Seminar in PM Week 3 Assignment
Jaylin001
CaseStudyOverview.docx1
5
1-2 Journal: Case Study
Terrell McGhee
QSO-680 Seminar in Project Management
SNHU
8/28/2022
Case Study
Healthcare costs have risen to the point that businesses have acknowledged spending more on healthcare coverage than production costs. Due to escalating expenditures, research and development organizations are pressured to contribute efficient ways of developing drugs to reduce costs (Bode-Greuel & Nickisch, 2008). Against this backdrop, organizations in the pharmaceutical industry are employing portfolio management to evaluate the commercial benefits and the underlying risks of development projects. Portfolio management, as illustrated in the case study, involves the effective allocation of resources to maximize the gains of research and development initiatives.
The project's portfolio management success is often influenced by its objectives, which must be concisely analyzed and aligned to maximize the portfolio's value. The case study "Value-driven Project and Portfolio Management in the Pharmaceutical Industry" aims to address the high cost of producing drugs in the pharmaceutical industry (Bode-Greuel & Nickisch, 2008). The high cost of drug production has imposed mounting pressure on the industry R& D experts to find more cost-effective ways of drug production, which will help to lower the overall cost of medication.
Project, portfolio, and program have similarities and differences that must be understood at the management level. A narrow perceptive project is typically a single focused plan to achieve a predetermined goal. Still, a program is a collection of projects coordinated and implemented to complete a set objective (Minelle et al.,2022). On the other hand, a portfolio is a group of projects or programs that are either implemented collectively or independently. The independence or collectiveness of portfolio management depends on the risk structure and tolerance of the project managers. From the case study, the project portfolio and program draw some similarities based on time management, communication, and scheduling which are inherent in both cases. As illustrated in the case study, portfolio management is focused on achieving cost-effective research and development projects that lead to the lower cost of production of drugs in the pharmaceutical industry. Portfolio management influences the choice of the project and ensures that the programs implemented will be effective and value-driven through cost reduction and value maximization.
The case study shows that the project and portfolio management programs impact three stakeholder groups. Companies in the pharmaceutical industry will be the first group to be affected by portfolio management by reducing the cost of production of drugs. Effective selection and implementation of research and development projects will be a precursor to lowering the increasing cost of production in the pharmaceutical industry, thus helping companies reduce the cost of pharmaceutical products. The decreased cost of drugs will also spill over to customers such as General Motors and Starbucks. Reports from the two companies indicate that they spent more on medical and insurance coverage than on raw material acquisition in 2004 and 2005, respectively (Bode-Greuel & Nickisch,2008). The third target group is the patients who benefit from the value-driven project and portfolio management through reducing pharmaceutical charges. When companies in the industry achieve cost-effective drug production, the cost of pharmaceuticals will be lower, thus reducing the overall pharmaceutical cost to benefit the patients.
This case study presents a straightforward business strategy that focuses on reducing the cost of pharmaceuticals by increasing both the effectiveness and productivity of the drug development process. This corporate strategy is concentrated on increasing productivity which is aligned with the value-driven research and development initiatives that will increase efficiency and reduce the overall cost of production of drugs in the pharmaceutical industry (Bode-Greuel & Nickisch, 2008). By focusing on value-driven portfolio management, project selection with based on how they are aligned with the corporate strategy with efforts directed at realizing the strategic objectives of the pharmaceutical companies.
The role of the project manager in this case study is precisely defined and involve ensuring only value-driven portfolio are implemented. With the project's objectives clearly defined as reducing the cost of manufacturing drugs in the pharmaceutical industry, project managers will be central to selecting, assigning resources, and implementing research and development initiatives to lower the overall cost of production (Bode-Greuel & Nickisch, 2008). To accelerate the success of this project and ensure effective portfolio management, project managers will be essential in ensuring that the portfolio is aligned with the corporate strategy and communicated to the employees throughout project implementation.
References
Bode-Greuel, K. M., & Nickisch, K. J. (2008). Value-driven project and portfolio management in the pharmaceutical industry: Drug discovery versus drug development–Commonalities and differences in portfolio management practice. Journal of Commercial Biotechnology, 14(4), 307-325.
https://link.springer.com/article/10.1057/jcb.2008.6
Minelle, F., Pirozzi, M., Quagliarini, A., Apponi, F., Brusciotti, F., Buzzi, D., & Mancone, M. (2022). Project, Program and Portfolio Management for the National Recovery and Resilience Plans in the European Union.
