A fuzzy sets approach to new product portfolio management

The evaluation of R&D projects in a high technology firm is very important. A lot of them quite often do not lead to new products as management did not take into consideration indexes such as probability of commercial success, technological success, strategic fit, etc which cannot be expressed in a quantitative form. An efficient and reliable approach for evaluating R&D projects capable of handling simultaneously the quantitative and qualitative criteria involved based on the theory of fuzzy logic is presented and a software model of the approach has been developed and tested in a real environment. It is a multiple criteria decision-making method where all projects are rated according to a number of quantitative and qualitative criteria capturing possibilities of technical and commercial success and the consistency of the projects with business strategy. We report on the criteria used for the evaluation of the projects and on the operation of the software model.