Answered step by step
Verified Expert Solution
Question
1 Approved Answer
reply to When a company must make a build or buy decision, several factors should be considered. Obviously, price is one of the driving factors.
reply to When a company must make a build or buy decision, several factors should be considered. Obviously, price is one of the driving factors. Teams making these decisions should use net present value to compare costs associated with building or buying (Berk, 2010). However, cost should not be the only factor considered. Risks must be evaluated as well. There will be risks with either building or buying. For example, will you have the manpower to manufacture something in house? Likewise, if you outsource, you can run the risk of supply chain issues which could set your schedule behind and increase your costs. Also, when the product or service is needed would be something to consider. Building might not be feasible if there is a tight deadline. Buying would be best in this situation since the product or service is "off the shelf", however, the cost might be higher
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started