Mathematical programming models of RandD project selection: a case study of technology adoption at BMW.
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RandD project selection is a critical interface between the product development strategy of an organization and the process of managing projects day-to-day. Researchers in operations management have developed elegant mathematical programming methodologies for project selection since the early 1960s. However, there seems to be little use of these methodologies in practice. This article describes the project selection problem faced by the transmission pre-development group of BMW. The group had to choose a portfolio of projects to set the foundation for the "best powertrain 2000". This problem of project selection was structured as minimizing the gap between target performance and actual performance along chosen criteria. A mathematical programming model helped this organization to increase the transparency of their selection process, which previously had been based on experience coupled with evaluation of individual projects in isolation. However, in spite of this successful implementation of a new project selection "method", the organization did not use the model for optimization...