Using Portfolio Theory to Support Requirements Selection Decisions

Document type: Conference Papers
Peer reviewed: Yes
Full text:
Author(s): Nina Dzamashvili-Fogelström, Emil Numminen, Sebastian Barney
Title: Using Portfolio Theory to Support Requirements Selection Decisions
Conference name: 4th International Workshop on Software Product Management (IWSPM)
Year: 2010
Pagination: 49 - 52
ISBN: 978-1-4244-8764-6
City: Sydney
URI/DOI: 10.1109/IWSPM.2010.5623864
Organization: Blekinge Institute of Technology
Department: School of Computing, School of Management (Sektionen för datavetenskap och kommunikation, Sektionen för management)
School of Computing S-371 79 Karlskrona, School of Management S- 371 79 Karlskrona
+46 455 38 50 00;
Authors e-mail:,,
Language: English
Abstract: Abstract—Selecting requirements for a release of software is a
difficult undertaking as people have trouble comparing
requirements of different types and have natural biases
towards short-terms gains over longer-term sustainability.
Portfolio theory is proposed as a solution to this problem, as it
provides a method for balancing investment options to
maximize the likelihood of a given return. This approach is
explored generally and through an example. The results
suggest portfolio theory can be applied for this purpose.
Applying portfolio theory to determine the amount of
development time that should be spent on different types of
requirements shows the most potential, especially when data
on expected risks and returns is limited.
Subject: Software Engineering\General
Keywords: Market-driven development, software product, requirements selection, product management, portfolio theory, real options theory