Developing a framework for make-or-buy decisions

• Published in: International journal of operations & production management Vol. 20; no. 11; pp. 1313 - 1330
• Main Authors: Cánez, L.E., Platts, K.W., Probert, D.R.
• Format: Journal Article
• Language: English
• Published: Bradford MCB UP Ltd 01.11.2000; Emerald Group Publishing Limited
• Subjects: Buy or make decisions; Case studies; Economic models; Literature reviews; Manufacturing; Outsourcing; Production planning; Strategic management; Studies; Sourcing; Make v. buy; Outsourcing; Decision making
• ISSN: 0144-3577; 1758-6593
• DOI: 10.1108/01443570010348271

The make-or-buy question represents a fundamental dilemma faced by many companies. Companies have finite resources and cannot always afford to have all manufacturing technologies in-house. This has resulted in an increasing awareness of the importance of make-or-buy decisions. This paper reports on the development of a make-or-buy framework to address the make-or-buy decision for either a specific individual part or family of parts. Firstly, a literature review of the principal make-or-buy approaches is discussed. Secondly, the development of a make-or-buy framework is described and the framework is explained and illustrated using case studies. Thirdly, the operationalisation of the framework is outlined. The paper concludes with a discussion of its contribution to both the academic understanding of the subject, and the improvement of industrial practice.