| Some successful technologically-based firms that are committed to original research and development (R&D) develop a growing tendency to prefer incremental projects, often to the exclusion of revolutionary projects. Analysts have cited this management decision behavior as a major cause of a firm's inability to sustain competitive advantage when followed over a prolonged period of time. A conceptual framework was developed to encourage decision makers to include both incremental and revolutionary projects in their R&D portfolio. The core elements of the conceptual framework are the four dimensions for sustaining competitive advantage: competitiveness, innovativeness, attractiveness, and responsiveness. Each dimension contains decision criteria by which to evaluate projects. These criteria include the readiness of the firm to perform the project in terms of the four technological components: technoware (tools), humanware (skills), inforware (facts), and orgaware (methods), as well as a project's capacity to improve the firm's capability (efficiency) and competency (effectiveness). The framework is operationalized as a toolset that facilitates management practice. The toolset includes (a) a project evaluation form which contains, for each criterion, a list of descriptive values spread across a scale which is uniform for all criteria; (b) a set of pairwise comparison matrices with which to assign the relative importance of each criterion; (c) a weighted scoring model that combines scores and weights to rank projects; and (d) radar diagrams that provide feedback. A firm can adjust the values of the scale so that the toolset will produce a rank ordered list of projects having a desired mix of attributes. This research also addressed a generalized process for developing multi-criteria management decision making frameworks. A field study was conducted in which R&D program managers from different firms (including both profit and not-for-profit) representing a wide variety of competitive environments utilized the framework for a sample of their R&D projects. Field study participants found that use of the framework improved the decision process in terms of objectivity, consistency, transparency, accountability, and traceability. It also enabled them to better appreciate the value of many of their projects. |
