Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case study of SIFE Salford.

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UNIVERSITY OF SALFORD
BUSINESS SCHOOL
BUILDING A PROJECT PORTFOLIO IN THE SOCIAL
ENTERPRISE. ANALYSIS AND IMPLEMENTATION OF
PROJECT SELECTION METHODS. CASE STUDY OF SIFE
SALFORD.
MARIUSZ ANDREASIK
Dissertation submitted in partial fulfilment of requirements for the
degree of MSc in Project Management.
University of Salford 2009.

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Declaration
I declare that no part of this dissertation has been taken from existing published or
unpublished material without due acknowledgement and that all secondary material used
therein has been fully referenced.
Signed ..............................................

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Abstract
Title of dissertation: Building a project portfolio in the social enterprise. Analysis and
implementation of project selection methods. Case study of SIFE Salford.
Author: Mariusz Andreasik
Summary:
The dissertation aims to help the social enterprise – SIFE Salford with creating the portfolio
of projects. The paper focuses on selection method that the organization may use while
choosing from the projects submitted by external enterprises. This process is very complex
and it is often difficult to make sound decisions, therefore introducing the methods and the
process is essential and beneficial for every organization. The author examines two
methods: the scoring and Analytical Hierarchy Process (AHP). The analysis of those methods
is made to decide which one is more suitable and useful for a studied organization.
Furthermore, the methods are analysed and studied how they can be applied and used in
social enterprises. The survey and interviews with experts from the field aim to create
guidelines for the SIFE Salford, how to use the techniques and benefit from them.
Consequently, the President and Directors of the enterprise are trained during interview
process to use studied methods that they can easily implement in upcoming academic year.
This condenses the aim of the dissertation, which is to experiment the selection methods
that could be a practical use for a social enterprise to ease a process of selecting process. It
also introduces the concept of project portfolio management into the sector.

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Table of Content
I. Chapter: Introduction.................................................................................................................1
1. Introduction ...............................................................................................................................1
2. Research objectives....................................................................................................................5
II. Chapter: Literature review .........................................................................................................7
1. Project........................................................................................................................................7
2. Project Portfolio .........................................................................................................................7
2.1. Project Portfolio Management...............................................................................................8
2.2. Balanced Portfolio..................................................................................................................9
2.3. Operating a Project Portfolio ...............................................................................................11
2.3.1. Establishing Portfolio Strategy .........................................................................................12
2.3.2. Evaluating Project Alignment to the Portfolio Strategy....................................................12
2.3.3. Prioritizing and selecting Projects....................................................................................13
2.3.4. Selecting Balanced Portfolio Using the Prioritized Projects..............................................14
2.3.5. Managing the Active Projects...........................................................................................14
2.3.6. Summary of project portfolio development.....................................................................15
2.4. Project life cycle ...................................................................................................................15
2.5. Benefits of project portfolio.................................................................................................17
2.6. Problems ..............................................................................................................................18
3. Project Selection methods .......................................................................................................19
3.1. Criteria weighting method ...................................................................................................20
3.2. Analytical Hierarchy Process method...................................................................................24
III. Chapter: Methodology .............................................................................................................33
1. Secondary research..................................................................................................................36

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2. Primary research ......................................................................................................................37
Stage 1: Survey.................................................................................................................................39
Stage 2: Interview ............................................................................................................................41
Stage 3: Expert Choice assessment ..................................................................................................43
3. Ethical issues ............................................................................................................................49
Summary..........................................................................................................................................50
IV. Chapter: Research Findings and Results...................................................................................51
1. Survey Results ..............................................................................................................................51
2. Interview results...........................................................................................................................54
3. Results of scoring method assessment ........................................................................................59
4. Assessment results and applications of the Expert Choice...........................................................60
V. Analysis and Discussion............................................................................................................61
VI. Conclusions and recommendations .........................................................................................71
Reflection on the extent to which the research aims were accomplished...........................................73
Appendix 1: Survey implementation....................................................................................................74
Appendix 2: Project Descriptions .........................................................................................................76
Appendix 3: Interview questions..........................................................................................................79
Appendix 4: Overview of SIFE Salford (studied social enterprise)........................................................80
Appendix 5: Transcript of interviews ...................................................................................................81
Appendix 6: Scoring method assessment results.................................................................................87
Appendix 7: AHP method assessment results......................................................................................91
References ...........................................................................................................................................95

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Table of Graphs
Graph 1. Different positions and roles of social enterprises ..................................................................2
Graph 2. Bubble diagram of a portfolio of new-product projects........................................................10
Graph 3. Project Portfolio Management..............................................................................................11
Graph 4. Project Life Cycle ...................................................................................................................15
Graph 7. Portfolio project life cycle......................................................................................................17
Graph 8. Process of managing portfolios successfully..........................................................................20
Graph 9. Advantages of the Analytic Hierarchy Process ......................................................................30
Graph 10. Four elements of research...................................................................................................33
Graph 11. Types of research ................................................................................................................35
Graph 12. A classification of secondary data .......................................................................................37
Graph 13. Expert Choice main screen ..................................................................................................45
Graph 14. Expert Choice criteria analysis.............................................................................................46
Graph 15. Expert Choice project assessment screen ...........................................................................46
Graph 16. Expert Choice decision screen 1 ..........................................................................................47
Graph 19. Detailed survey analysis ......................................................................................................52
Graph 20. Combined results of AHP assessment .................................................................................60

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List of Tables
Table 1. Scoring method ......................................................................................................................22
Table 2. Explanation of rating answers ................................................................................................40
Table 3. Categories of problems that have been addressed by Expert Choice.....................................44
Table 4. Ranking of the criteria ............................................................................................................53
Table 5. Results of scoring method assessment...................................................................................59

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Preface
Acknowledgements
Special thanks to Jan Andreasik how inspired me to analyse the project portfolio
management for the SIFE Salford, after expressing big interest in the enterprise activities.
Further thanks to Marta Karaś for supporting me throughout the process of researching and
writing up the dissertation.
Thanks to Łukasz Szczekala for a company while writing the dissertation, especially during
the breaks between the chapters or sections.
I would like to thank my supervisor Kevin Kane for the great and smooth cooperation while
working on this dissertation.

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Personal statement
After two years of developing the social enterprise – SIFE Salford as a Chairman and then
Vice-President, leading the team to semi-finals of United Kingdom national competitions, I
have decided to research techniques that could help with further development of the
operations. The main challenge we faced was choosing the right projects to commit to. We
had made few wrong decisions, when we worked on a project which was not beneficial to
our organization and did not meet our strategic objectives; therefore it was complete waste
of resources and time. Consequently, I focused this dissertation around the methods that
could help future leaders avoid such mistake. Accordingly, I believe that throughout the two
years we developed an interesting project portfolio that needs appropriate management
and approach.

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I. Chapter: Introduction
1. Introduction
Background of the research
Social enterprises are independent businesses that provide services, goods and trade for a
social purpose and are non-profit distributing (Policy Action Team 3, 1999). In social
enterprises profits are used to create more jobs and businesses and to generate wealth for
the benefit of the community (Community Business Scotland, 1991). Therefore, the role of
the social enterprises is growing and it has been pursued by governmental and
entrepreneurial agencies, to boost the trade within the businesses (Ridley-Duff, 2007). The
following graph represents the forces influencing the social enterprises.

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Graph 1. Different positions and roles of social enterprises (Ridley-Duff, 2007)
From the graph above the observation can be drawn that social enterprises are key element
of strategy of businesses, government and associations. Also they help society, communities
and families develop. This is achieved through the services and goods they provide, but
mainly the projects which they work on. Those are funded by those organizations as part of
their Corporate Social Responsibility strategy or as a result of negotiations with Councils,
who ask for help in the area.

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Significance and importance of the research
According to Cabinet Office (2008) there are at least 55,000 social enterprises operating in
the United Kingdom. And the UK government prepared the Social Enterprise action plan,
which aims to increase a number of them and provide help, advice and support for those
who want to start this type of business. BusinessLink.gov.uk has been set up as a
partnership of the government and businesses to provided that to everyone who thinks
about starting their own business (BusinessLink.gov.uk, 2009).
On the other hand, the businesses and associations also provide support for social
enterprises as well as funding for the projects in the given area of interest of given
companies. For example Setas (Social Enterprise Training and Support, 2009) listed just 20
sources of funding from various associations and companies for start ups and community
projects.
Many social enterprises focus on winning grants to carry out the projects that make change
in the local community and individual lives. Those are funded by various bodies who want to
help achieve that aim. However, established social enterprises do not have to apply for
grants and finances. They are being approached by organizations who ask for help to carry
out given projects.
Therefore, they face the problem of having many project applications, which cannot be
completed due to limited resources. There is a need for prioritizing and categorizing projects
in order to accept them into project portfolio of given organization. Many project
applications are unclear and the benefits are not visible from the beginning, making it
harder to asses. Accordingly, the social enterprises struggle to choose the appropriate
projects to carry out, which will benefit them and community they serve.

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Aim of the research
To solve this problem the Multi-Criteria Decision Analysis (MCDA) needs to be implemented.
The aim of MCDA methods is to support decision-makers with indentifying problems,
system values, objectives they have and other parties involved. This is made through
exploration of above in the context of problem to guide them in identifying a preferred
course of action (K.M. Al-S. Al-Harbi, 2000). In this case, allowing them to choose the most
suitable and achievable project. This means that resources available will allow to complete
the project successfully, and that will be within the aim and mission of the organization. One
of the MCDA methods is Analytical Hierarchy Process (AHP) method, which will be
introduced in methodology chapter.
The implementation of the AHP method will be studied on the case of social enterprise
called SIFE (Students in Free Enterprise) Salford. This is a student organization which has
very ambitious mission statement: To create sustainable value by successfully empowering
and educating the local community and students with the necessary financial end
entrepreneurial skills needed to improve their standard of living and inspire them to take on
real life opportunities (sifesalford.org, 2009). The organization is working currently on five
projects and receives many applications from local associations; community centres and
groups to help on the projects. Due to lack of tools that help with making choice which
projects should be done and will benefit the organization and community, the SIFE Salford
takes projects randomly and denies those that could be more beneficial (SIFE Salford
President, 2009).
Therefore, a system and method for prioritizing and choosing the project into projects
portfolio needs to be implemented.
The research needs to be undertaken to find out the most important and crucial criteria
used in assessing the projects. This will be made by surveying the experts in the field of

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project management and social enterprises. Further, they will participate in interviews to
assess three example projects based on the created project description according to five top
criteria (derived in the survey) whether they should be accepted to the project portfolio.
This will explain the procedures and process the SIFE Salford need to undertake in the future
when creating its portfolio. The Experts will use the AHP method implemented and
administrated through use of Expert Choice software to assess the example projects.
The issue is whether the introduction of Multi-Decision Criteria system will benefit the
organization and ease the process making it more efficient. At the same time, allowing
members to work on the projects that are relevant to the organization objectives. On the
other hand, experts will be able to choose within the projects by looking only at the
descriptions provided by submitting organization. Those two methods will be assessed by
experts who will make their judgments during interviews.
Issues and problems will be researched in the light of relevant literature. Further the field
research will be performed in order to find the most suitable solution for the studied social
enterprise.
2. Research objectives
 The analysis of the projects criteria to outline the most important and adequate for
the process of selection into project portfolio
 Analysis of the prioritization and selection methods of projects in project portfolio
management
 Research the usefulness and appropriateness of the analysed methods in selecting
and prioritizing projects in project portfolio management

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 Implementation of the Multi-Criteria Decision method – Analytical Hierarchy
Process (AHP) in social enterprise, on the case of SIFE Salford for a project portfolio
management

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II. Chapter: Literature review
The main area of study concerns Project Portfolio Management (PPM) and the literature
review will be performed to outline the main concepts in this area.
1. Project
Firstly, the understanding of the project is very important. Wysocki (2003) defines: A project
is a sequence of unique, complex, and connected activities having one goal or purpose that
must be completed by a specific time, within budget, and according to specification. On the
other hand the Project Management Institute states (PMBOK, 2004) that a project is a
temporary endeavour undertaken to create a unique product, service, or result. While
according to PRINCE2 (2002) project is a management environment that is created for the
purpose of delivering one or more business products according to a specified Business Case.
Those main definitions presented by leading organizations in project management agree
that project should have a purpose and is limited by time, budget, resources and
specifications.
2. Project Portfolio
Consequently, the project portfolio can be defined. Before that, it is important to clarify
what kind of projects should be taken into consideration when creating the project
portfolio. Wysocki (2003) deliberates whether simple task to one person could be a complex
project for others. For example buying the laptop, for those who does not have computer
knowledge it will be difficult task and becomes a project. Therefore, it is important that
organization distinguish operational tasks from projects (McGary, 2003). Once that is set,
the simple definition can be introduced stating that a project portfolio is a collection of
projects that share some common link to one another. The statement of common link means
for example that all the projects aim to help local community develop or aim to develop

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new product. On the other hand, Miguel (2008) findings about project portfolio state that
the concept evaluated from project selection (Baker, 1974) to prioritization of product
development (Cooper et al., 2000) and to the current understanding as multiple project
management (Dooley et al. 2005). Additionally Cooper (1997) argues that in project
portfolio the new project can be introduced, while existing can be withdrawn, cancelled or
suspended. This statement shows that project portfolio is not set for a given period of time,
but changes constantly, adjusting to the current situation and objectives of the company,
representing great flexibility if properly managed.
2.1.Project Portfolio Management
This statement leads to another concept, which is project portfolio management. According
to Bridges (2003) there is an art of project portfolio management (PPM), which involves
scrutinizing each potential project, selecting the right mix of projects, and adjusting as time
passes and circumstances unfold. Additionally Cooper (1997) argues that portfolio
management is a process in which projects for the development of products or services are
continually evaluated, selected and prioritized; new projects may be introduced and existing
projects might be suspended, cancelled, or de-prioritized. Hunt (2008) adds that project
portfolio management is a decision process that oversees the resource allocation and
ongoing decisions related to a strategically oriented portfolio of projects. In overall, the most
definition that collects the best parts of mentioned definitions and thoughts on project
portfolio has been developed by Wysocki and McGary (2003) and states that Project
portfolio management includes establishing the investment strategy of the portfolio,
determining what types of projects can be incorporated in the portfolio, evaluating and
prioritizing proposed projects, constructing a balanced portfolio that will achieve the
investment objectives, monitoring the performance of the portfolio, and adjusting the
contents of the portfolio in order to achieve the desired results. Consequently, when

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speaking about project portfolio in further stages of this study the reference to this final
definition will be made.
The decisions made regarding project portfolio must take into consideration the strategic
approach, as well as operational. This means that project that does not correspond to the
mission and objectives of the organization should not be included in portfolio. According to
Miguel (2008) if the projects do not correspond with the business strategy and capabilities,
there is a risk that projects will be delivered with poor quality. On the other hand, there
might be increase of resources to focus on the project that is not consistent with others,
resulting in decreasing the quality of remaining projects. Hence, according to Cooper (1997)
the project portfolio management should lead to acquisition of only those projects, which
will maximize the value, balance and strategic position of the company.
2.2.Balanced Portfolio
Cooper (1997) declared that organization should aim to maximize the balance of the
projects within the portfolio, as it will help to manage them effectively. Miguel (2008)
agrees stating that balanced portfolio in place should be a strategic objective as it is
important to have different types of the projects.

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Graph 2. Bubble diagram of a portfolio of new-product projects (Source: Cooper et al.
1997, p.24)
The above graph introduced by Cooper (1997) shows projects within the portfolio in any
company. There are projects that guarantee high rewards with high probability of success,
at the same time there are more risky projects. This is the great example of balanced
portfolio, where there are certain projects that guarantee success, and those can back up
those more risky.
McGary (2003) argues that it is neither an easy task to build the balanced project portfolio
nor there is a successful approach. Kendall (2003) argues that there must be correct mix of
projects balancing the supply side of organization with its market side. Such balance ensures
that company does not have any decline in revenues. Additionally, Bridges (2003) believes
that if portfolio is balanced effectively, this will ensure optimum use of resources and
people.

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Consequently, it is important to create the project portfolio that is balanced. Also, the
projects undertaken should follow the strategy and objectives of the organization, exploiting
its resources efficiently and effectively.
2.3.Operating a Project Portfolio
The project portfolio does not exist when an organization has few projects and manages
them at the same time. There is a procedure, sequence when building project portfolio.
McGary (2003) is convincing that there are five phases of project portfolio management.
Those include (1) Establishment, (2) Evaluation, (3) Prioritization, (4) Selection, (5)
Management. At the same time Bridges (2003) says about three steps (1) Focus, Strategic
Planning (2) Selection, Portfolio Management, (3) Management, Project Management. This
is illustrated on the following graph.
Graph 3. Project Portfolio Management (Source: Bridges, 2003)
Rad and Levin (2006) also agree that PPM goes through stages of development, which
according to them are as follows: (1) identification of enterprise opportunities, (2) selection
of projects to fulfil those opportunities, (3) planning and executing those projects, (4)
continually assessing the benefits of these projects to the organizational success.

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The most detailed approach regarding development of project portfolio has been evaluated
by Wysocki and McGary (2003). Therefore, their five phases will be evaluated in more detail,
compromising opinions of other authors regarding relevant steps.
2.3.1. Establishing Portfolio Strategy
According to Wysocki (2003) the first step of building project portfolio is establishing its
strategy. Bridges (2003) adds that it is essential the portfolio’s strategy is aligned with the
organization mission and objectives. On the other hand Rad and Levin (2006) that
opportunities for the company should be firstly evaluated, before deciding on the strategy.
Wysocki (2003) agrees with those statements, stating that project proposals are investment
opportunities that should be evaluated and categorized before they are acquired into
portfolio. According to McGary (2003) there are several models that can be adapted to help
managers in this task, which include:
 Strategic Alignment Model
 Boston Consulting Group Products/Services Matrix
 Project Distribution Matrix
 Growth versus Survival Model
 Project Investment Categories
2.3.2. Evaluating Project Alignment to the Portfolio Strategy
This stage, according to Wysocki (2003) should focus on defining whether the proposed
project is in the alignment of portfolio strategy and to which category it belongs. This is
made through one of the models chosen from the list from previous section. Rajagopal
(2007) argues that the company should fund only those projects, which mostly align with
company’s strategic objectives. Blichfeldt (2007) adds that the projects should be screened

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against created criteria and classified appropriately. Once the projects are categorized the
next phase can begin (McGary, 2003).
2.3.3. Prioritizing and selecting Projects
Wysocki (2003) states that the first tactical step in every portfolio management model
involves prioritizing the projects that have been shown to be aligned with the portfolio
strategy. Rajagopal (2007) follows with statement that business attaches valuation criteria
to rank projects in terms of their importance. There are many approaches to prioritize
projects in their categories. Bridges (2003) gives examples of criteria that can be identified:
benefits to the company, costs and risks. On the other hand Wysocki and McGary (2003)
introduce models that can help to prioritize and select projects in portfolio in the simple
way, those include:
 Forced Ranking
 Q-Sort
 Must-Haves, Should-Haves, Nice-to-Haves
 Criteria Weighting
 Paired Comparisons
 Risk/Benefit
 Multi-Criteria Decision Methods
The selection method and process will be described in the 3rd
section of this chapter
in greater detail as this part is the highest interest of the research.

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2.3.4. Selecting Balanced Portfolio Using the Prioritized
Projects
The next phase aims to create a balanced portfolio of projects. According to Wysocki (2003)
it is very challenging task for the management team as it involves ranking projects from
most valuable to least valuable. Additionally, it requires choosing those that fit the strategy
and can be performed accordingly to available resources. This stage of building the project
portfolio is the most crucial, as projects acquired will be run by the organization utilizing its
resources throughout the planned period of time.
Wysocki (2003) examined about 30 different methods that could be used in selection of the
projects into portfolio. The main three outlined by him include:
 Strategic Alignment Model and Weighted Criteria
 Project Distribution Matrix and Forced Ranking
 Graham-Englund Selection Model with the Project Investment Categories
and the Risk/Benefit Matrix
However, Bridges (2003) argues that the company should prepare the list of criteria, which
should be given importance, and then projects should be compared in pairs against them.
The most common method for this kind of project selection is Analytical Hierarchy Process
(AHP) method. Which will be a main method used in the research and evaluation. Therefore,
the detailed analysis and explanation will be performed.
2.3.5. Managing the Active Projects
Final phase of portfolio management is actual management of the projects that were
accepted. Wysocki (2003) states that in this phase, each project should be monitored to
check its performance against the plans outlined. Rajagopal (2007) adds that the portfolio
should be constantly reviewed, some businesses introduce centralized Programme

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Management Office (PMO) which gathers financial and work progress perspective updates
from project leaders. This information and reports are passed to senior staff and
stakeholders.
2.3.6. Summary of project portfolio development
According to Bridges (2003) an organization may have the best ideas and methods, but if the
process is not structured or implemented correctly, the company will have a hard time
gaining widespread acceptance of the new process. Therefore, it has to be implemented to
fit other processes and culture of the company. Accordingly, the introduction of process of
project portfolio may differ from company to company, and it’s up to management team to
choose the most suitable option.
2.4.Project life cycle
In the previous section the path of project has to go through to be accepted into the project
portfolio. It is time to have a closer look on the project life cycle on its own and then in the
portfolio itself.
PRINE2 (2002) states that a project has a life cycle, which is the path and sequence through
the various activities which produce the final product (Graph below).
Graph 4. Project Life Cycle (Source: PRINCE2, 2002)

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On the other hand, PMBOK (2004) states that the project life cycle defines the phases that
connect the beginning of a project to its end (Graph below).
Graph 5. Project Life Cycle (Source: PMBOK, 2004)
At the same time Gray (2002) shows expanded model of the project life cycle with
explanations what happens in each of the stages defined (Graph below).
Graph 6. Project Life Cycle (Source: Gray, 2002)

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In overall, those models present that project that is going through various stages. In each of
them there are different tasks performed leading to increase activity of project members.
All this models show that the project has defined starting and ending point (Gray, 2002).
However, according to Wysocki (2003) the project in portfolio has its own life cycle, which is
illustrated on the graph below.
Graph 7. Portfolio project life cycle
According to this model there are eight stages the projects go through in the process of
creating the project portfolio development which have got to be completed in order to
create the successful portfolio.
2.5.Benefits of project portfolio
There are many benefits when the organization decided to introduce project portfolio
management. Bridges (2003) states that benefits are tremendous, for example the value of
SmithKleineBeecham portfolio increased by 30 percent after introduction of presented
approach. These benefits presented by Bridges (2003), Rajagopal (2007), Rad (2006) include:

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 Having a structure in place to select the right projects and immediately remove the
wrong projects;
 Placing resources where they're needed and reducing wasteful spending, better
utilization of resources
 Linking portfolio decisions to strategic direction and business goals; tighter
alignment with organizational objectives
 Establishing logic, reasoning, and a sense of fairness to portfolio decisions;
 Establishing ownership among the staff by involvement at the right levels;
 Providing avenues for individuals to identify opportunities and obtain support;
 Helping project teams understand the value of their contributions.
2.6.Problems
Although there are many benefits of having a project portfolio management in the
organization, there are problems that might occur. Those problems are challenges for
portfolio managers and include, according to Kendall (2003):
 Too many active projects (often double what an organization should have)
 Wrong projects (projects that will not provide value to the organization)
 Projects not linked to strategic goals
 Unbalanced portfolio [e.g. Too much on the supply side, not enough on the market
side; or Too much short term and not enough long term, etc.]
Accordingly, the research will focus on finding the best practices to avoid those problems
when implementing project portfolio and while managing it.

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3. Project Selection methods
As revealed by the President of SIFE Salford (studied organization) there is no structured
selection method of the projects which are undertaken by the organization. All the decisions
are made by the management committee based on the little information from external
organization and without specific evaluation. It is made through democratic voting without
justification of decisions.
This dissertation through the research undertaken aims to present available methods
commonly used in various industries for selecting methods. Further the assessment of the
methods and analysis by experts will reveal which of the chosen one is more accurate and
suitable for studied organization.
Two methods have been selected for the comparison and study. First one is called Criteria
Weighting (Wysocki, 2003; Heldman 2007), while second is Analytical Hierarchy Process
(Saaty, 2001). These will be now described and analysed along their application.
Importance of selection methods
According to Marzouk (2008) there is a need for structured selection of the project as it
helps to avoid common problems that occur with projects such as cost and schedule
overruns, reducing quality and safety measures, claims and litigation. Further, the
capabilities of the partners need to be examined and various criteria need to be evaluated
(Hatush and Skitmore, 1998). According to those authors common mistake is choosing a
project with biggest budget, which is just one criterion, while there should be other taken
into consideration as decisions are complex. Even though, Mahdi (2002, p.29) argues that
the selection method should be simple, normally accurate and transparent so that the
reason why the project have been chosen is clear and reasonable. Rad (2006) states that to
achieve successful project portfolio management the methodical selection of projects
approach needs to be implemented (Graph below).

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Graph 8. Process of managing portfolios successfully (Rad, 2006, p.127)
Difficulty of selecting a project
Graves (2002) outlines that manager or organization has a great difficulty in selecting a
project from a menu of opportunities. Their choice is limited by available resources, for
example capital, talent, time. Further, Graves (2002, p.1) adds that the choice has got to be
aligned with the strategy to satisfy corporate goals or objectives. Often these are multiple
making it even harder to decide without applied, structured approach for selection. Further,
Levine (2005) states that managers often know only few aspects of the projects or
organization strategy, and make their decision based only on that without taking into
consideration other criteria. Also, the situation in the organization is complex and
availability of resources varies which also commonly is not taken into consideration (Levine,
2005). This illustrates that without appropriate process of selecting a project to the project
portfolio the inappropriate project can be selected, which could lead to great difficulties.
The approach has got to be systematic and allow clear, transparent choice.
3.1. Criteria weighting method
Wysocki (2003) introduces the criteria weighting method as the one that can be used for
prioritizing and selecting projects into project portfolio. Following, he states that there are
many models built by various authors, which apply the same scheme and approach.

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Heldman (2007) outlines that a criteria weighting method lays within scoring models
section. Furthermore, these methods and models belong to category defined by Project
Management Institute (PMI) defined as benefit measurement. According to Heldman (2007)
methods in this category apply various forms of analysis and comparative approaches to
make project decisions. The other category outlined by PMI is mathematical methods, which
contains very complicated algorithms and formulas, which can be applied for very complex
projects.
Therefore, for simple project selection in the social enterprise the scoring model or criteria
weighting method can be applied more easily. Rad (2006, p.32) states that appropriately
applied scoring model consists of four components:
 Categories of criteria to determine the model type
 Range of values for the criteria
 Measurement and description for each value within the range
 Importance or weight of the criteria
Firstly, Heldman (2007) advises that commonly the project committee decides on the
criteria that will be taken into consideration and scored against. For the analysis of the case
study the survey will be performed to outline the most important criteria in social enterprise
(Methodology Chapter). Rad (2006) argues that selected criteria should be objective, that
people cannot skew the model to select pet projects (Armstrong, 2004).
There is a wide range of available criteria that can be taken into consideration when
selecting projects. Cooper (2001) outlines criteria such as strategic attractiveness,
product/competitive advantage, market attractiveness, synergies in terms of leveraging core
competences, technical feasibility and risk versus return. Martino (2003) adds costs, payoff,
market share, probability of success, the availability of resources, degree of competition,

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constraints. Cleland (2003) focuses on criteria such as risk, profit margin and duration. For
the purpose of the research the criteria have been chosen to fit the case of social enterprise
(Methodology chapter).
In the next step of the method, according to Wysocki (2003) experts should agree on the
weight of each criterion scoring them from 1 – 10 or 1 – 5. Heldman (2007) follows stating
that highest score represent higher importance than lower scored criteria. According to Rad
(2006) such assessment will show which criteria can be scored objectively and which will
require some more judgments to be made. Martino (2003, p.32) argues that if one or more
criteria are compromised of sub-criteria that are combined to obtain the value for a factor,
any combination must be done outside of the specific model.
Once the criteria are weighted, the experts can score a project against agreed criteria using
the same scale an approach as step before.
An example of such scoring is presented in the table below.
Criteria Weight Project
A Score
Project
A Totals
Project
B Score
Project
B Totals
Project
C Score
Project
C Totals
Profit potential 5 5 25 5 25 3 15
Marketability 3 4 12 3 9 4 12
Ease to
produce/support
1 4 4 3 3 2 2
Weighted score 41 37 29
Table 1. Scoring method (own study based on Heldman, 2007, p.64)
In the example from Heldman (2007) it can be seen that project A is an obvious score due to
highest score.

23
According to Cooper (2001) thescores given by projects become a proxy for the value of the
project. However, it includes strategic, leverage, and other considerations rather than solely
financial measures (Rad, 2006, p.33). Consequently, Meredith (2006) suggests use of scoring
models as they include multiple objectives and criteria, which is crucial in decision making
process. However, Meredith (2006) would add constraints to the model to reflect the real
situation of the project.
In summary, the criteria weighting method is commonly used by many researchers and
authors. Models have different variances according to the specific case or application.
Nevertheless, they are based on the same decision process, which is widely applied in the
industry.
Limitations
Rad (2006, p.33) states that although scoring models are easy to use, they are not precise.
Therefore, the results should be only treated as guidelines bearing in mind that people
should make decisions not models. Meredith (2006) adds that experts are forced to make
difficult decisions based on limited information and analysis. Further, the U.S. Government
Office (GAO) argues about the importance of defining the scoring elements. Each score
should have description of what it actually represents. Experts often face only numbers on
the scale without understanding of the meaning, such exercise are meaningless. Therefore,
the correct approach should be implemented allowing experts to understand purpose and
meaning of the method. Warrall (2000) states that there might occur difficulties with
expressing the judgments based only on numerical scale or if decisions and scoring are
made during discussion. In such situation the experts might be afraid to express their actual
judgments due to certain circumstances (i.e. presence of senior management). Therefore, it
is important to build functional atmosphere for applying the method.

24
3.2.Analytical Hierarchy Process method
Multi-criteria decision making
According to Al-Harbi (1999, p.19) project, portfolio and organization managers are faced
with complex decisions in intricate environments. The elements of the problems are
numerous, and the inter-relationships among the elements are extremely complicated. The
decisions need to be made, taking into consideration all the factors, influences and
constraints. Schuyler (1999) argues that many managers are lacking skills that allow sound
decisions, therefore there is a need to implement the decision making approach.
Triantaphyllou (2000) states that the way people make decisions (prescriptive theories) or
the way people ought to make decisions (normative theories) has been a subject to many
research papers for years. Consequently, many methods and theories have been developed
over years. One of the major branches in decision making is Multi-Criteria Decision Making
(MCDM). According to Triantaphyllou (2000, p.1) MCDM concentrate on problems with
discrete decision spaces, which means that the set of decisions alternatives has been
predetermined. Although, there are many MCDM methods, they have certain aspects in
common which are explained below:
 Alternatives – different choices of action available to decision maker, which should
be screened, prioritized or/and ranked
 Multiple attributes – attributes represent the different dimensions from which
alternatives can be viewed. In complex projects or decisions, the attributes and
criteria can be structured in hierarchical manner, showing the importance, value
against each other.
 Conflict among criteria - i.e. profit and cost
 Incommensurable units – when criteria are expressed by different units of
measurement but still have to be compared

25
 Decision Weights – the criteria are given weights representing their importance
 Decision Matrix – each problem analysed by MCDM can be illustrated on the matrix
showing criteria, weights and alternatives
According to Al-Harbi (1999) and other authors, the aim of MCDM methods is to help
decision-makers learn about the problems they face, to learn about their own and other
parties' personal value systems, to learn about organizational values and objectives, and
through exploring these in the context of the problem to guide them in identifying a
preferred course of action. According to Hwang and Yoon (1981) research on MCDM
methods, which have application in project management revealed that they are mostly used
for evaluation of problems and design of problems. Therefore, the analyzed case study in
this dissertation has a problem of choosing the appropriate selection method for the
studied social enterprise.
Application
Among number of MCDM methods available the Analytic Hierarchy Process (AHP) method
has been chosen by the author. According to Al-Harbi (1999), Harker and Vargas (1987),
Perez (1995) the method is viable and widely used by governmental agencies, corporations
and consulting firms. Moreover, there are a lot of applications for this method across
industries showing that method is popular and works, efficiently allowing making sound
decisions. Below there is a list of authors who used AHP method for their own research
studies and cases, which show a great variety of applications.
Authors (Year of publication) Application of AHP method
Wu, W., Lee, Y. (2007) Selecting knowledge management strategies
Mahdi, I.M., Riley, M. J., Fereif, S.M., Alex,
P.A. (2002)
Contractor selection

26
Marzouk, M. (2008) Contractor selection
Hatush, Z. and Skitmore, M. (1998) Contractor selection
Mota, C. M. M., Almeida, A. T., Alencar, L. H.
(2009)
Assigning priorities to activities in project
management
Milis, K., Mercken, R. (2004) The evaluation of Information and
Communication Technology projects
Lin, M., Wang, C., Chen, M., Chang, C. A.
(2008)
Customer-driven product design process
Lee, A. H. I., Chen, W., Chang, C. (2008) Evaluation of performance of IT department
in the manufacturing industry in Taiwan
Huang, Y., Bian, L. (2009) Personalized recommendations for tourist
attractions over Internet
Ertugrul, I., Karakasoglu, N. (2009) Performance evaluation of Turkish cement
firms
Chin, K., Xu, D., Yang, J., Lam, J.P. (2008) Product project screening
Cheng, S., Chen, M., Chang, H., Chou, T.
(2007)
Semantic-based facial expression recognition
Celik, M., Er, I. D., Ozok, A. F. (2009) Shipping registry selection: The case of
Turkish maritime industry
Carlucci, D., Schiuma, G. (2007) Knowledge assets value creation map,
Assessing knowledge assets value drivers
The above table shows that the AHP method is widely used in various industries, therefore
the author decided to illustrate application of it to the studied social enterprise.

27
The Analytic Hierarchy Process
The method s has been developed by Saaty (1980; 1994; 2001), therefore it is essential to
understand the process of the author. Consequently, there are three principles of analytic
thought that underlie the AHP which are: constructing hierarchies, establishing priorities
and logical consistency.
Structuring (Construction) hierarchies. Saaty (2001) states that human mind structures
complex reality into parts, which consist of parts and so on building a hierarchy. Breaking a
problem or a case down to detailed structures allows getting a more complete picture. In
some cases it can have up to nine levels if the problem is complex or decision very
important.
Setting priorities. According to Saaty (2001, p.17) humans have the ability to perceive
relationships among the things they observe, to compare pairs of similar things against
certain criteria and to discriminate between both members of a pair by judging the intensity
of their preference for one over the other. Consequently, Saaty (2001) argues that judgments
can be synthesized through imagination or with AHP, the new logical process, which allows
gaining understanding of the whole system.
Logical consistency. Final principle of AHP method comes from Saaty’s research (2001)
revealing that humans the ability to establish relationships among objects or ideas in such a
way that they are coherent. This means that judgments relate to each other exhibiting
consistency, which means two things. Firstly, the ideas or objects are grouped according to
homogeneity and relevance. Secondly, the intensities of relations among ideas or objects
based on a particular criterion justify each other in some logical way.

28
Principles in AHP Process
Saaty’s AHP method (2001) utilizes these principles in AHP process incorporating both the
qualitative and the quantitative aspects of human thought: the qualitative to define the
problem and it hierarchy and the quantitative to express judgements and preferences
concisely. The AHP process integrates those two approaches which allow making sound
decisions.
AHP Steps
Al-Harbi (1999) summarized steps of Saaty’s AHP method:

29
The Analytic Hierarchy Process is a complicated mathematical method, which helps a lot
with decision making. However, if there was no software that allows user-friendly
application of it, very few people would use it. The Expert Choice software has been
designed, which hides the complicated mathematical calculations and algorithms under
user-friendly screens which allow fast decision making and analysis of the results
(ExpertChoice.Com, 2009). The process will be explained in detail in methodology chapter.

30
Advantages of AHP
Graph 9. Advantages of the Analytic Hierarchy Process (own study based on Saaty, 2001, p.25)
AHP
Unity: The AHP provides a single,
easily understood, flexible model
for a wide range of unstructured
problems
Complexity: The AHP
integrates deductive
and systems approaches
in solving complex
problems
Interdependence: The
AHP can deal with the
interdependence of
elements in a system
and does not insist on
linear thinking
Measurement: The AHP
provides a scale for
measuring intangibles
and a method for
establishing priorities
Consistency: The AHP
tracks the logical
consistency of
judgments used in
determining priorities
Synthesis: The AHP
leads to an overall
estimate of the
desirability of each
alternative
Tradeoffs: The AHP takes
into consideration the
relative priorities of factors
in a system and enables
people to select the best
alternative based on their
goals
Judgment and consensus:
The AHP does nor insist on
consensus but synthesizes a
representative outcome
from diverse judgement
Process Repetition: The AHP
enables people to refine
their definition of a problem
and to improve their
judgment and understanding
through repetition

31
Other authors also recognize other advantages of AHP method. Al-Harbi (199) states that AHP allows
consideration of multi-criteria as well as group decision-making. Also, other authors who found
application of AHP very useful (table above) appraise the use of software for this method.
Critique of AHP
Although the AHP method has many applications in various industries and is widely used there are
still some critiques of it. Watson and Freeling (1987) argued that in order to elicit the weights of the
criteria by means of a ratio scale, the method asks decision-makers meaningless questions, for
example: `Which of these two criteria is more important for the goal? By how much?' According to
authors it is not constructive. Moreover, Belton and Gear (1983) and Dyer (1999) pointed out that
this method can suffer from rank reversal (an alternative chosen as the best over a set of X, is not
chosen when some alternative, perhaps an unimportant one, is excluded from X). Further, Cheng et
al. (2007) stated that AHP is rigid and inflexible making it hard to use in fast moving projects.
Further, Barzilai (1998) examined the AHP method and concluded through various case studies that
shows that application of AHP leads to wrong results.
These criticisms have been tackled by various authors, who analysed the problems and presented
answers. The most accurate response had been presented by Whitaker (2007) who examined the
cases brought up by mentioned authors. From her research it came obvious that critiques have not
applied AHP method appropriately and missed fundamental steps in AHP process such as
establishing priorities for criteria. Consequently, Whitaker (2007) defended the AHP method by
revealing wrong approaches taken by the critiques.
Ethical Considerations
Saaty (2001, p.11) argues that because of complexity of decision making process, the expert
responsible for judgments regarding social issues should have following characteristics to be able to
make ethical decisions:

32
 Truthfulness by not oversimplifying complexity
 Justice by evaluating costs and benefits and assigning costs to those who get the benefits
 Ability to plan for the unknown by calculating changes, determining where they are likely to
occur, and deciding which priorities should dictate action
 Flexibility in adapting to change by planning, implementing, and, in response to new
conditions, re-planning and re-implementing.
Summary of AHP
According to Forman (2001, p.43) the AHP developed at the Wharton School of Business by Thomas
Saaty, allows decision makers to model a complex problem in a hierarchical structure showing the
relationships of the goal, objectives (criteria), sub-objectives and alternatives. Bhuschan (2004)
outlines important aspect of AHP, which allows group decisions through brainstorming, meetings or
open discussions. The Expert Choice software based on the methods allows assessments by
individual experts which then can be combined to produce overall result. The AHP has found many
applications, because it makes experts compare criteria and alternatives in pairs, which allows them
to oversee the problem and understand the structure and reasoning of the studied situation.

33
III. Chapter: Methodology
As an academic activity, the research should be conducted in a systematic, organised and planned
manner (Kothari, 2005). Therefore, this chapter introduces the methodology of the author’s research
and aims to present its methods and procedures.
Firstly the reasoning of the research will be discussed. According to Crotty (1999) every research
consists of four elements as shown on the graph below.
Graph 10. Four elements of research (Crotty, 1998, p.4)
Each of these elements has been described by Crotty (1998, p.2):
 Epistemology: the theory of knowledge embedded in the theoretical perspective and
thereby in the methodology
 Theoretical perspective: the philosophical stance informing the methodology and thus
providing a context for the process and grounding its logic criteria
 Methodology: the strategy, plan of action, process or design lying behing the choice and use
of particulat methods and linking the choice and use of methods to the desired outcomes

34
 Methods: the techniques or procedures used to gather and analyse data related to some
research question or hypothesis
Kumar (2005) states that research is the way of thinking, critically examining the various options and
aspects of world from perspective of i.e. customer, professional, institutions or businesses.
Accordingly, the research is one of the ways to finding answer to the questions (Kumar, 2005, p.6).
Kumar (2005, p.6) argues that the researcher philosophical orientation may steem from one of the
several paradigms and approaches in research – positivist, interpretive, phenomenolist, action or
participatory, feminist, qualitative, quantiatative – and the academic disciplin in which researcher
have been trained.
Nevertheless, authors (Kumar, 2005, Crotty, 1998, Malhotra, 2007) agree that the research should be
valid, reliable and unbiased. The first concept assures that correct procedures and approaches have
been chosen and applied in research. Reliability ensures the quality of research methods, data
collection and analysis which will provide accurate results. Finally, unbiased refers to objective
approach of researcher who will not introduce personal statements and influences at any of the
stage of research and remind unbiased. Kumar (2005) states that fulfilling these three criteria allows
to call the process a research.
Types of research
Kumar (2005) and other authors identify types of research as presented on the graph below:

35
Graph 11. Types of research (Source: Kumar, 2005, p.9)
The three classifications are not mutually exclusive (Kumar, 2005, p.8). Application approach aims to
examine the methods, techniques or procedures that can be further applied in real life situations to
improve existing systems or to introduce new solutions. As it is the aim of this research, where
project selection methods are studied and researched to be later introduced to the social enterprise
for further implementation.
Furthermore, the objective approach aims to describe a situation or problem (descriptive research),
to discover relationship/association between two or more aspects of situation (correlation research),
to clarify why and how there is a relation between aspects of situation (explanatory research), to
explore the area of study whether it is worth researching (exploratory research) (Kumar, 2005).
Finally, inquiry mode approach considers processes which will be undertaken to find answers to the
questions. Accordingly, there are two aspects: the structured and unstructured. First is connected
with qualitative research, where everything (scope, objectives, structures) are predefined, which
allows to analyse the extent of the problem. On the other hand, unstructured approach is classified

36
as a qualitative research, which allows greater flexibility than quantitative. Therefore it is mostly used
to investigate the nature of the problem (Kumar, 2005).
In summary, the research is a complex task that has to have the reason behind to undertake it.
Further it has to be examined whether someone before carried out similar research. Then the
advantages of such process should be outlined whether they will be theoretical or practical and who
will benefit from this. Finally, once the research has been approved to be undertaken the research
methodology and methods has got to be examined and decided for the given case.
This leads to analysis of secondary and primary research.
1. Secondary research
The secondary data, gathered in previous researches for some other purposes, has numerous of uses
in the author’s research, including: helping to answer the research questions, getting the background
and understanding of the overall problem situation (Wrenn, et al, 2006). Two different sources of the
secondary data can be highlighted here: internal and external sources. While the first one can be
found within the organization for which the research is provided (social enterprise – SIFE Salford),
the external data is more difficult to obtain and has forms, such as online material, databases, etc.
(Malhotra, 2007).

37
Graph 12. A classification of secondary data (own study based on Malhotra, 2007, p.100)
The collection and analysis of secondary data can help to define research problem and develop an
approach to solve it (Malhotra, 2007). Secondary data can help with diagnosis of the research
problem, development of an approach to solve it as well as to create sampling plan. Further, it helps
with answering certain questions and testing hypotheses. Finally, it allows to validation of research
findings, through comparison with results of other authors (Malhotra, 2007, p.96).
However, secondary data has some disadvantages. Firstly, data was collected for other purposes
than research undertaken. Therefore, they might be irrelevant or inaccurate for the studied case.
Following, the data analysed may not be current or reliable (Malhotra, 2007, p.96). Therefore,
Malhotra (2007) advises to evaluate secondary data before discussing it.
2. Primary research
As the search for the research answers may also go beyond the study of the existing secondary data,
it is vital for the researcher to address the research problem personally. The primary research
Secondary data
internal
Ready to use
Requires further
processing
external
Published
materials
Computerised
databases
Syndicated
services

38
approach needs to be implemented in such case and it requires the researcher to justify his or her
reasons for choosing a particular method of data collecting (Wrenn, et al, 2006).
Therefore, after analysing the possible types and methods of conducting the study, the researcher
finds it applicable to utilise the qualitative research. This type is concerned with the qualitative
phenomena and aims to explore it. On the other hand, quantitative research typically seeks to
measure the quantity or a certain amount of the phenomena (Kothari, 2005).
As the qualitative research takes place in the natural setting, in order to ensure comfortable situation
for the participants taking part in it (Creswell, 2003), the researcher aims to create such settings, as
well as the use of various interactive methods is planned to be used. The purpose of that is to build
credibility of the participants and encourage them to actively take part in the research (Creswell,
2003).
The researcher’s primary aim, while conducting qualitative research, is to understand the underlying
motivations and processes, as well as objectives of the study (Malhotra and Birks, 2007).
Primary research plan and strategy
To address the research objectives and produce the results that can be analysed for further
recommendations, the research undertaken needs to have a structure and plan.
In the first stage the survey will be commenced to identify key criteria for project selection. Then
results from the survey, top 5 criteria chosen by surveyed people will be used to form the
questionnaire.
In the second stage research participants will be interviewed. They will be asked to choose one
project that should be implemented by the studied organization. This decision will be made solely by
comparing project description (prepared to the 5 criteria derived from survey). The participants will
be asked to justify their decision and answer supportive questions

39
In the third stage experts will be asked to assess and choose the projects once again, but using Expert
Choice software this time.
The results from the research will be further analysed in the next chapter. Below, the detailed
presentation of each method and approach will be discussed.
Stage 1: Survey
Objective
The first stage of the research addresses the first objective of the dissertation, which asks to outline
the most important and adequate criteria for the process of project selection into project portfolio.
The most suitable research method to achieve this has been the survey due to rapid turnaround of
data collection and economy of design (Creswell, 2003, p.154).
According to Creswell (2003, p.153) a survey provides a quantitative or numeric description of trends,
attitudes, or opinions of a population by studying the sample of that population. Fowler (2002, p.2)
follows that by stating that research aim is to gain subjective feelings of the public regarding the
asked issue.
Target audience – Sample
Creswell (2006) states any survey has got to have target group which will participate in research.
They have to be chosen accordingly to their knowledge and expertise about the researched topic. For
the purpose of this questionnaire four target groups has been identified, which are as follows:
Project Managers, Volunteering & Community Organizations Managers, Management Committee of
SIFE Salford (student society which case is being studied), experienced employees who work on
projects. From each of these groups three people had been asked to fill in the survey, which led to
collecting twelve responses.

40
Design of the survey
The objective of the survey was to identify the most important criteria for project selection. To
create the list of criteria from which the surveyed could choose from, the primary research has been
performed. Levine (2007), Gray and Larson (2002), Westerveld (2003), Stewart and Mohamed (2002),
Visitacion (2006) have identified criteria in their research and those suitable to the case study (social
enterprise) has been chosen.
Data collection
People surveyed have been asked to chose five criteria from the list and rank them according to their
significance from the most to least important. Each of the answer has different value as presented in
a table below. This will allow creating a ranking of criteria based on the average score. The top five
criteria will be chosen for the next stage of research.
Significance Value
the most important 5
Second important 4
Third important 3
Fourth important 2
The least important 1
Table 2. Explanation of rating answers
The survey has been designed using an online survey tool from SurveyMonkey.com Company. It is
free and very advanced tool for research methods. The designed survey (Appendix 1) has been sent
by email to 12 chosen participants (Appendix 1). Further they answered one question by ranking five
criteria of their choice. The data was collected in the system which helps to analyse it further in the
next chapter.

41
Limitations
Saunders (2007, p.531) states that any research has its limitations such as the size of the sample and
the snapshot nature of the research. Further, criteria identified by authors such as Levine (2007) led
to creating the list; however there might be other criteria which have not been identified.
Additionally, Bickman (1997) and Saunders (2007) state that the language and wording of research
questions and answers has got to be understandable for surveyed people. Because they may
represent different industries there is a risk of misunderstanding o use of different definitions.
Stage 2: Interview
The interview can be described as a conversation conducted in a planned and unstructured manner
that is conducted by the researcher who possesses an underlying purpose (Gillham, 2000). During
the research a series of questions from the researcher to the participant (interviewee) is asked with
the aim for the researcher to listen, analyse and then interpret the material gathered from the
answers (Malhotra and Birks, 2007).
Conducting an interview is one of the most common methods used in qualitative research, mainly
due to its characteristic of being a flexible, open and direct of collecting the primary data. Through
the way of unstructured conversation the researcher can also collect more additional, background
information that will help him or her to understand the ‘broader picture’ of the research problem.
Malhotra and Birks (2007) summarize that by saying that “in-depth interviewing seeks ‘deep’
information and understanding”.
Objective
The aim of the interview is to gain understanding of decision making process, reasons behind it when
selecting project into project portfolio. Additionally, interview aims to research the usefulness and
appropriateness of the presented method in opinion of different target groups. The opinions
regarding the method will be gathered for further analysis and comparison.

42
Design of interview
Participants will be shown the first method of assessing the projects by comparing project
descriptions (Appendix 2) of three anonymous projects from various organizations. Based on them
experts will be asked to choose one project that should be accepted to the project portfolio.
Further, they will be asked to justify their choice and answer additional questions that will support
their answer and discussion if necessary (Appendix 3). Because they will be assessing projects to be
implemented by the studied organization - SIFE Salford, the will be given short description about this
particular social enterprises, its capabilities and general idea behind (Appendix 4).
The representatives from four identified groups: Project Managers, Volunteering & Community
Organizations Managers, Management Committee of SIFE Salford, experienced employees, who
work on projects, will be asked to participate in one-on-one interviews. The expertise and knowledge
of the interviewed people, along with their different perspectives on the studied issue will reveal
interesting results and findings, which will lead to recommendations for studied organization.
Data collection
The researcher will provided project descriptions for the interviewed person with a field for
comments. There will be time provided for analysis of the data presented and then the interview will
be performed with support of the questions prepared to lead the discussion.
Limitations
Understandably, a number of constraints may occur during the research, with the major one related
to the time scale of the study that is expected to be planned, designed, conducted and analysed in
only few months only by the researcher himself. Additionally, the researcher, not being a
professional in the field of research, may experience this as a difficulty. Limitations connected with
the interview method include, i.e.: the lack of sufficient responses, participants’ aversion, and
difficulty of the questions asked.

43
Stage 3: Expert Choice assessment
Objective
The aim of this assessment is to show alternative method for selecting the project, which widely used
in the various industries across the globe, the Analytical Hierarchy Process (AHP) method.
It has been discussed in the literature review and its applications were outlined. It is very complex
mathematical method, therefore to make it more accessible the Expert Choice software has been
used to allow simple on-screen decisions, while the program calculates everything on its own. For the
purpose of the research the Expert Choice 2nd
Education Edition will be used, the Expert Choice Inc
allows discussion over terms and conditions of use of their software and could allow free use for
social enterprise.
Secondly the experts will be able to assess the method and compare it with the previous one
outlined in the stage 2 of the research. The aim is to get opinion from the experts about usefulness
and appropriateness of the methods for the social enterprise, and which of the methods can be more
beneficial for the studied organization.
Design of the assessment
The special file in the Expert Choice software has been designed to address the research (Attached
DVD). The objective of the assessment by the experts is to choose one project that should be
accepted to the project portfolio by the SIFE Salford. Experts will be given same project descriptions
as in the stage 2; however they will make decisions and comparisons according to the instructions on
the screen.
Overview of the software
Expert Choice 2nd
Education Edition is a robust, desktop-based application that enables teams to
prioritize objectives and evaluate alternatives and achieve alignment, buy-in, and confidence around
important organizational decisions (ExpertChoice.com). Forman (2001) states that introduction of

44
the PC implementation, Expert Choice allowed growth of AHP applications around the world across
industries.
Wyatt (1999, p.137) analysed Expert Choice software and stated that it focuses on alternatives
evaluation. It helps policymakers choose, by converting their comparative ratings for alternative
policies into ratio scale scores. The strength of the software is the ability to warn experts about their
inconsistency in ratings.
Table 3. Categories of problems that have been addressed by Expert Choice (Source: Wyatt, 1999,
p.137)
The table above shows the categories which can be addressed by studied software. The case of the
dissertation research lies within first category regarding the investment and strategies. The studied
society needs to select the project to their portfolio that will suit their capabilities and requirements.
The software had been designed by Thomas Saaty, a mathematician who worked in the Wharton
Business School at the University of Pennsylvania and later at the University of Pittsburgh (Wyatt,
1999, p.137). He is the author of Analytic Hierarchy Process (AHP) approach, which utilizes complex
analysis of users’ preferences matrices and underpins the Expert Choice package (Forman, 2001 and
Wyatt, 1999).

45
Expert choice assessment step by step
Step 1: Set up of the assessment file
Graph 13. Expert Choice main screen
The main screen of the Expert Choice gives an overview of all the options available. Firstly, there is a
need to clarify the goal of the assessment.
Goal: Selection of the project to the project portfolio for SIFE Salford
Further, the identification of criteria chosen (which have been derived through the survey):
Financial stability (of an external organization)
Payback (time needed to recover the investment)
Social Return on Investment (Value in Pounds)
Risk Analysis (number of risks & their probability/impact)
Budget (the size of the total project budget)
Step 2: Criteria assessment
Experts will be asked to compare criteria in pairs and choose the importance of the criteria to them.

46
Graph 14. Expert Choice criteria analysis
The assessment of those criteria will give them a rate that will be used further by the software to
calculate next decisions.
Step 3: Projects assessment
The final step undertaken by the expert is assessment of the projects regarding each of the five
criteria, one by one. Projects are compared in pairs regarding each of the criteria by turns.
Graph 15. Expert Choice project assessment screen
Using software
Basically, the interface of the software is user friendly. The expert can make decision in three ways.

47
First option is on the scale from 1 to 9, where 1 shows that criteria or options are equal and higher
marks illustrate advantages.
Graph 16. Expert Choice decision screen 1
Second option allows expert to choose options expressed in words: Equal, Moderate, Strong, Very
Strong, and Extreme.
Third option is very graphical, where expert can decide advantage of criteria or option through the
illustration by clicking on red or blue strip, which will result in changing colours on the right hand side
circle.

48
The expert may choose which method of assessment is more suitable for him or her. It does not
affect the final score as the software calculates the graphic illustrations and words expressions to
numbers and uses complicated mathematical algorithms to produce final score.
Step 4: Analysis of the results
Once all the experts make the assessment the software calculates the ratings and scores into results
which can be analysed through various graphs and options, which will be presented in findings
chapter.
The representatives from four identified groups: Project Managers, Volunteering & Community
Organizations Managers, Management Committee of SIFE Salford, experienced employees, who
work on projects, will be asked to participate in Expert Choice assessment. They will be assisted by
the researcher, who will explain how to operate the software and what applications it has. The
people who take part in this stage of the assessment will be the same who have been interviewed;
therefore they will be able to leave their comments regarding the comparison of the selection
methods they got familiar with.

49
Data collection
Experts will be shown how the software works and then on the computer with the licensed software
will assess the projects. Their decisions will be recorded in the software in the specially designed file.
Further their opinions and comments will be recorded by the researcher on dedicated sheet.
Limitations
Forman (2001) outlines the limitations of the Analytical Hierarchy Process and use of Expert Choice
software. First of them is that humans make relative rather than absolute judgements. Secondly, the
judgments are not very accurate whether the expert will use 1-9 scoring scale or worded scale.
Thirdly, experts can be inconsistent in their judgments. However, expert choice reveals the
inconsistency ratio for each expert and set of judgments. The reasons for inconsistency can be
various from lack of information, concentration to inadequate model structure. Nevertheless,
Forman (2001) argues that it is more important to be accurate than consistent, mainly because the
real world is not consistent and this will appear in expert judgements.
3. Ethical issues
Thyer (2001) outlines that in any research there are ethical issues, which needs to be taken into
consideration. Levine (Reamer, 2001) states that research participation should be voluntary and
informed. Also the data gathered should be protected and published fully to avoid any forgery. Thyer
(2001) adds that at the initial stages, when questions are being prepared the must be constructed in
the manner that does not offend anyone.
The ethical issues will be taken into consideration by researched when constructing the questions
and further analysis of data gathered. The researcher is ethically obliged to ensure the relevance and
usefulness of secondary data to the problem at hand (Malhotra, 2007, p.117).

50
Summary
The research aims to address the objectives and gather data that will allow further analysis, which
will result in recommendations for the organization. The secondary and primary research will be
undertaken to find the best solution and approach.

51
IV. Chapter: Research Findings and Results
This chapter focuses on the analysis of the results and findings from research undertaken. The aim to
illustrate different opinions of the experts regarding research topic and objectives and then to
analyse them, which will allow further discussion in next chapter.
1. Survey Results
Twelve experts representing four target groups responded to online survey. The aim was to identify
the most significant criteria when selecting projects into project portfolio. Detailed information
about responses of the survey is outlined below.

52
Graph 19. Detailed survey analysis
After gathering and analysis of the results the ranking of the criteria chosen by the 12 experts
participating in research have been created:

53
Position Criteria Rating Average
1 Financial stability (of an external organization) 4.50
2 Payback (time needed to recover the investment) 4.25
3 Social Return on Investment (Value in £) 4.20
4
Risks Analysis (Number of risks and their
probability/impact) 4.00
5 Budget (The size of the total project budget) 3.75
6 Volunteers (number required) 3.67
7 Profit (generated for the organization) 3.20
8 Sustainability of the impact 3.00
9 Impact (the number of people impacted and scope) 2.88
10 Feasibility of implementation 2.75
11 Learning benefits (for the organization and volunteers) 2.50
12 Time (Duration of the project and hours required) 2.20
13 Cost (obtained by the organization) 2.00
14 Security of the project 2.00
15
Training and Support (Available to volunteers from
external organization) 1.50
16 Prospect to hand down the project 1.00
17 Partners (Number of partners involved) 0.00
18 Net Present Value (NPV) 0.00
Table 4. Ranking of the criteria
Top five criteria from the ranking were chosen to create project descriptions (Appendix 2) which
were used for the second stage of the assessment and research.

54
2. Interview results
The interviews had been performed as an open discussion welcoming comments regarding every
aspect of presented methods and assessments. However, the interview was guided by the four main
questions and issues presented in detail in Appendix 5, which also includes detailed transcript of the
interviews. Each of the interviewees asked not to be named in the paper, therefore they are only
named by the positions they perform. Furthermore, the results of assessment using the scoring
method are presented in detail in Appendix 6.
Interview 1: President of SIFE Salford (PoSS)
 Comments on the criteria chosen by the experts through survey
PoSS analysed the criteria and stated that the duration of the project should be judged along the
other criteria because we have a big turnaround of volunteers in SIFE and on average they work for a
year, therefore short projects are more successful than long, unless the same project leader remains.
On the other hand PoSS argued that the payback criteria is irrelevant to our organization as the only
thing we invest is time so it is difficult to measure such thing. The suggestion is to change payback
into impact. Accordingly, the comment on Social Return on Investment criteria indicated that
although it is important criteria it is very difficult to estimate. Finally, PoSS stated that risk analysis is
very important, although most of the time projects are very risky so there is a need to find a balance
between projects.
 Comparison of the two methods: scoring and Analytical Hierarchy Process (AHP)
PoSS has described the scoring method as very straight forward, easy to understand and fast – giving
the results just after scoring all criteria and projects. However, the AHP has been described as more
challenging, asking more questions which made the expert think about the projects and criteria. It
put all scoring, selecting into perspective and give the idea of broader environment. Moreover, PoSS
stated that comparison of projects and judging them against each other and criteria as used in AHP

55
method gives deeper analysis and more accurate scores. Furthermore, PoSS appraised the Expert
Choice software as easy to follow and navigate, which made selection process easy.
 Analysis of usefulness and appropriateness of methods presented for SIFE Salford
PoSS stated that both of the presented methods are worth implementing. However, the AHP is more
reliable in my opinion as it makes the expert think more deeply and pair comparison gives more
accurate scores. Moreover, the possibilities of Expert Choice – graphic display of results and easy
combination of judgments of different experts makes the whole process very smooth and easy.
 Implementation of the selection methods
PoSS agreed that implementation of selection methods is worth for every organization, especially like
SIFE Salford. The importance of demanding the application forms similar to project descriptions was
noted. PoSS would choose the AHP method to implement, however the only constraint is cost of the
software, if there was a free application to use then it would be implemented.
Interview 2: Project Manager (IPM1)
According to IMP1 the criteria chosen by the experts are accurate. However ‘payback’ is too general
criteria for IMP1 and would change it to impact. Moreover, IPM1 would add one extra criterion –
effort required by the social enterprise.
Scoring method:
 Clear and easy method to implement
in any organization
 Does not need extra resources, might
be implemented in any spreadsheet.
 This method shows you clear choice –
top score
 No advice in case of the same result
 For bigger organizations process of
choosing project might be too simple,
not many factors

56
AHP/Expert Choice:
 Confronts criteria as well as projects
 Gives more complex results
 Difficult to get the same results for
two projects
 More illustrative method
 Requires software
 Different ways of assessing criteria
and projects are not synchronized
(two gives 1-9 scale, one can give 1-
90) huge errors might occur
IMP1 suggested that selection methods are very useful for the organization to implement. However,
for the beginning expert would implement scoring method, and once the SIFE Salford grows the AHP
could be implemented if the software is free.
IMP1 would definitely implement AHP method; however the cost of the software is the main
constraint. The process of implementing Expert Choice and AHP would require organization to train
the people how to use the software properly, as lack of experience might provide to errors and
wrong decisions. Moreover, people have to be convinced to software results, because very often
they might be different than results based just on judgments.

57
Interview 3: Community & Volunteering Manager (CVM)
CVM was surprised that duration has not been included as criteria as well as that expert chosen the
payback over the impact, which is more important in social enterprises. Regarding the budget, CVM
argued that it is not that important criterion to analyse as if the project is worth doing then some
funding will be always available.
CVM has never used any of the selection methods despite long experience in working with projects.
CVM valued AHP over scoring method mainly because the comparison of projects made expert focus
and analyse more deeply. Accordingly, the AHP method is more accurate as during judging there was
deep analysis involved, while the judging in scoring method took only few minutes without actual
consideration of options.
CVM would the AHP method for SIFE Salford, as it allows scoring by different experts and then
combines their scores. It is very efficient and would speed decision making process, as there are
always too many discussions over such topics. Also, AHP helps with smart decision making as it asks
many questions during the scoring process, while the scoring method is very limited and too fast.
CVM would certainly implement the AHP method. However, CVM states: I think it is not only useful in
selecting projects to the project portfolio but has many other potential applications such as choosing
the right supplier for the event.

58
CVM would adjust the criteria to the organization and case, then ask external organization write
proposal in bit more detail, but not too much – to make the process easy. CVM suggested that
explaining the method to the experts is crucial as understanding is a key to the assessment.
Interview 4: Project Member/Associate (IPA):
IPA stated that the Social Return Investment criteria could be more explained, how this will be
achieved and measured. Further, IPA would change payback criterion to number of volunteers
needed. Moreover, IPA believes that time/duration should be a criteria, because SIFE Salford is a
student driven organization, and members have limited time, which is main constraint
According to IPA the scoring method is much easier to implement and use, because it is very
straightforward. At the same time, the AHP made it difficult to judge against the criteria, however
made expert think and analyse more deeply.
IPA states that both methods would be very beneficial for the SIFE Salford. IPA would initially
implement the scoring method, and with the progress and more complex decisions the AHP. AHP: I
think AHP would be beneficial to implement in further stages as it allows updating the information
during the progress of the projects, and such analysis would help the management with further
portfolio decisions.

59
IPA would generally improve the criteria and adjust them to the organization that needs selection
technique. Then IPA would train people about the whole process and the purpose – choosing the
most suitable project for the organization. Further suggestion stated that improving the project
descriptions by providing more background information of the projects would be beneficial with
some summary; more detailed information would be needed from organization. IPA: I would
certainly consider implementing AHP method, if there was freeware software to use it with.
3. Results of scoring method assessment
In summary experts learnt the mechanism of the scoring method and judged it as very easy to use
and implement. The straightforwardness of the method has been main advantage of it. However,
experts learnt after using the second method – AHP, that scoring method is not very demanding and
did not make them analyse or consider options in greater detail.
Each expert was asked to score projects against the criteria (details in Appendix 6); the summary of
their scores is presented in a table below.
Expert / Project Project A Project B Project C
Expert 1: President of SIFE Salford (PoSS) 43 71 72
Expert 2: Project Manager (IPM1) 55 60 64
Expert 3: Community & Volunteering Manager (CVM) 34 60 57
Expert 4: Project Member/Associate (IPA) 52 73 82
Total score 184 264 275
Table 5. Results of scoring method assessment

60
4. Assessment results and applications of the Expert Choice
Each expert has learnt how to use the Expert Choice which is software that manages the AHP method
to allow judgments and scoring in user friendly environment. Experts valued the method because of
the comparison aspect of criteria and projects which made them judge and analyse in greater detail.
Also, they believed that AHP presented more accurate score because of the cross judging and more
thoughts that were put in judging than during scoring method assessment. Moreover, the software
allowed easy combination of score of the projects but also put into consideration the combination
weight given to criteria, which has been skipped in scoring method.
The combined results of the assessment are presented below.
Graph 20. Combined results of AHP assessment
The graph above shows the combined score for the project made by four experts. It also indicates
the weight of the criteria used in the pillar graph on the bottom. The results of judgments of each
individual expert are presented in Appendix 7. The Expert Choice software with the file used for the
assessment has been placed on DVD added to this dissertation for further analysis and presentation
of results.

61
V. Analysis and Discussion
This chapter brings together analysis of the literature and researches of other authors and research
undertaken in this dissertation. Both sources were used to answer the research questions and
address the objectives settled in the beginning of this paper.
Objective 1: The analysis of the projects criteria to outline the most
important and adequate for the process of selection into project
portfolio
Every project is very complex and consists of many elements, which have to be analysed when
selecting projects into project portfolio. Wysocki (2003) admits that there are many criteria outlined
by various authors that are significant and need to be taken into consideration. However, the social
enterprise is often small or medium business which has not enough resources to allow deep analysis
of each of them, according to interviewed project manager (IPM1). Therefore, the ranking created
using the survey, outlined top five criteria, which should be analysed in detail by social enterprises,
this include: financial stability (of an external organization), payback, social return on investment, risk
analysis, budget. This ranking has been created after receiving responses from twelve independent
experts. However, Cooper (2001) argues that the project should have a strategic alignment with
mission of the business and those that do not fit should not be taken into consideration. Martino
(2003) adds analysis of the competition as important criteria; however for the social enterprise it is
insignificant as the projects in most cases are submitted to organization not by the business.
However, it is interesting aspect if enterprise is applying for the grant, then analysis of
microenvironment would be helpful. On the other hand, Cleland (2003) mentioned duration of the
project as important criteria, which has been outlined in the project description, but not analysed as
a criteria. However, Community & Volunteering Manager (CVM) and President of SIFE Salford (PoSS)
commented that duration should be also analysed as criteria, agreeing with Cleland (2003), because

62
there is a big flow of volunteers and average time worked is one year. Furthermore, Levine (2007)
and Westerveld (2003) outlined payback as very significant criteria; however CVM, interviewed
project associate (IPA) and PoSS argued that payback is not significant as it is difficult to estimate and
measure, therefore it is inaccurate. PoSS suggested that payback could be changed to impact
analysis, which is more important for social enterprise.
Stewart and Mohamed (2002) outlined that many authors focus on economic criteria such as return
on investment, cost-benefit analysis, and net present value. However, these have to be applied to
social enterprise case. All interviewees agreed on significance of Social Return on Investment (SRI)
criteria in project selection. While, regarding the financial stability criteria, the PoSS and IPM1
recognize the need of analysis of this area, but mention that it is important to analyse how the
project will be treated by that organization. If the project is independent and has its own budget,
then the financial situation of “employer” does not matter to social enterprise, unless it is paid in
instalments.
Rad (2006) mentioned that the size of the budget is an important criterion, however should not be a
key criterion. This is very true in social enterprise projects. PoSS mentioned that most of the projects
they do have limited or no money and they run fundraising activities to make them happen.
Accordingly, if a project has some sort of budget then it is very helpful, but if the project addresses
the social need, then this constraint can be easily overcome with a help of sponsors and partners. On
the other hand, IPA stated that budgets ease and speed up the progress of the project, and if there is
a need to complete many projects by the organization in short time (i.e. competition coming up),
then it is important to choose one with solid financial backup.
Finally, all the experts agree that risk analysis is crucial criteria, which helps with creating a balanced
portfolio, where organization should have some risky but rewarding projects and those certain with
less rewards.

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In summary, the five project criteria concluded through survey and commented in interviews are the
most appropriate for the social enterprise, with one exception of payback, which according to PoSS
and CVM should be exchanged with impact analysis (placed 9th
in the ranking). Visitacion (2006) and
Levine (2007) emphasize that each project should be firstly analysed if it fits to the organization’s
strategy, mission and objectives before going through the selection process and interviewees agreed
with that. Projects that do not fit to portfolio or similar already exist should not be taken into
consideration.

Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case study of SIFE Salford.

Building a project portfolio in the social enterprise. Analysis and implementation of project selection methods. Case study of SIFE Salford.

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