This chapter describes and details the P3S-VB model: the Selection of Projects and Programs Portfolio Based on Value. The P3S-VB contributes to the discipline of project management and portfolios, in the definition of the constructs of an appropriate level of incorporation of capabilities, value and technology; identification of the range in which technological capabilities, projects and portfolios can create value; the processes for selecting the portfolio of projects based on value; and the alignment of benefit management and project management. The model was designed keeping the rigor of scientific research, following as a reference the DSR-IS science design method, with a focus on practical applicability.
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The strategy is the coupling that the company performs between its internal resources and capabilities, its response to the opportunities and risks of the external environment of the company (Grant, 1991), and the creation of value (Lepak, Smith & Taylor, 2007; Normann & Ramirez, 1998). The strategy aims to identify the investments required to maintain, develop, incorporate and extend the resources and capabilities required by the company to achieve long-term sustainability (Chung et al., 2016; Helfat & Winter, 2011) (López-Cabarcos, Göttling-Oliveira-Monteiro, & Vázquez-Rodríguez, 2015; Maniak et al., 2014; Teece, Pisano & Shuen, 1997; Winter, 2008). For which, the successful implementation of the strategy is achieved when the delivery of value to the stakeholders is maximized, balancing the risks, and optimizing the use of the resources required to achieve it (Costantino, Di Gravio, & Nonino, 2015). Despite this, organizations, on average, only reach 63% of the promised financial return on their strategies, and in 66% of the companies the strategy is never executed (Johnson, 2004; Kaplan & Norton, 2008; Mankins & Steele, 2005).
The project portfolio as a strategic tool contributes to the development of business goals and objectives (Vitolo & Cipparrone, 2014). The main component of this purpose is the Selection of Portfolio Projects PPS, maximizing the balance between resources, risks, capabilities, and value to be created (APM, 2006; IPMA, 2006; Kodukula, 2014; PMAJ, 2005; PMI, 2017b; Turner, 2008). PPS has been studied at the academic, business and industrial levels (Archer & Ghasemzadeh, 1999; Artto et al., 2008; Bonham, 2005; Cooper, Edgett, & Kleinschmidt, 2001; Crawford & Cooke-Davies, 2012; Dickinson, Thornton & Graves, 2001; Ginzberg, 1979; Henriksen & Traynor, 1999; Huang et al., 2015; Kundisch & Meier, 2011; Levine, 2005; OGC, 2011; Patanakul, Curtis, & Koppel, 2013; PMI, 2017b).
There is evidence of the positive contribution of PPS practices in the alignment of the portfolio with the purposes, objectives and strategies of the companies, both for the incorporation of organizational capabilities and in the development of competitive advantages (Buschle & Quartel, 2011; Chiang & Nunez, 2013; Kaiser, El Arbi, & Ahlemann, 2015; Maes, De Haes, & Van Grembergen, 2015; Say, Fusfeld & Parish, 2003; Too & Weaver, 2014; Voss & Kock, 2013). However, the literature on portfolio management and PPS has paid little attention to value management concepts (Martinsuo & Killen, 2014). In the last decade, increased research, from academia and industry, proposes the need to broaden the definitions of value in the portfolio (Augusto Oliveira et al., 2010; Bolsinger, Bewernik, & Buhl, 2011; Kopmann et al., 2015; Winter & Szczepanek, 2008).