Investment Selection in Complex Multinational Projects

Investment Selection in Complex Multinational Projects

Kenneth David Strang (School of Business and Economics, State University of New York, Plattsburgh, NY, USA & APPC Research, Sydney, NSW, Australia)
DOI: 10.4018/ijitpm.2014040105
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Abstract

Project executives believe complex multinational investment selection is complicated because there are many criteria to evaluate and the decision-making theories are difficult to implement in practice. The 2008 global recession has forced companies to rebalance existing programs and products. Thus, project selection is not merely a go/no-go decision for a single project but instead it is a multiple-criteria factor analysis of multiple new proposals – and whether to continue existing projects. Different selection approaches can produce opposite outcomes when applied to the same situation. Qualitative techniques such as managerial preferences or Delphi consensus building are subjective. Objective quantitative methods such as Markov analysis, linear programming and search heuristics are grounded on rigorous calculus theory, but they produce a single result (not priorities). Also, quantitative techniques may omit important managerial insight. This study demonstrates how qualitative and quantitative selection techniques can be combined for complex multinational investment decision making at a Virginia-USA-based coal mine company that generates electricity.
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Literature Review

Portfolios have different meanings across disciplines. In finance they refer to investments of stocks, bonds, treasury bills, and so on (Mills & Patterson, 2009). In new product development (Cooper & Edgett, 2008; McNally, Durmusoglu, Calantone, & Harmancioglu, 2009) and strategic business planning, portfolios are considered to be limited-duration projects or longer-term programs (PMI, 2008). Human resource recruiting and development has been analyzed as portfolios in terms of competencies and learning abilities (Ngwenyama, Guergachi, & McLaren, 2007). In fact teacher portfolios and student learning portfolios are contemporary formative assessment mechanisms found in higher education (Strang, 2010a).

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