Picking ground-breaking new projects for more investment and expansion is perilous and difficult since fresh ideas are characterized by major technological and market ambiguity. There will forever be some winners and some failures in the process of evaluating Capital Investment projects for funding, but no one desires to be the decision-maker who failed to recognize a fantastic investment.
As per research, project selections can go awry due to the following 5 issues in the expert panel created to select the project:
- Predisposition against fresh concepts.
- Absence of diversity in expert panels.
- More focus on technical facets.
- Bias of the panel member introducing the project.
- Timing plays a major role.
An organization’s product lines, processes, and services can be revitalized, it’s functioning and competitiveness enhanced by the choice of a good R&D project. Leaders have to comprehend the points where R&D selection panels may make mistakes for them to better their performance of selecting appropriate projects. Research demonstrates that by comprehending the conceivable pitfalls and improving the process, organizations can make wiser judgments and produce enhanced outcomes.
There are several means that can be used before, during, and after selecting strategic initiatives to bring down biases and enhance selections for additional investment. By following the undermentioned best practices before, during, and after selection, decision-makers can make smarter choices when deciding on which projects to invest in:
Pre-selection
- Conceal Names & Demographics
- Homogenize Submissions (Heilmeier Catechism)
During Selection
- Pursue Diversity
- Apply Crowdsourcing
- Adopt Workshop Approach
- Entrust to Probability
- Organize One-on-one Contests
Post-selection
- Give Feedback
- Gain from Failures
Granted these procedures may entail deployment of certain resources and effort, but they are anticipated to cost less than the conventional way of selection, which extensively relies on time and effort of senior managers and technical subject matter experts.
Let us look at some of the best practices in a little more detail.
Conceal Names & Demographics
One way of removing bias is to conceal the names and demographic information of the persons who are pitching strategic initiatives for selection. Limited research has suggested that concealing names and demographic characteristics in science submissions escalates the chances receiving grants for women.
Although masking submissions is a significant first step but organizations may have to take supplementary steps to detect biases.
Homogenize Submissions (Heilmeier Catechism)
Comparability is necessary for similar themed project ideas. A standardized way of developing proposals makes it easier to evaluate the initiatives. A comprehensive, uniform template for proposals can make comparability possible. This was demonstrated in a concept known as Heilmeier Catechism, coined by George Heilmeier, director of a U.S. research organization, in the mid-1970s.
Heilmeier Catechism is also employed as a screening technique to aid project proposers appraise whether their ideas have a possibility of being approved.
Pursue Diversity
An increasingly varied selection panel aids in reducing biases and furthermore it results in products that are more attractive to people with varied requirements and interests.
Research has shown the significance of diversity across several aspects—not only demographic features but also professional capability and backgrounds as well.
Interested in learning more about Project Investment Selection Best Practices? You can download an editable PowerPoint on Project Investment Selection here on the Flevy documents marketplace.
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