91References ...........................................................................................................................................95
  6. 6. viTable of GraphsGraph 1. Different positions and roles of social enterprises ..................................................................2Graph 2. Bubble diagram of a portfolio of new-product projects........................................................10Graph 3. Project Portfolio Management..............................................................................................11Graph 4. Project Life Cycle ...................................................................................................................15Graph 5. Project Life Cycle ...................................................................................................................16Graph 6. Project Life Cycle ...................................................................................................................16Graph 7. Portfolio project life cycle......................................................................................................17Graph 8. Process of managing portfolios successfully..........................................................................20Graph 9. Advantages of the Analytic Hierarchy Process ......................................................................30Graph 10. Four elements of research...................................................................................................33Graph 11. Types of research ................................................................................................................35Graph 12. A classification of secondary data .......................................................................................37Graph 13. Expert Choice main screen ..................................................................................................45Graph 14. Expert Choice criteria analysis.............................................................................................46Graph 15. Expert Choice project assessment screen ...........................................................................46Graph 16. Expert Choice decision screen 1 ..........................................................................................47Graph 17. Expert Choice decision screen 2 ..........................................................................................47Graph 18. Expert Choice decision screen 3 ..........................................................................................48Graph 19. Detailed survey analysis ......................................................................................................52Graph 20. Combined results of AHP assessment .................................................................................60
  7. 7. viiList of TablesTable 1. Scoring method ......................................................................................................................22Table 2. Explanation of rating answers ................................................................................................40Table 3. Categories of problems that have been addressed by Expert Choice.....................................44Table 4. Ranking of the criteria ............................................................................................................53Table 5. Results of scoring method assessment...................................................................................59
  8. 8. viiiPrefaceAcknowledgementsSpecial thanks to Jan Andreasik how inspired me to analyse the project portfoliomanagement for the SIFE Salford, after expressing big interest in the enterprise activities.Further thanks to Marta Karaś for supporting me throughout the process of researching andwriting up the dissertation.Thanks to Łukasz Szczekala for a company while writing the dissertation, especially duringthe breaks between the chapters or sections.I would like to thank my supervisor Kevin Kane for the great and smooth cooperation whileworking on this dissertation.
  9. 9. ixPersonal statementAfter two years of developing the social enterprise – SIFE Salford as a Chairman and thenVice-President, leading the team to semi-finals of United Kingdom national competitions, Ihave decided to research techniques that could help with further development of theoperations. The main challenge we faced was choosing the right projects to commit to. Wehad made few wrong decisions, when we worked on a project which was not beneficial toour organization and did not meet our strategic objectives; therefore it was complete wasteof resources and time. Consequently, I focused this dissertation around the methods thatcould help future leaders avoid such mistake. Accordingly, I believe that throughout the twoyears we developed an interesting project portfolio that needs appropriate managementand approach.
  10. 10. 1I. Chapter: Introduction1. IntroductionBackground of the researchSocial enterprises are independent businesses that provide services, goods and trade for asocial purpose and are non-profit distributing (Policy Action Team 3, 1999). In socialenterprises profits are used to create more jobs and businesses and to generate wealth forthe benefit of the community (Community Business Scotland, 1991). Therefore, the role ofthe social enterprises is growing and it has been pursued by governmental andentrepreneurial agencies, to boost the trade within the businesses (Ridley-Duff, 2007). Thefollowing graph represents the forces influencing the social enterprises.
  11. 11. 2Graph 1. Different positions and roles of social enterprises (Ridley-Duff, 2007)From the graph above the observation can be drawn that social enterprises are key elementof strategy of businesses, government and associations. Also they help society, communitiesand families develop. This is achieved through the services and goods they provide, butmainly the projects which they work on. Those are funded by those organizations as part oftheir Corporate Social Responsibility strategy or as a result of negotiations with Councils,who ask for help in the area.
  12. 12. 3Significance and importance of the researchAccording to Cabinet Office (2008) there are at least 55,000 social enterprises operating inthe United Kingdom. And the UK government prepared the Social Enterprise action plan,which aims to increase a number of them and provide help, advice and support for thosewho want to start this type of business. BusinessLink.gov.uk has been set up as apartnership of the government and businesses to provided that to everyone who thinksabout starting their own business (BusinessLink.gov.uk, 2009).On the other hand, the businesses and associations also provide support for socialenterprises as well as funding for the projects in the given area of interest of givencompanies. For example Setas (Social Enterprise Training and Support, 2009) listed just 20sources of funding from various associations and companies for start ups and communityprojects.Many social enterprises focus on winning grants to carry out the projects that make changein the local community and individual lives. Those are funded by various bodies who want tohelp achieve that aim. However, established social enterprises do not have to apply forgrants and finances. They are being approached by organizations who ask for help to carryout given projects.Therefore, they face the problem of having many project applications, which cannot becompleted due to limited resources. There is a need for prioritizing and categorizing projectsin order to accept them into project portfolio of given organization. Many projectapplications are unclear and the benefits are not visible from the beginning, making itharder to asses. Accordingly, the social enterprises struggle to choose the appropriateprojects to carry out, which will benefit them and community they serve.
  13. 13. 4Aim of the researchTo solve this problem the Multi-Criteria Decision Analysis (MCDA) needs to be implemented.The aim of MCDA methods is to support decision-makers with indentifying problems,system values, objectives they have and other parties involved. This is made throughexploration of above in the context of problem to guide them in identifying a preferredcourse of action (K.M. Al-S. Al-Harbi, 2000). In this case, allowing them to choose the mostsuitable and achievable project. This means that resources available will allow to completethe project successfully, and that will be within the aim and mission of the organization. Oneof the MCDA methods is Analytical Hierarchy Process (AHP) method, which will beintroduced in methodology chapter.The implementation of the AHP method will be studied on the case of social enterprisecalled SIFE (Students in Free Enterprise) Salford. This is a student organization which hasvery ambitious mission statement: To create sustainable value by successfully empoweringand educating the local community and students with the necessary financial endentrepreneurial skills needed to improve their standard of living and inspire them to take onreal life opportunities (sifesalford.org, 2009). The organization is working currently on fiveprojects and receives many applications from local associations; community centres andgroups to help on the projects. Due to lack of tools that help with making choice whichprojects should be done and will benefit the organization and community, the SIFE Salfordtakes projects randomly and denies those that could be more beneficial (SIFE SalfordPresident, 2009).Therefore, a system and method for prioritizing and choosing the project into projectsportfolio needs to be implemented.The research needs to be undertaken to find out the most important and crucial criteriaused in assessing the projects. This will be made by surveying the experts in the field of
  14. 14. 5project management and social enterprises. Further, they will participate in interviews toassess three example projects based on the created project description according to five topcriteria (derived in the survey) whether they should be accepted to the project portfolio.This will explain the procedures and process the SIFE Salford need to undertake in the futurewhen creating its portfolio. The Experts will use the AHP method implemented andadministrated through use of Expert Choice software to assess the example projects.The issue is whether the introduction of Multi-Decision Criteria system will benefit theorganization and ease the process making it more efficient. At the same time, allowingmembers to work on the projects that are relevant to the organization objectives. On theother hand, experts will be able to choose within the projects by looking only at thedescriptions provided by submitting organization. Those two methods will be assessed byexperts who will make their judgments during interviews.Issues and problems will be researched in the light of relevant literature. Further the fieldresearch will be performed in order to find the most suitable solution for the studied socialenterprise.2. Research objectives The analysis of the projects criteria to outline the most important and adequate forthe process of selection into project portfolio Analysis of the prioritization and selection methods of projects in project portfoliomanagement Research the usefulness and appropriateness of the analysed methods in selectingand prioritizing projects in project portfolio management
  15. 15. 6 Implementation of the Multi-Criteria Decision method – Analytical HierarchyProcess (AHP) in social enterprise, on the case of SIFE Salford for a project portfoliomanagement
  16. 16. 7II. Chapter: Literature reviewThe main area of study concerns Project Portfolio Management (PPM) and the literaturereview will be performed to outline the main concepts in this area.1. ProjectFirstly, the understanding of the project is very important. Wysocki (2003) defines: A projectis a sequence of unique, complex, and connected activities having one goal or purpose thatmust be completed by a specific time, within budget, and according to specification. On theother hand the Project Management Institute states (PMBOK, 2004) that a project is atemporary endeavour undertaken to create a unique product, service, or result. Whileaccording to PRINCE2 (2002) project is a management environment that is created for thepurpose of delivering one or more business products according to a specified Business Case.Those main definitions presented by leading organizations in project management agreethat project should have a purpose and is limited by time, budget, resources andspecifications.2. Project PortfolioConsequently, the project portfolio can be defined. Before that, it is important to clarifywhat kind of projects should be taken into consideration when creating the projectportfolio. Wysocki (2003) deliberates whether simple task to one person could be a complexproject for others. For example buying the laptop, for those who does not have computerknowledge it will be difficult task and becomes a project. Therefore, it is important thatorganization distinguish operational tasks from projects (McGary, 2003). Once that is set,the simple definition can be introduced stating that a project portfolio is a collection ofprojects that share some common link to one another. The statement of common link meansfor example that all the projects aim to help local community develop or aim to develop
  17. 17. 8new product. On the other hand, Miguel (2008) findings about project portfolio state thatthe concept evaluated from project selection (Baker, 1974) to prioritization of productdevelopment (Cooper et al., 2000) and to the current understanding as multiple projectmanagement (Dooley et al. 2005). Additionally Cooper (1997) argues that in projectportfolio the new project can be introduced, while existing can be withdrawn, cancelled orsuspended. This statement shows that project portfolio is not set for a given period of time,but changes constantly, adjusting to the current situation and objectives of the company,representing great flexibility if properly managed.2.1.Project Portfolio ManagementThis statement leads to another concept, which is project portfolio management. Accordingto Bridges (2003) there is an art of project portfolio management (PPM), which involvesscrutinizing each potential project, selecting the right mix of projects, and adjusting as timepasses and circumstances unfold. Additionally Cooper (1997) argues that portfoliomanagement is a process in which projects for the development of products or services arecontinually evaluated, selected and prioritized; new projects may be introduced and existingprojects might be suspended, cancelled, or de-prioritized. Hunt (2008) adds that projectportfolio management is a decision process that oversees the resource allocation andongoing decisions related to a strategically oriented portfolio of projects. In overall, the mostdefinition that collects the best parts of mentioned definitions and thoughts on projectportfolio has been developed by Wysocki and McGary (2003) and states that Projectportfolio management includes establishing the investment strategy of the portfolio,determining what types of projects can be incorporated in the portfolio, evaluating andprioritizing proposed projects, constructing a balanced portfolio that will achieve theinvestment objectives, monitoring the performance of the portfolio, and adjusting thecontents of the portfolio in order to achieve the desired results. Consequently, when
  18. 18. 9speaking about project portfolio in further stages of this study the reference to this finaldefinition will be made.The decisions made regarding project portfolio must take into consideration the strategicapproach, as well as operational. This means that project that does not correspond to themission and objectives of the organization should not be included in portfolio. According toMiguel (2008) if the projects do not correspond with the business strategy and capabilities,there is a risk that projects will be delivered with poor quality. On the other hand, theremight be increase of resources to focus on the project that is not consistent with others,resulting in decreasing the quality of remaining projects. Hence, according to Cooper (1997)the project portfolio management should lead to acquisition of only those projects, whichwill maximize the value, balance and strategic position of the company.2.2.Balanced PortfolioCooper (1997) declared that organization should aim to maximize the balance of theprojects within the portfolio, as it will help to manage them effectively. Miguel (2008)agrees stating that balanced portfolio in place should be a strategic objective as it isimportant to have different types of the projects.
  19. 19. 10Graph 2. Bubble diagram of a portfolio of new-product projects (Source: Cooper et al.1997, p.24)The above graph introduced by Cooper (1997) shows projects within the portfolio in anycompany. There are projects that guarantee high rewards with high probability of success,at the same time there are more risky projects. This is the great example of balancedportfolio, where there are certain projects that guarantee success, and those can back upthose more risky.McGary (2003) argues that it is neither an easy task to build the balanced project portfolionor there is a successful approach. Kendall (2003) argues that there must be correct mix ofprojects balancing the supply side of organization with its market side. Such balance ensuresthat company does not have any decline in revenues. Additionally, Bridges (2003) believesthat if portfolio is balanced effectively, this will ensure optimum use of resources andpeople.
  20. 20. 11Consequently, it is important to create the project portfolio that is balanced. Also, theprojects undertaken should follow the strategy and objectives of the organization, exploitingits resources efficiently and effectively.2.3.Operating a Project PortfolioThe project portfolio does not exist when an organization has few projects and managesthem at the same time. There is a procedure, sequence when building project portfolio.McGary (2003) is convincing that there are five phases of project portfolio management.Those include (1) Establishment, (2) Evaluation, (3) Prioritization, (4) Selection, (5)Management. At the same time Bridges (2003) says about three steps (1) Focus, StrategicPlanning (2) Selection, Portfolio Management, (3) Management, Project Management. Thisis illustrated on the following graph.Graph 3. Project Portfolio Management (Source: Bridges, 2003)Rad and Levin (2006) also agree that PPM goes through stages of development, whichaccording to them are as follows: (1) identification of enterprise opportunities, (2) selectionof projects to fulfil those opportunities, (3) planning and executing those projects, (4)continually assessing the benefits of these projects to the organizational success.
  21. 21. 12The most detailed approach regarding development of project portfolio has been evaluatedby Wysocki and McGary (2003). Therefore, their five phases will be evaluated in more detail,compromising opinions of other authors regarding relevant steps.2.3.1. Establishing Portfolio StrategyAccording to Wysocki (2003) the first step of building project portfolio is establishing itsstrategy. Bridges (2003) adds that it is essential the portfolio’s strategy is aligned with theorganization mission and objectives. On the other hand Rad and Levin (2006) thatopportunities for the company should be firstly evaluated, before deciding on the strategy.Wysocki (2003) agrees with those statements, stating that project proposals are investmentopportunities that should be evaluated and categorized before they are acquired intoportfolio. According to McGary (2003) there are several models that can be adapted to helpmanagers in this task, which include: Strategic Alignment Model Boston Consulting Group Products/Services Matrix Project Distribution Matrix Growth versus Survival Model Project Investment Categories2.3.2. Evaluating Project Alignment to the Portfolio StrategyThis stage, according to Wysocki (2003) should focus on defining whether the proposedproject is in the alignment of portfolio strategy and to which category it belongs. This ismade through one of the models chosen from the list from previous section. Rajagopal(2007) argues that the company should fund only those projects, which mostly align withcompany’s strategic objectives. Blichfeldt (2007) adds that the projects should be screened
  22. 22. 13against created criteria and classified appropriately. Once the projects are categorized thenext phase can begin (McGary, 2003).2.3.3. Prioritizing and selecting ProjectsWysocki (2003) states that the first tactical step in every portfolio management modelinvolves prioritizing the projects that have been shown to be aligned with the portfoliostrategy. Rajagopal (2007) follows with statement that business attaches valuation criteriato rank projects in terms of their importance. There are many approaches to prioritizeprojects in their categories. Bridges (2003) gives examples of criteria that can be identified:benefits to the company, costs and risks. On the other hand Wysocki and McGary (2003)introduce models that can help to prioritize and select projects in portfolio in the simpleway, those include: Forced Ranking Q-Sort Must-Haves, Should-Haves, Nice-to-Haves Criteria Weighting Paired Comparisons Risk/Benefit Multi-Criteria Decision MethodsThe selection method and process will be described in the 3rdsection of this chapterin greater detail as this part is the highest interest of the research.
  23. 23. 142.3.4. Selecting Balanced Portfolio Using the PrioritizedProjectsThe next phase aims to create a balanced portfolio of projects. According to Wysocki (2003)it is very challenging task for the management team as it involves ranking projects frommost valuable to least valuable. Additionally, it requires choosing those that fit the strategyand can be performed accordingly to available resources. This stage of building the projectportfolio is the most crucial, as projects acquired will be run by the organization utilizing itsresources throughout the planned period of time.Wysocki (2003) examined about 30 different methods that could be used in selection of theprojects into portfolio. The main three outlined by him include: Strategic Alignment Model and Weighted Criteria Project Distribution Matrix and Forced Ranking Graham-Englund Selection Model with the Project Investment Categoriesand the Risk/Benefit MatrixHowever, Bridges (2003) argues that the company should prepare the list of criteria, whichshould be given importance, and then projects should be compared in pairs against them.The most common method for this kind of project selection is Analytical Hierarchy Process(AHP) method. Which will be a main method used in the research and evaluation. Therefore,the detailed analysis and explanation will be performed.2.3.5. Managing the Active ProjectsFinal phase of portfolio management is actual management of the projects that wereaccepted. Wysocki (2003) states that in this phase, each project should be monitored tocheck its performance against the plans outlined. Rajagopal (2007) adds that the portfolioshould be constantly reviewed, some businesses introduce centralized Programme
  24. 24. 15Management Office (PMO) which gathers financial and work progress perspective updatesfrom project leaders. This information and reports are passed to senior staff andstakeholders.2.3.6. Summary of project portfolio developmentAccording to Bridges (2003) an organization may have the best ideas and methods, but if theprocess is not structured or implemented correctly, the company will have a hard timegaining widespread acceptance of the new process. Therefore, it has to be implemented tofit other processes and culture of the company. Accordingly, the introduction of process ofproject portfolio may differ from company to company, and it’s up to management team tochoose the most suitable option.2.4.Project life cycleIn the previous section the path of project has to go through to be accepted into the projectportfolio. It is time to have a closer look on the project life cycle on its own and then in theportfolio itself.PRINE2 (2002) states that a project has a life cycle, which is the path and sequence throughthe various activities which produce the final product (Graph below).Graph 4. Project Life Cycle (Source: PRINCE2, 2002)
  25. 25. 16On the other hand, PMBOK (2004) states that the project life cycle defines the phases thatconnect the beginning of a project to its end (Graph below).Graph 5. Project Life Cycle (Source: PMBOK, 2004)At the same time Gray (2002) shows expanded model of the project life cycle withexplanations what happens in each of the stages defined (Graph below).Graph 6. Project Life Cycle (Source: Gray, 2002)
  26. 26. 17In overall, those models present that project that is going through various stages. In each ofthem there are different tasks performed leading to increase activity of project members.All this models show that the project has defined starting and ending point (Gray, 2002).However, according to Wysocki (2003) the project in portfolio has its own life cycle, which isillustrated on the graph below.Graph 7. Portfolio project life cycleAccording to this model there are eight stages the projects go through in the process ofcreating the project portfolio development which have got to be completed in order tocreate the successful portfolio.2.5.Benefits of project portfolioThere are many benefits when the organization decided to introduce project portfoliomanagement. Bridges (2003) states that benefits are tremendous, for example the value ofSmithKleineBeecham portfolio increased by 30 percent after introduction of presentedapproach. These benefits presented by Bridges (2003), Rajagopal (2007), Rad (2006) include:
  27. 27. 18 Having a structure in place to select the right projects and immediately remove thewrong projects; Placing resources where theyre needed and reducing wasteful spending, betterutilization of resources Linking portfolio decisions to strategic direction and business goals; tighteralignment with organizational objectives Establishing logic, reasoning, and a sense of fairness to portfolio decisions; Establishing ownership among the staff by involvement at the right levels; Providing avenues for individuals to identify opportunities and obtain support; Helping project teams understand the value of their contributions.2.6.ProblemsAlthough there are many benefits of having a project portfolio management in theorganization, there are problems that might occur. Those problems are challenges forportfolio managers and include, according to Kendall (2003): Too many active projects (often double what an organization should have) Wrong projects (projects that will not provide value to the organization) Projects not linked to strategic goals Unbalanced portfolio [e.g. Too much on the supply side, not enough on the marketside; or Too much short term and not enough long term, etc.]Accordingly, the research will focus on finding the best practices to avoid those problemswhen implementing project portfolio and while managing it.
  28. 28. 193. Project Selection methodsAs revealed by the President of SIFE Salford (studied organization) there is no structuredselection method of the projects which are undertaken by the organization. All the decisionsare made by the management committee based on the little information from externalorganization and without specific evaluation. It is made through democratic voting withoutjustification of decisions.This dissertation through the research undertaken aims to present available methodscommonly used in various industries for selecting methods. Further the assessment of themethods and analysis by experts will reveal which of the chosen one is more accurate andsuitable for studied organization.Two methods have been selected for the comparison and study. First one is called CriteriaWeighting (Wysocki, 2003; Heldman 2007), while second is Analytical Hierarchy Process(Saaty, 2001). These will be now described and analysed along their application.Importance of selection methodsAccording to Marzouk (2008) there is a need for structured selection of the project as ithelps to avoid common problems that occur with projects such as cost and scheduleoverruns, reducing quality and safety measures, claims and litigation. Further, thecapabilities of the partners need to be examined and various criteria need to be evaluated(Hatush and Skitmore, 1998). According to those authors common mistake is choosing aproject with biggest budget, which is just one criterion, while there should be other takeninto consideration as decisions are complex. Even though, Mahdi (2002, p.29) argues thatthe selection method should be simple, normally accurate and transparent so that thereason why the project have been chosen is clear and reasonable. Rad (2006) states that toachieve successful project portfolio management the methodical selection of projectsapproach needs to be implemented (Graph below).
  29. 29. 20Graph 8. Process of managing portfolios successfully (Rad, 2006, p.127)Difficulty of selecting a projectGraves (2002) outlines that manager or organization has a great difficulty in selecting aproject from a menu of opportunities. Their choice is limited by available resources, forexample capital, talent, time. Further, Graves (2002, p.1) adds that the choice has got to bealigned with the strategy to satisfy corporate goals or objectives. Often these are multiplemaking it even harder to decide without applied, structured approach for selection. Further,Levine (2005) states that managers often know only few aspects of the projects ororganization strategy, and make their decision based only on that without taking intoconsideration other criteria. Also, the situation in the organization is complex andavailability of resources varies which also commonly is not taken into consideration (Levine,2005). This illustrates that without appropriate process of selecting a project to the projectportfolio the inappropriate project can be selected, which could lead to great difficulties.The approach has got to be systematic and allow clear, transparent choice.3.1. Criteria weighting methodWysocki (2003) introduces the criteria weighting method as the one that can be used forprioritizing and selecting projects into project portfolio. Following, he states that there aremany models built by various authors, which apply the same scheme and approach.
  30. 30. 21Heldman (2007) outlines that a criteria weighting method lays within scoring modelssection. Furthermore, these methods and models belong to category defined by ProjectManagement Institute (PMI) defined as benefit measurement. According to Heldman (2007)methods in this category apply various forms of analysis and comparative approaches tomake project decisions. The other category outlined by PMI is mathematical methods, whichcontains very complicated algorithms and formulas, which can be applied for very complexprojects.Therefore, for simple project selection in the social enterprise the scoring model or criteriaweighting method can be applied more easily. Rad (2006, p.32) states that appropriatelyapplied scoring model consists of four components: Categories of criteria to determine the model type Range of values for the criteria Measurement and description for each value within the range Importance or weight of the criteriaFirstly, Heldman (2007) advises that commonly the project committee decides on thecriteria that will be taken into consideration and scored against. For the analysis of the casestudy the survey will be performed to outline the most important criteria in social enterprise(Methodology Chapter). Rad (2006) argues that selected criteria should be objective, thatpeople cannot skew the model to select pet projects (Armstrong, 2004).There is a wide range of available criteria that can be taken into consideration whenselecting projects. Cooper (2001) outlines criteria such as strategic attractiveness,product/competitive advantage, market attractiveness, synergies in terms of leveraging corecompetences, technical feasibility and risk versus return. Martino (2003) adds costs, payoff,market share, probability of success, the availability of resources, degree of competition,
  31. 31. 22constraints. Cleland (2003) focuses on criteria such as risk, profit margin and duration. Forthe purpose of the research the criteria have been chosen to fit the case of social enterprise(Methodology chapter).In the next step of the method, according to Wysocki (2003) experts should agree on theweight of each criterion scoring them from 1 – 10 or 1 – 5. Heldman (2007) follows statingthat highest score represent higher importance than lower scored criteria. According to Rad(2006) such assessment will show which criteria can be scored objectively and which willrequire some more judgments to be made. Martino (2003, p.32) argues that if one or morecriteria are compromised of sub-criteria that are combined to obtain the value for a factor,any combination must be done outside of the specific model.Once the criteria are weighted, the experts can score a project against agreed criteria usingthe same scale an approach as step before.An example of such scoring is presented in the table below.Criteria Weight ProjectA ScoreProjectA TotalsProjectB ScoreProjectB TotalsProjectC ScoreProjectC TotalsProfit potential 5 5 25 5 25 3 15Marketability 3 4 12 3 9 4 12Ease toproduce/support1 4 4 3 3 2 2Weighted score 41 37 29Table 1. Scoring method (own study based on Heldman, 2007, p.64)In the example from Heldman (2007) it can be seen that project A is an obvious score due tohighest score.
  32. 32. 23According to Cooper (2001) thescores given by projects become a proxy for the value of theproject. However, it includes strategic, leverage, and other considerations rather than solelyfinancial measures (Rad, 2006, p.33). Consequently, Meredith (2006) suggests use of scoringmodels as they include multiple objectives and criteria, which is crucial in decision makingprocess. However, Meredith (2006) would add constraints to the model to reflect the realsituation of the project.In summary, the criteria weighting method is commonly used by many researchers andauthors. Models have different variances according to the specific case or application.Nevertheless, they are based on the same decision process, which is widely applied in theindustry.LimitationsRad (2006, p.33) states that although scoring models are easy to use, they are not precise.Therefore, the results should be only treated as guidelines bearing in mind that peopleshould make decisions not models. Meredith (2006) adds that experts are forced to makedifficult decisions based on limited information and analysis. Further, the U.S. GovernmentOffice (GAO) argues about the importance of defining the scoring elements. Each scoreshould have description of what it actually represents. Experts often face only numbers onthe scale without understanding of the meaning, such exercise are meaningless. Therefore,the correct approach should be implemented allowing experts to understand purpose andmeaning of the method. Warrall (2000) states that there might occur difficulties withexpressing the judgments based only on numerical scale or if decisions and scoring aremade during discussion. In such situation the experts might be afraid to express their actualjudgments due to certain circumstances (i.e. presence of senior management). Therefore, itis important to build functional atmosphere for applying the method.
  33. 33. 243.2.Analytical Hierarchy Process methodMulti-criteria decision makingAccording to Al-Harbi (1999, p.19) project, portfolio and organization managers are facedwith complex decisions in intricate environments. The elements of the problems arenumerous, and the inter-relationships among the elements are extremely complicated. Thedecisions need to be made, taking into consideration all the factors, influences andconstraints. Schuyler (1999) argues that many managers are lacking skills that allow sounddecisions, therefore there is a need to implement the decision making approach.Triantaphyllou (2000) states that the way people make decisions (prescriptive theories) orthe way people ought to make decisions (normative theories) has been a subject to manyresearch papers for years. Consequently, many methods and theories have been developedover years. One of the major branches in decision making is Multi-Criteria Decision Making(MCDM). According to Triantaphyllou (2000, p.1) MCDM concentrate on problems withdiscrete decision spaces, which means that the set of decisions alternatives has beenpredetermined. Although, there are many MCDM methods, they have certain aspects incommon which are explained below: Alternatives – different choices of action available to decision maker, which shouldbe screened, prioritized or/and ranked Multiple attributes – attributes represent the different dimensions from whichalternatives can be viewed. In complex projects or decisions, the attributes andcriteria can be structured in hierarchical manner, showing the importance, valueagainst each other. Conflict among criteria - i.e. profit and cost Incommensurable units – when criteria are expressed by different units ofmeasurement but still have to be compared
  34. 34. 25 Decision Weights – the criteria are given weights representing their importance Decision Matrix – each problem analysed by MCDM can be illustrated on the matrixshowing criteria, weights and alternativesAccording to Al-Harbi (1999) and other authors, the aim of MCDM methods is to helpdecision-makers learn about the problems they face, to learn about their own and otherparties personal value systems, to learn about organizational values and objectives, andthrough exploring these in the context of the problem to guide them in identifying apreferred course of action. According to Hwang and Yoon (1981) research on MCDMmethods, which have application in project management revealed that they are mostly usedfor evaluation of problems and design of problems. Therefore, the analyzed case study inthis dissertation has a problem of choosing the appropriate selection method for thestudied social enterprise.ApplicationAmong number of MCDM methods available the Analytic Hierarchy Process (AHP) methodhas been chosen by the author. According to Al-Harbi (1999), Harker and Vargas (1987),Perez (1995) the method is viable and widely used by governmental agencies, corporationsand consulting firms. Moreover, there are a lot of applications for this method acrossindustries showing that method is popular and works, efficiently allowing making sounddecisions. Below there is a list of authors who used AHP method for their own researchstudies and cases, which show a great variety of applications.Authors (Year of publication) Application of AHP methodWu, W., Lee, Y. (2007) Selecting knowledge management strategiesMahdi, I.M., Riley, M. J., Fereif, S.M., Alex,P.A. (2002)Contractor selection
  35. 35. 26Marzouk, M. (2008) Contractor selectionHatush, Z. and Skitmore, M. (1998) Contractor selectionMota, C. M. M., Almeida, A. T., Alencar, L. H.(2009)Assigning priorities to activities in projectmanagementMilis, K., Mercken, R. (2004) The evaluation of Information andCommunication Technology projectsLin, M., Wang, C., Chen, M., Chang, C. A.(2008)Customer-driven product design processLee, A. H. I., Chen, W., Chang, C. (2008) Evaluation of performance of IT departmentin the manufacturing industry in TaiwanHuang, Y., Bian, L. (2009) Personalized recommendations for touristattractions over InternetErtugrul, I., Karakasoglu, N. (2009) Performance evaluation of Turkish cementfirmsChin, K., Xu, D., Yang, J., Lam, J.P. (2008) Product project screeningCheng, S., Chen, M., Chang, H., Chou, T.(2007)Semantic-based facial expression recognitionCelik, M., Er, I. D., Ozok, A. F. (2009) Shipping registry selection: The case ofTurkish maritime industryCarlucci, D., Schiuma, G. (2007) Knowledge assets value creation map,Assessing knowledge assets value driversThe above table shows that the AHP method is widely used in various industries, thereforethe author decided to illustrate application of it to the studied social enterprise.
  36. 36. 27The Analytic Hierarchy ProcessThe method s has been developed by Saaty (1980; 1994; 2001), therefore it is essential tounderstand the process of the author. Consequently, there are three principles of analyticthought that underlie the AHP which are: constructing hierarchies, establishing prioritiesand logical consistency.Structuring (Construction) hierarchies. Saaty (2001) states that human mind structurescomplex reality into parts, which consist of parts and so on building a hierarchy. Breaking aproblem or a case down to detailed structures allows getting a more complete picture. Insome cases it can have up to nine levels if the problem is complex or decision veryimportant.Setting priorities. According to Saaty (2001, p.17) humans have the ability to perceiverelationships among the things they observe, to compare pairs of similar things againstcertain criteria and to discriminate between both members of a pair by judging the intensityof their preference for one over the other. Consequently, Saaty (2001) argues that judgmentscan be synthesized through imagination or with AHP, the new logical process, which allowsgaining understanding of the whole system.Logical consistency. Final principle of AHP method comes from Saaty’s research (2001)revealing that humans the ability to establish relationships among objects or ideas in such away that they are coherent. This means that judgments relate to each other exhibitingconsistency, which means two things. Firstly, the ideas or objects are grouped according tohomogeneity and relevance. Secondly, the intensities of relations among ideas or objectsbased on a particular criterion justify each other in some logical way.
  37. 37. 28Principles in AHP ProcessSaaty’s AHP method (2001) utilizes these principles in AHP process incorporating both thequalitative and the quantitative aspects of human thought: the qualitative to define theproblem and it hierarchy and the quantitative to express judgements and preferencesconcisely. The AHP process integrates those two approaches which allow making sounddecisions.AHP StepsAl-Harbi (1999) summarized steps of Saaty’s AHP method:
  38. 38. 29The Analytic Hierarchy Process is a complicated mathematical method, which helps a lotwith decision making. However, if there was no software that allows user-friendlyapplication of it, very few people would use it. The Expert Choice software has beendesigned, which hides the complicated mathematical calculations and algorithms underuser-friendly screens which allow fast decision making and analysis of the results(ExpertChoice.Com, 2009). The process will be explained in detail in methodology chapter.
  39. 39. 30Advantages of AHPGraph 9. Advantages of the Analytic Hierarchy Process (own study based on Saaty, 2001, p.25)AHPUnity: The AHP provides a single,easily understood, flexible modelfor a wide range of unstructuredproblemsComplexity: The AHPintegrates deductiveand systems approachesin solving complexproblemsInterdependence: TheAHP can deal with theinterdependence ofelements in a systemand does not insist onlinear thinkingMeasurement: The AHPprovides a scale formeasuring intangiblesand a method forestablishing prioritiesConsistency: The AHPtracks the logicalconsistency ofjudgments used indetermining prioritiesSynthesis: The AHPleads to an overallestimate of thedesirability of eachalternativeTradeoffs: The AHP takesinto consideration therelative priorities of factorsin a system and enablespeople to select the bestalternative based on theirgoalsJudgment and consensus:The AHP does nor insist onconsensus but synthesizes arepresentative outcomefrom diverse judgementProcess Repetition: The AHPenables people to refinetheir definition of a problemand to improve theirjudgment and understandingthrough repetition
  40. 40. 31Other authors also recognize other advantages of AHP method. Al-Harbi (199) states that AHP allowsconsideration of multi-criteria as well as group decision-making. Also, other authors who foundapplication of AHP very useful (table above) appraise the use of software for this method.Critique of AHPAlthough the AHP method has many applications in various industries and is widely used there arestill some critiques of it. Watson and Freeling (1987) argued that in order to elicit the weights of thecriteria by means of a ratio scale, the method asks decision-makers meaningless questions, forexample: `Which of these two criteria is more important for the goal? By how much? According toauthors it is not constructive. Moreover, Belton and Gear (1983) and Dyer (1999) pointed out thatthis method can suffer from rank reversal (an alternative chosen as the best over a set of X, is notchosen when some alternative, perhaps an unimportant one, is excluded from X). Further, Cheng etal. (2007) stated that AHP is rigid and inflexible making it hard to use in fast moving projects.Further, Barzilai (1998) examined the AHP method and concluded through various case studies thatshows that application of AHP leads to wrong results.These criticisms have been tackled by various authors, who analysed the problems and presentedanswers. The most accurate response had been presented by Whitaker (2007) who examined thecases brought up by mentioned authors. From her research it came obvious that critiques have notapplied AHP method appropriately and missed fundamental steps in AHP process such asestablishing priorities for criteria. Consequently, Whitaker (2007) defended the AHP method byrevealing wrong approaches taken by the critiques.Ethical ConsiderationsSaaty (2001, p.11) argues that because of complexity of decision making process, the expertresponsible for judgments regarding social issues should have following characteristics to be able tomake ethical decisions:
  41. 41. 32 Truthfulness by not oversimplifying complexity Justice by evaluating costs and benefits and assigning costs to those who get the benefits Ability to plan for the unknown by calculating changes, determining where they are likely tooccur, and deciding which priorities should dictate action Flexibility in adapting to change by planning, implementing, and, in response to newconditions, re-planning and re-implementing.Summary of AHPAccording to Forman (2001, p.43) the AHP developed at the Wharton School of Business by ThomasSaaty, allows decision makers to model a complex problem in a hierarchical structure showing therelationships of the goal, objectives (criteria), sub-objectives and alternatives. Bhuschan (2004)outlines important aspect of AHP, which allows group decisions through brainstorming, meetings oropen discussions. The Expert Choice software based on the methods allows assessments byindividual experts which then can be combined to produce overall result. The AHP has found manyapplications, because it makes experts compare criteria and alternatives in pairs, which allows themto oversee the problem and understand the structure and reasoning of the studied situation.
  42. 42. 33III. Chapter: MethodologyAs an academic activity, the research should be conducted in a systematic, organised and plannedmanner (Kothari, 2005). Therefore, this chapter introduces the methodology of the author’s researchand aims to present its methods and procedures.Firstly the reasoning of the research will be discussed. According to Crotty (1999) every researchconsists of four elements as shown on the graph below.Graph 10. Four elements of research (Crotty, 1998, p.4)Each of these elements has been described by Crotty (1998, p.2): Epistemology: the theory of knowledge embedded in the theoretical perspective andthereby in the methodology Theoretical perspective: the philosophical stance informing the methodology and thusproviding a context for the process and grounding its logic criteria Methodology: the strategy, plan of action, process or design lying behing the choice and useof particulat methods and linking the choice and use of methods to the desired outcomes
  43. 43. 34 Methods: the techniques or procedures used to gather and analyse data related to someresearch question or hypothesisKumar (2005) states that research is the way of thinking, critically examining the various options andaspects of world from perspective of i.e. customer, professional, institutions or businesses.Accordingly, the research is one of the ways to finding answer to the questions (Kumar, 2005, p.6).Kumar (2005, p.6) argues that the researcher philosophical orientation may steem from one of theseveral paradigms and approaches in research – positivist, interpretive, phenomenolist, action orparticipatory, feminist, qualitative, quantiatative – and the academic disciplin in which researcherhave been trained.Nevertheless, authors (Kumar, 2005, Crotty, 1998, Malhotra, 2007) agree that the research should bevalid, reliable and unbiased. The first concept assures that correct procedures and approaches havebeen chosen and applied in research. Reliability ensures the quality of research methods, datacollection and analysis which will provide accurate results. Finally, unbiased refers to objectiveapproach of researcher who will not introduce personal statements and influences at any of thestage of research and remind unbiased. Kumar (2005) states that fulfilling these three criteria allowsto call the process a research.Types of researchKumar (2005) and other authors identify types of research as presented on the graph below:
  44. 44. 35Graph 11. Types of research (Source: Kumar, 2005, p.9)The three classifications are not mutually exclusive (Kumar, 2005, p.8). Application approach aims toexamine the methods, techniques or procedures that can be further applied in real life situations toimprove existing systems or to introduce new solutions. As it is the aim of this research, whereproject selection methods are studied and researched to be later introduced to the social enterprisefor further implementation.Furthermore, the objective approach aims to describe a situation or problem (descriptive research),to discover relationship/association between two or more aspects of situation (correlation research),to clarify why and how there is a relation between aspects of situation (explanatory research), toexplore the area of study whether it is worth researching (exploratory research) (Kumar, 2005).Finally, inquiry mode approach considers processes which will be undertaken to find answers to thequestions. Accordingly, there are two aspects: the structured and unstructured. First is connectedwith qualitative research, where everything (scope, objectives, structures) are predefined, whichallows to analyse the extent of the problem. On the other hand, unstructured approach is classified
  45. 45. 36as a qualitative research, which allows greater flexibility than quantitative. Therefore it is mostly usedto investigate the nature of the problem (Kumar, 2005).In summary, the research is a complex task that has to have the reason behind to undertake it.Further it has to be examined whether someone before carried out similar research. Then theadvantages of such process should be outlined whether they will be theoretical or practical and whowill benefit from this. Finally, once the research has been approved to be undertaken the researchmethodology and methods has got to be examined and decided for the given case.This leads to analysis of secondary and primary research.1. Secondary researchThe secondary data, gathered in previous researches for some other purposes, has numerous of usesin the author’s research, including: helping to answer the research questions, getting the backgroundand understanding of the overall problem situation (Wrenn, et al, 2006). Two different sources of thesecondary data can be highlighted here: internal and external sources. While the first one can befound within the organization for which the research is provided (social enterprise – SIFE Salford),the external data is more difficult to obtain and has forms, such as online material, databases, etc.(Malhotra, 2007).
  46. 46. 37Graph 12. A classification of secondary data (own study based on Malhotra, 2007, p.100)The collection and analysis of secondary data can help to define research problem and develop anapproach to solve it (Malhotra, 2007). Secondary data can help with diagnosis of the researchproblem, development of an approach to solve it as well as to create sampling plan. Further, it helpswith answering certain questions and testing hypotheses. Finally, it allows to validation of researchfindings, through comparison with results of other authors (Malhotra, 2007, p.96).However, secondary data has some disadvantages. Firstly, data was collected for other purposesthan research undertaken. Therefore, they might be irrelevant or inaccurate for the studied case.Following, the data analysed may not be current or reliable (Malhotra, 2007, p.96). Therefore,Malhotra (2007) advises to evaluate secondary data before discussing it.2. Primary researchAs the search for the research answers may also go beyond the study of the existing secondary data,it is vital for the researcher to address the research problem personally. The primary researchSecondary datainternalReady to useRequires furtherprocessingexternalPublishedmaterialsComputeriseddatabasesSyndicatedservices
  47. 47. 38approach needs to be implemented in such case and it requires the researcher to justify his or herreasons for choosing a particular method of data collecting (Wrenn, et al, 2006).Therefore, after analysing the possible types and methods of conducting the study, the researcherfinds it applicable to utilise the qualitative research. This type is concerned with the qualitativephenomena and aims to explore it. On the other hand, quantitative research typically seeks tomeasure the quantity or a certain amount of the phenomena (Kothari, 2005).As the qualitative research takes place in the natural setting, in order to ensure comfortable situationfor the participants taking part in it (Creswell, 2003), the researcher aims to create such settings, aswell as the use of various interactive methods is planned to be used. The purpose of that is to buildcredibility of the participants and encourage them to actively take part in the research (Creswell,2003).The researcher’s primary aim, while conducting qualitative research, is to understand the underlyingmotivations and processes, as well as objectives of the study (Malhotra and Birks, 2007).Primary research plan and strategyTo address the research objectives and produce the results that can be analysed for furtherrecommendations, the research undertaken needs to have a structure and plan.In the first stage the survey will be commenced to identify key criteria for project selection. Thenresults from the survey, top 5 criteria chosen by surveyed people will be used to form thequestionnaire.In the second stage research participants will be interviewed. They will be asked to choose oneproject that should be implemented by the studied organization. This decision will be made solely bycomparing project description (prepared to the 5 criteria derived from survey). The participants willbe asked to justify their decision and answer supportive questions
  48. 48. 39In the third stage experts will be asked to assess and choose the projects once again, but using ExpertChoice software this time.The results from the research will be further analysed in the next chapter. Below, the detailedpresentation of each method and approach will be discussed.Stage 1: SurveyObjectiveThe first stage of the research addresses the first objective of the dissertation, which asks to outlinethe most important and adequate criteria for the process of project selection into project portfolio.The most suitable research method to achieve this has been the survey due to rapid turnaround ofdata collection and economy of design (Creswell, 2003, p.154).According to Creswell (2003, p.153) a survey provides a quantitative or numeric description of trends,attitudes, or opinions of a population by studying the sample of that population. Fowler (2002, p.2)follows that by stating that research aim is to gain subjective feelings of the public regarding theasked issue.Target audience – SampleCreswell (2006) states any survey has got to have target group which will participate in research.They have to be chosen accordingly to their knowledge and expertise about the researched topic. Forthe purpose of this questionnaire four target groups has been identified, which are as follows:Project Managers, Volunteering & Community Organizations Managers, Management Committee ofSIFE Salford (student society which case is being studied), experienced employees who work onprojects. From each of these groups three people had been asked to fill in the survey, which led tocollecting twelve responses.
  49. 49. 40Design of the surveyThe objective of the survey was to identify the most important criteria for project selection. Tocreate the list of criteria from which the surveyed could choose from, the primary research has beenperformed. Levine (2007), Gray and Larson (2002), Westerveld (2003), Stewart and Mohamed (2002),Visitacion (2006) have identified criteria in their research and those suitable to the case study (socialenterprise) has been chosen.Data collectionPeople surveyed have been asked to chose five criteria from the list and rank them according to theirsignificance from the most to least important. Each of the answer has different value as presented ina table below. This will allow creating a ranking of criteria based on the average score. The top fivecriteria will be chosen for the next stage of research.Significance Valuethe most important 5Second important 4Third important 3Fourth important 2The least important 1Table 2. Explanation of rating answersThe survey has been designed using an online survey tool from SurveyMonkey.com Company. It isfree and very advanced tool for research methods. The designed survey (Appendix 1) has been sentby email to 12 chosen participants (Appendix 1). Further they answered one question by ranking fivecriteria of their choice. The data was collected in the system which helps to analyse it further in thenext chapter.
  50. 50. 41LimitationsSaunders (2007, p.531) states that any research has its limitations such as the size of the sample andthe snapshot nature of the research. Further, criteria identified by authors such as Levine (2007) ledto creating the list; however there might be other criteria which have not been identified.Additionally, Bickman (1997) and Saunders (2007) state that the language and wording of researchquestions and answers has got to be understandable for surveyed people. Because they mayrepresent different industries there is a risk of misunderstanding o use of different definitions.Stage 2: InterviewThe interview can be described as a conversation conducted in a planned and unstructured mannerthat is conducted by the researcher who possesses an underlying purpose (Gillham, 2000). Duringthe research a series of questions from the researcher to the participant (interviewee) is asked withthe aim for the researcher to listen, analyse and then interpret the material gathered from theanswers (Malhotra and Birks, 2007).Conducting an interview is one of the most common methods used in qualitative research, mainlydue to its characteristic of being a flexible, open and direct of collecting the primary data. Throughthe way of unstructured conversation the researcher can also collect more additional, backgroundinformation that will help him or her to understand the ‘broader picture’ of the research problem.Malhotra and Birks (2007) summarize that by saying that “in-depth interviewing seeks ‘deep’information and understanding”.ObjectiveThe aim of the interview is to gain understanding of decision making process, reasons behind it whenselecting project into project portfolio. Additionally, interview aims to research the usefulness andappropriateness of the presented method in opinion of different target groups. The opinionsregarding the method will be gathered for further analysis and comparison.
  51. 51. 42Design of interviewParticipants will be shown the first method of assessing the projects by comparing projectdescriptions (Appendix 2) of three anonymous projects from various organizations. Based on themexperts will be asked to choose one project that should be accepted to the project portfolio.Further, they will be asked to justify their choice and answer additional questions that will supporttheir answer and discussion if necessary (Appendix 3). Because they will be assessing projects to beimplemented by the studied organization - SIFE Salford, the will be given short description about thisparticular social enterprises, its capabilities and general idea behind (Appendix 4).Target audience – SampleThe representatives from four identified groups: Project Managers, Volunteering & CommunityOrganizations Managers, Management Committee of SIFE Salford, experienced employees, whowork on projects, will be asked to participate in one-on-one interviews. The expertise and knowledgeof the interviewed people, along with their different perspectives on the studied issue will revealinteresting results and findings, which will lead to recommendations for studied organization.Data collectionThe researcher will provided project descriptions for the interviewed person with a field forcomments. There will be time provided for analysis of the data presented and then the interview willbe performed with support of the questions prepared to lead the discussion.LimitationsUnderstandably, a number of constraints may occur during the research, with the major one relatedto the time scale of the study that is expected to be planned, designed, conducted and analysed inonly few months only by the researcher himself. Additionally, the researcher, not being aprofessional in the field of research, may experience this as a difficulty. Limitations connected withthe interview method include, i.e.: the lack of sufficient responses, participants’ aversion, anddifficulty of the questions asked.
  52. 52. 43Stage 3: Expert Choice assessmentObjectiveThe aim of this assessment is to show alternative method for selecting the project, which widely usedin the various industries across the globe, the Analytical Hierarchy Process (AHP) method.It has been discussed in the literature review and its applications were outlined. It is very complexmathematical method, therefore to make it more accessible the Expert Choice software has beenused to allow simple on-screen decisions, while the program calculates everything on its own. For thepurpose of the research the Expert Choice 2ndEducation Edition will be used, the Expert Choice Incallows discussion over terms and conditions of use of their software and could allow free use forsocial enterprise.Secondly the experts will be able to assess the method and compare it with the previous oneoutlined in the stage 2 of the research. The aim is to get opinion from the experts about usefulnessand appropriateness of the methods for the social enterprise, and which of the methods can be morebeneficial for the studied organization.Design of the assessmentThe special file in the Expert Choice software has been designed to address the research (AttachedDVD). The objective of the assessment by the experts is to choose one project that should beaccepted to the project portfolio by the SIFE Salford. Experts will be given same project descriptionsas in the stage 2; however they will make decisions and comparisons according to the instructions onthe screen.Overview of the softwareExpert Choice 2ndEducation Edition is a robust, desktop-based application that enables teams toprioritize objectives and evaluate alternatives and achieve alignment, buy-in, and confidence aroundimportant organizational decisions (ExpertChoice.com). Forman (2001) states that introduction of
  53. 53. 44the PC implementation, Expert Choice allowed growth of AHP applications around the world acrossindustries.Wyatt (1999, p.137) analysed Expert Choice software and stated that it focuses on alternativesevaluation. It helps policymakers choose, by converting their comparative ratings for alternativepolicies into ratio scale scores. The strength of the software is the ability to warn experts about theirinconsistency in ratings.Table 3. Categories of problems that have been addressed by Expert Choice (Source: Wyatt, 1999,p.137)The table above shows the categories which can be addressed by studied software. The case of thedissertation research lies within first category regarding the investment and strategies. The studiedsociety needs to select the project to their portfolio that will suit their capabilities and requirements.The software had been designed by Thomas Saaty, a mathematician who worked in the WhartonBusiness School at the University of Pennsylvania and later at the University of Pittsburgh (Wyatt,1999, p.137). He is the author of Analytic Hierarchy Process (AHP) approach, which utilizes complexanalysis of users’ preferences matrices and underpins the Expert Choice package (Forman, 2001 andWyatt, 1999).
  54. 54. 45Expert choice assessment step by stepStep 1: Set up of the assessment fileGraph 13. Expert Choice main screenThe main screen of the Expert Choice gives an overview of all the options available. Firstly, there is aneed to clarify the goal of the assessment.Goal: Selection of the project to the project portfolio for SIFE SalfordFurther, the identification of criteria chosen (which have been derived through the survey):Financial stability (of an external organization)Payback (time needed to recover the investment)Social Return on Investment (Value in Pounds)Risk Analysis (number of risks & their probability/impact)Budget (the size of the total project budget)Step 2: Criteria assessmentExperts will be asked to compare criteria in pairs and choose the importance of the criteria to them.
  55. 55. 46Graph 14. Expert Choice criteria analysisThe assessment of those criteria will give them a rate that will be used further by the software tocalculate next decisions.Step 3: Projects assessmentThe final step undertaken by the expert is assessment of the projects regarding each of the fivecriteria, one by one. Projects are compared in pairs regarding each of the criteria by turns.Graph 15. Expert Choice project assessment screenUsing softwareBasically, the interface of the software is user friendly. The expert can make decision in three ways.
  56. 56. 47First option is on the scale from 1 to 9, where 1 shows that criteria or options are equal and highermarks illustrate advantages.Graph 16. Expert Choice decision screen 1Second option allows expert to choose options expressed in words: Equal, Moderate, Strong, VeryStrong, and Extreme.Graph 17. Expert Choice decision screen 2Third option is very graphical, where expert can decide advantage of criteria or option through theillustration by clicking on red or blue strip, which will result in changing colours on the right hand sidecircle.
  57. 57. 48Graph 18. Expert Choice decision screen 3The expert may choose which method of assessment is more suitable for him or her. It does notaffect the final score as the software calculates the graphic illustrations and words expressions tonumbers and uses complicated mathematical algorithms to produce final score.Step 4: Analysis of the resultsOnce all the experts make the assessment the software calculates the ratings and scores into resultswhich can be analysed through various graphs and options, which will be presented in findingschapter.Target audience – SampleThe representatives from four identified groups: Project Managers, Volunteering & CommunityOrganizations Managers, Management Committee of SIFE Salford, experienced employees, whowork on projects, will be asked to participate in Expert Choice assessment. They will be assisted bythe researcher, who will explain how to operate the software and what applications it has. Thepeople who take part in this stage of the assessment will be the same who have been interviewed;therefore they will be able to leave their comments regarding the comparison of the selectionmethods they got familiar with.
  58. 58. 49Data collectionExperts will be shown how the software works and then on the computer with the licensed softwarewill assess the projects. Their decisions will be recorded in the software in the specially designed file.Further their opinions and comments will be recorded by the researcher on dedicated sheet.LimitationsForman (2001) outlines the limitations of the Analytical Hierarchy Process and use of Expert Choicesoftware. First of them is that humans make relative rather than absolute judgements. Secondly, thejudgments are not very accurate whether the expert will use 1-9 scoring scale or worded scale.Thirdly, experts can be inconsistent in their judgments. However, expert choice reveals theinconsistency ratio for each expert and set of judgments. The reasons for inconsistency can bevarious from lack of information, concentration to inadequate model structure. Nevertheless,Forman (2001) argues that it is more important to be accurate than consistent, mainly because thereal world is not consistent and this will appear in expert judgements.3. Ethical issuesThyer (2001) outlines that in any research there are ethical issues, which needs to be taken intoconsideration. Levine (Reamer, 2001) states that research participation should be voluntary andinformed. Also the data gathered should be protected and published fully to avoid any forgery. Thyer(2001) adds that at the initial stages, when questions are being prepared the must be constructed inthe manner that does not offend anyone.The ethical issues will be taken into consideration by researched when constructing the questionsand further analysis of data gathered. The researcher is ethically obliged to ensure the relevance andusefulness of secondary data to the problem at hand (Malhotra, 2007, p.117).
  59. 59. 50SummaryThe research aims to address the objectives and gather data that will allow further analysis, whichwill result in recommendations for the organization. The secondary and primary research will beundertaken to find the best solution and approach.
  60. 60. 51IV. Chapter: Research Findings and ResultsThis chapter focuses on the analysis of the results and findings from research undertaken. The aim toillustrate different opinions of the experts regarding research topic and objectives and then toanalyse them, which will allow further discussion in next chapter.1. Survey ResultsTwelve experts representing four target groups responded to online survey. The aim was to identifythe most significant criteria when selecting projects into project portfolio. Detailed informationabout responses of the survey is outlined below.
  61. 61. 52Graph 19. Detailed survey analysisAfter gathering and analysis of the results the ranking of the criteria chosen by the 12 expertsparticipating in research have been created:
  62. 62. 53Position Criteria Rating Average1 Financial stability (of an external organization) 4.502 Payback (time needed to recover the investment) 4.253 Social Return on Investment (Value in £) 4.204Risks Analysis (Number of risks and theirprobability/impact) 4.005 Budget (The size of the total project budget) 3.756 Volunteers (number required) 3.677 Profit (generated for the organization) 3.208 Sustainability of the impact 3.009 Impact (the number of people impacted and scope) 2.8810 Feasibility of implementation 2.7511 Learning benefits (for the organization and volunteers) 2.5012 Time (Duration of the project and hours required) 2.2013 Cost (obtained by the organization) 2.0014 Security of the project 2.0015Training and Support (Available to volunteers fromexternal organization) 1.5016 Prospect to hand down the project 1.0017 Partners (Number of partners involved) 0.0018 Net Present Value (NPV) 0.00Table 4. Ranking of the criteriaTop five criteria from the ranking were chosen to create project descriptions (Appendix 2) whichwere used for the second stage of the assessment and research.
  63. 63. 542. Interview resultsThe interviews had been performed as an open discussion welcoming comments regarding everyaspect of presented methods and assessments. However, the interview was guided by the four mainquestions and issues presented in detail in Appendix 5, which also includes detailed transcript of theinterviews. Each of the interviewees asked not to be named in the paper, therefore they are onlynamed by the positions they perform. Furthermore, the results of assessment using the scoringmethod are presented in detail in Appendix 6.Interview 1: President of SIFE Salford (PoSS) Comments on the criteria chosen by the experts through surveyPoSS analysed the criteria and stated that the duration of the project should be judged along theother criteria because we have a big turnaround of volunteers in SIFE and on average they work for ayear, therefore short projects are more successful than long, unless the same project leader remains.On the other hand PoSS argued that the payback criteria is irrelevant to our organization as the onlything we invest is time so it is difficult to measure such thing. The suggestion is to change paybackinto impact. Accordingly, the comment on Social Return on Investment criteria indicated thatalthough it is important criteria it is very difficult to estimate. Finally, PoSS stated that risk analysis isvery important, although most of the time projects are very risky so there is a need to find a balancebetween projects. Comparison of the two methods: scoring and Analytical Hierarchy Process (AHP)PoSS has described the scoring method as very straight forward, easy to understand and fast – givingthe results just after scoring all criteria and projects. However, the AHP has been described as morechallenging, asking more questions which made the expert think about the projects and criteria. Itput all scoring, selecting into perspective and give the idea of broader environment. Moreover, PoSSstated that comparison of projects and judging them against each other and criteria as used in AHP
  64. 64. 55method gives deeper analysis and more accurate scores. Furthermore, PoSS appraised the ExpertChoice software as easy to follow and navigate, which made selection process easy. Analysis of usefulness and appropriateness of methods presented for SIFE SalfordPoSS stated that both of the presented methods are worth implementing. However, the AHP is morereliable in my opinion as it makes the expert think more deeply and pair comparison gives moreaccurate scores. Moreover, the possibilities of Expert Choice – graphic display of results and easycombination of judgments of different experts makes the whole process very smooth and easy. Implementation of the selection methodsPoSS agreed that implementation of selection methods is worth for every organization, especially likeSIFE Salford. The importance of demanding the application forms similar to project descriptions wasnoted. PoSS would choose the AHP method to implement, however the only constraint is cost of thesoftware, if there was a free application to use then it would be implemented.Interview 2: Project Manager (IPM1) Comments on the criteria chosen by the experts through surveyAccording to IMP1 the criteria chosen by the experts are accurate. However ‘payback’ is too generalcriteria for IMP1 and would change it to impact. Moreover, IPM1 would add one extra criterion –effort required by the social enterprise. Comparison of the two methods: scoring and Analytical Hierarchy Process (AHP)Scoring method: Clear and easy method to implementin any organization Does not need extra resources, mightbe implemented in any spreadsheet. This method shows you clear choice –top score No advice in case of the same result For bigger organizations process ofchoosing project might be too simple,not many factors
  65. 65. 56AHP/Expert Choice: Confronts criteria as well as projects Gives more complex results Difficult to get the same results fortwo projects More illustrative method Requires software Different ways of assessing criteriaand projects are not synchronized(two gives 1-9 scale, one can give 1-90) huge errors might occur Analysis of usefulness and appropriateness of methods presented for SIFE SalfordIMP1 suggested that selection methods are very useful for the organization to implement. However,for the beginning expert would implement scoring method, and once the SIFE Salford grows the AHPcould be implemented if the software is free. Implementation of the selection methodsIMP1 would definitely implement AHP method; however the cost of the software is the mainconstraint. The process of implementing Expert Choice and AHP would require organization to trainthe people how to use the software properly, as lack of experience might provide to errors andwrong decisions. Moreover, people have to be convinced to software results, because very oftenthey might be different than results based just on judgments.
  66. 66. 57Interview 3: Community & Volunteering Manager (CVM) Comments on the criteria chosen by the experts through surveyCVM was surprised that duration has not been included as criteria as well as that expert chosen thepayback over the impact, which is more important in social enterprises. Regarding the budget, CVMargued that it is not that important criterion to analyse as if the project is worth doing then somefunding will be always available. Comparison of the two methods: scoring and Analytical Hierarchy Process (AHP)CVM has never used any of the selection methods despite long experience in working with projects.CVM valued AHP over scoring method mainly because the comparison of projects made expert focusand analyse more deeply. Accordingly, the AHP method is more accurate as during judging there wasdeep analysis involved, while the judging in scoring method took only few minutes without actualconsideration of options. Analysis of usefulness and appropriateness of methods presented for SIFE SalfordCVM would the AHP method for SIFE Salford, as it allows scoring by different experts and thencombines their scores. It is very efficient and would speed decision making process, as there arealways too many discussions over such topics. Also, AHP helps with smart decision making as it asksmany questions during the scoring process, while the scoring method is very limited and too fast. Implementation of the selection methodsCVM would certainly implement the AHP method. However, CVM states: I think it is not only useful inselecting projects to the project portfolio but has many other potential applications such as choosingthe right supplier for the event.
  67. 67. 58CVM would adjust the criteria to the organization and case, then ask external organization writeproposal in bit more detail, but not too much – to make the process easy. CVM suggested thatexplaining the method to the experts is crucial as understanding is a key to the assessment.Interview 4: Project Member/Associate (IPA): Comments on the criteria chosen by the experts through surveyIPA stated that the Social Return Investment criteria could be more explained, how this will beachieved and measured. Further, IPA would change payback criterion to number of volunteersneeded. Moreover, IPA believes that time/duration should be a criteria, because SIFE Salford is astudent driven organization, and members have limited time, which is main constraint Comparison of the two methods: scoring and Analytical Hierarchy Process (AHP)According to IPA the scoring method is much easier to implement and use, because it is verystraightforward. At the same time, the AHP made it difficult to judge against the criteria, howevermade expert think and analyse more deeply. Analysis of usefulness and appropriateness of methods presented for SIFE SalfordIPA states that both methods would be very beneficial for the SIFE Salford. IPA would initiallyimplement the scoring method, and with the progress and more complex decisions the AHP. AHP: Ithink AHP would be beneficial to implement in further stages as it allows updating the informationduring the progress of the projects, and such analysis would help the management with furtherportfolio decisions.
  68. 68. 59 Implementation of the selection methodsIPA would generally improve the criteria and adjust them to the organization that needs selectiontechnique. Then IPA would train people about the whole process and the purpose – choosing themost suitable project for the organization. Further suggestion stated that improving the projectdescriptions by providing more background information of the projects would be beneficial withsome summary; more detailed information would be needed from organization. IPA: I wouldcertainly consider implementing AHP method, if there was freeware software to use it with.3. Results of scoring method assessmentIn summary experts learnt the mechanism of the scoring method and judged it as very easy to useand implement. The straightforwardness of the method has been main advantage of it. However,experts learnt after using the second method – AHP, that scoring method is not very demanding anddid not make them analyse or consider options in greater detail.Each expert was asked to score projects against the criteria (details in Appendix 6); the summary oftheir scores is presented in a table below.Expert / Project Project A Project B Project CExpert 1: President of SIFE Salford (PoSS) 43 71 72Expert 2: Project Manager (IPM1) 55 60 64Expert 3: Community & Volunteering Manager (CVM) 34 60 57Expert 4: Project Member/Associate (IPA) 52 73 82Total score 184 264 275Table 5. Results of scoring method assessment
  69. 69. 604. Assessment results and applications of the Expert ChoiceEach expert has learnt how to use the Expert Choice which is software that manages the AHP methodto allow judgments and scoring in user friendly environment. Experts valued the method because ofthe comparison aspect of criteria and projects which made them judge and analyse in greater detail.Also, they believed that AHP presented more accurate score because of the cross judging and morethoughts that were put in judging than during scoring method assessment. Moreover, the softwareallowed easy combination of score of the projects but also put into consideration the combinationweight given to criteria, which has been skipped in scoring method.The combined results of the assessment are presented below.Graph 20. Combined results of AHP assessmentThe graph above shows the combined score for the project made by four experts. It also indicatesthe weight of the criteria used in the pillar graph on the bottom. The results of judgments of eachindividual expert are presented in Appendix 7. The Expert Choice software with the file used for theassessment has been placed on DVD added to this dissertation for further analysis and presentationof results.
  70. 70. 61V. Analysis and DiscussionThis chapter brings together analysis of the literature and researches of other authors and researchundertaken in this dissertation. Both sources were used to answer the research questions andaddress the objectives settled in the beginning of this paper.Objective 1: The analysis of the projects criteria to outline the mostimportant and adequate for the process of selection into projectportfolioEvery project is very complex and consists of many elements, which have to be analysed whenselecting projects into project portfolio. Wysocki (2003) admits that there are many criteria outlinedby various authors that are significant and need to be taken into consideration. However, the socialenterprise is often small or medium business which has not enough resources to allow deep analysisof each of them, according to interviewed project manager (IPM1). Therefore, the ranking createdusing the survey, outlined top five criteria, which should be analysed in detail by social enterprises,this include: financial stability (of an external organization), payback, social return on investment, riskanalysis, budget. This ranking has been created after receiving responses from twelve independentexperts. However, Cooper (2001) argues that the project should have a strategic alignment withmission of the business and those that do not fit should not be taken into consideration. Martino(2003) adds analysis of the competition as important criteria; however for the social enterprise it isinsignificant as the projects in most cases are submitted to organization not by the business.However, it is interesting aspect if enterprise is applying for the grant, then analysis ofmicroenvironment would be helpful. On the other hand, Cleland (2003) mentioned duration of theproject as important criteria, which has been outlined in the project description, but not analysed asa criteria. However, Community & Volunteering Manager (CVM) and President of SIFE Salford (PoSS)commented that duration should be also analysed as criteria, agreeing with Cleland (2003), because
  71. 71. 62there is a big flow of volunteers and average time worked is one year. Furthermore, Levine (2007)and Westerveld (2003) outlined payback as very significant criteria; however CVM, interviewedproject associate (IPA) and PoSS argued that payback is not significant as it is difficult to estimate andmeasure, therefore it is inaccurate. PoSS suggested that payback could be changed to impactanalysis, which is more important for social enterprise.Stewart and Mohamed (2002) outlined that many authors focus on economic criteria such as returnon investment, cost-benefit analysis, and net present value. However, these have to be applied tosocial enterprise case. All interviewees agreed on significance of Social Return on Investment (SRI)criteria in project selection. While, regarding the financial stability criteria, the PoSS and IPM1recognize the need of analysis of this area, but mention that it is important to analyse how theproject will be treated by that organization. If the project is independent and has its own budget,then the financial situation of “employer” does not matter to social enterprise, unless it is paid ininstalments.Rad (2006) mentioned that the size of the budget is an important criterion, however should not be akey criterion. This is very true in social enterprise projects. PoSS mentioned that most of the projectsthey do have limited or no money and they run fundraising activities to make them happen.Accordingly, if a project has some sort of budget then it is very helpful, but if the project addressesthe social need, then this constraint can be easily overcome with a help of sponsors and partners. Onthe other hand, IPA stated that budgets ease and speed up the progress of the project, and if there isa need to complete many projects by the organization in short time (i.e. competition coming up),then it is important to choose one with solid financial backup.Finally, all the experts agree that risk analysis is crucial criteria, which helps with creating a balancedportfolio, where organization should have some risky but rewarding projects and those certain withless rewards.
  72. 72. 63In summary, the five project criteria concluded through survey and commented in interviews are themost appropriate for the social enterprise, with one exception of payback, which according to PoSSand CVM should be exchanged with impact analysis (placed 9thin the ranking). Visitacion (2006) andLevine (2007) emphasize that each project should be firstly analysed if it fits to the organization’sstrategy, mission and objectives before going through the selection process and interviewees agreedwith that. Projects that do not fit to portfolio or similar already exist should not be taken intoconsideration.

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