Project Portfolio Management: planning, selecting, and executing Development of a framework for prioritizing between innovation projects at a forest industry company

Abstract

Following a recent restructuring and new strategic directives, the Packaging Solutions Business Expansion team (PSBE) at Stora Enso has begun to question how it works with project portfolio management (PPM). This study explores the usefulness of a formal PPM process for designing PSBE’s project portfolio and proposes a context specific framework for handling this. The research is qualitative in nature, based on interviews with PSBE team members and representatives from external companies. The internal interviews explored the current needs and challenges of PSBE, while the external interviews provided insights into how other organizations work with PPM. While the externally interviewed companies offer insight and best practices, differences in context mean that their practices cannot be directly applied to PSBE. The findings indicate that PSBE currently selects and prioritizes innovative project ideas in an informal manner, and faces certain challenges related to it. A formal PPM framework could help address these challenges. This research has led to a set of recommendations for PSBE on how to work with PPM effectively. The proposed PPM framework encompasses three phases: planning (setting strategic focus and deciding on evaluation methods, including financial metrics, scoring models, and visualizations), selecting (building the actual project portfolio through activities such as evaluating individual projects and considering interdependencies and resource constraints), and executing (realizing projects through continuous monitoring and incorporation of lessons learned). Involvement of stakeholders throughout the process is crucial for success.