Make vs. Buy

PROMPT: The ACME Company (TAC) is a large technology and innovation company with multiple divisions providing systems, subsystems, components and services. Corporate Supply Chain has implemented an aggressive strategic sourcing program and is focused on aggregating the spend across all its divisions. The company has several mature production capabilities that they believe are best in class. They currently have a partially-outsource or concurrent sourcing approach where they simultaneously make and buy the same product. It has been a challenge to get the divisions to agree that they should use the internal capabilities (make) rather than outsource for these capabilities (buy). The current process is ad hoc with Program Managers creating an analysis that supports their opinion. TAC needs a non-biased Make vs Buy (MvB) process that all the divisions can adhere to. They will pilot a project on their circuit card assembly (CCA) production capability to determine a framework for their MvB decisions. The goal of the project is to create a companywide MvB process that is analytical, data driven and encompasses all of its internal “Centers of Excellence”. The company’s needs for CCAs vary across divisions and programs within the divisions. The complexity of the product varies from complex to fairly simple and may require newer high technology assembly techniques or older low technology techniques. Some products may need special processes designed to prevent reverse engineering from competitors. The maturity of the design ranges from prototypes in very small quantities to mature production in high quantities. TACs CCA capability resides within one division and provides a high quality product. This division believes they are best suited to handle all of TACs CCA work and that costs will drop as capacity increases. The other divisions believe there is a bias in creating a “Must Make” policy around CCAs. They believe they can get an acceptable product at a lower cost by buying CCAs from an external supplier. Given the case from above: --Identify and read any papers on the Make vs. Buy decision. Attached are some examples. --Develop and describe a non-biased Make vs Buy framework for circuit card products. --Identify the data and criteria that would be needed to perform the analysis making sure to take into account the dynamics from the case. --Reference the papers you have read. Occasional quotes from the article are acceptable, but you need to be convincing that you have read and understand the concepts. Do not copy sentences from the article and use a thesaurus to change key words or phrases. A good site on references is [login to view URL] . You can use any system they describe. --4-6 pages single spaced.