Portfolio management

In interviews of R D management during 2004, comments by research managers on portfolio management included ... 

In the past, we were seduced by portfolio management tools. 

A portfolio manager has 100,000 to invest in a list of 20 stocks. She estimates the return from stock i over the next year as r(i), so that if x(i) dollars are invested in stock i at the start of the year, the end of year value is [1 + r(/)] jt(/). Write an MILP model that determines the amounts to invest in each stock in order to maximize end-of-year portfolio value under the following investment policy no more than 20,000 can be invested in any stock, and if a stock is purchased at all, at least 5000 worth must be purchased. 

Portfolio management concepts have been an accepted component of the financial services realm for decades, and the need to diversify risk continues to be an effective organizing principle for many financial instruments and analytic techniques. Risk assessment is also a key component in the pharmaceutical world, where as few as 1 in 5000 laboratory-tested compounds ever makes it to the market. As such, the pipeline portfolio is a critical indicator of the future of a pharmaceutical firm, and the process of analyzing and managing it effectively is of vital strategic importance. 

Expanded drug development framework with strategic options for pipeline portfolio management. 

D3mamic modeling methodology provides a unique way to address portfolio management problems in the pharmaceutical industry. 

Aggressive portfolio management in early phases of development. 

Site projects All projects related to the existing process or the projected improved state of the process at a specific site Site head Process owner Leadership team Site project portfolio manager Process stakeholders Corporate quality assurance counterpart QMS office... 

Erb, Harvey and Viscanta Expected Returns and Volatility in 135 Countries. The Journal of Portfolio Management, Spring 1996. Cf also by the same authors Political Risk. Economic Risk, and Financial Risk. Financial Analysts Journal, November/December 1995, and Do World Markets Still Serve as a Hedge The Journal of Investing, Fall 1995. 

Professional Management Few investors have the time or knowledge to analyze companies and securities, study forces that influence the economy, and assess trends in financial markets. With mutual funds, individual investors gain access to professional portfolio management at bargain rates. 

This workshop focused on factors such as work processes, systems, and technologies that could enable and accelerate the pace of innovation and increase the yield of major innovations from work in the basic chemical sciences. More specifically, speakers identified teamwork, commitment, standardized portfolio management, clear goals, well-defined milestones, and effective technology transfer as some of the characteristics of innovative institutions and practices. Successful approaches to innovation have taken place in different environments and between different environments—despite infrastmcture and cultural differences, both interdisciplinary collaborations and collaborations between industry and academia have proven beneficial for all parties. Funding must also be available to promote innovation at stages of research often ignored. 

Clamen envisioned an ideal environment for innovation. It should have an open, sharing culture and customers who are active in setting product targets. Innovation should be considered vital to the business strategy, and structured processes should be used for both innovation and portfolio management. 

Robert W.R. Humphreys, National Starch and Chemical Company Allen, you talk about your innovation process, which is not too different from the one we use. When you re doing portfolio management and a lot of projects are coming through, you ve got to make decisions. The quality of your portfolio management team is obviously a critical thing or there will be many mistakes that won t be discovered for a long time. How do you choose that team ... 

Allen Clamen The quality of the data, the input that goes in, is determined by the effort of the portfolio planner before all the portfolio management team s meetings. These can take place once a month, once a quarter, or as often as is necessary to select projects. All of those data go into the portfolio tool through the database and are collected. 

Mary L. Mandich, Lucent Technologies Do you think that portfolio management prevents that or that... 

Participant I think portfolio management helps limit the amount of resources wasted on these kinds of issues. 

David J. Soderberg, BP Chemicals You mentioned a very coherent and concise set of tools that are used portfolio management, fuzzy front end, and stage gate. Those work very well within a business unit context. They re very focused and allow you to allocate resources. 

Allen Clamen That s still a big challenge for us. As I mentioned, the portfolio management was all within the business context. There is a roll-up intended, which hasn t happened yet, among all businesses so that we can start to look across businesses. What does the whole profile look like What does the company portfolio look like ... 

Mary L. Mandich What is the rationale, and would portfolio management of some sort help remedy this issue ... 

Andrew Kaldor But, Larry, do you have a thought on how you accomplish portfolio management in the public sector ... 

On the corporate level, there is evidence that portfolio management can be a significant driver of value creation for chemical companies, both for good and ill. 

Project portfolio management besides the obvious prioritization by value, it is necessary to have a clear understanding of foreseeable risks and available capabilities as well as the fit with the application roadmap ... 

---