Analyzing Risk Interaction Effects Among IT Projects Based on Modern Portfolio Theory
Financial services providers usually conduct multiple concurrent IT projects and have to constantly allocate their resources on the projects in an efficient way. Naturally, they may realize cost synergies among projects - e.g. due to infrastructure sharing - depending on the projects' resource requirements. However, exploiting resource interactions leads not only to cost synergies but also to risk interaction effects. The authors propose a conceptual model based on the modern portfolio theory to study these risk interaction effects among IT projects.