Simultaneous project portfolio selection and scheduling from contractor perspective

Abstract

Optimum project portfolio selection is one of the critical topics in project management. Scheduling selected projects to maximize profit and making project portfolio execution feasible are essential issues in this topic. This research presents a comprehensive model for simultaneous project portfolio selection and scheduling while maximizing the project portfolio’s net present value (PPNPV) and minimizing its resource fluctuations (RF). The presented study considers resource constraints and integrates the selection and scheduling process to form the portfolio with the highest efficiency among different possible solutions from the contractor’s perspective in construction management. The optimum project portfolio with its schedule, resource usage, cash flow and profit are outputted as the results. The developed model has been utilized on six hypothetical projects with diverse task numbers and networks containing all kinds of relations, lags and leads. The results presented an efficient point between fulfiling both goal functions by increasing 8.2% PPNPV and decreasing 8.06% and 13.76% of RF parameters for both resources, respectively. Moreover, the model’s superiority is demonstrated by comparing the results with the existing literature. The model is validated by considering different scenarios and comparing the results with what is expected. Considering task level scheduling, all four types of task precedence relation types and task lags lead to more realistic project networks, therefore, modelling the projects’ situations more appropriately. In addition, contractor’s resource sharing policies are engaged in this study to model contractor’s financial situation more realistically. This model views project portfolio selection and scheduling form contractor’s perspective, therefore, it lets contractors to benefit from using detailed scheduling and modelling contractor’s resource sharing policies. It is demonstrated that the presented model allows contractors to form an optimum project portfolio while considering financial and resource constraints.