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    Advanced Procurement Management

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    Akum oben
    The document summarizes research on the 'make or buy' decision process for procurement in small and medium enterprises. It discusses factors involved in the decision, including cost, supplier capabilities, and quality. The methodology used a case study of a small company where the researcher participated in meetings to analyze the decision process.

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    Advanced Procurement Management

    Uploaded by

    Akum oben
    41 views3 pages
    The document summarizes research on the 'make or buy' decision process for procurement in small and medium enterprises. It discusses factors involved in the decision, including cost, supplier capabilities, and quality. The methodology used a case study of a small company where the researcher participated in meetings to analyze the decision process.

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    ADVANCED PROCUREMENT MANAGEMENT

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    The document summarizes research on the 'make or buy' decision process for procurement in small and medium enterprises. It discusses factors involved in the decision, including cost, supplier capabilities, and quality. The methodology used a case study of a small company where the researcher participated in meetings to analyze the decision process.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    41 views3 pages

    Advanced Procurement Management

    Uploaded by

    Akum oben
    The document summarizes research on the 'make or buy' decision process for procurement in small and medium enterprises. It discusses factors involved in the decision, including cost, supplier capabilities, and quality. The methodology used a case study of a small company where the researcher participated in meetings to analyze the decision process.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
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    ADVANCED PROCUREMENT MANAGEMENT

    TITILE:

    A review of Analysis of the “Make or Buy” Decision Process in a Research and


    Development SME.
    CITATION:

    Mohammad A. S., Baguley P. and Ashutosh T. (2013). Analysis of the “Make or


    Buy” Decision Process in a Research and Development SME, Proceedings of the
    11th International Conference on Manufacturing Research (ICMR2013), Cranfield
    University, UK, 19th – 20th September 2013, pp 473-478.

    BRIEF SUMMARY

    Small and medium sized enterprises (SMEs) contribute to a country’s economic


    growth and GDP. SMEs are mostly dependent on credit than large industries. A
    number of authors have reviewed this concept of “Make or Buy” decision in
    SMEs.

    Coase (1937) introduced the “idea of transaction cost” in economics and developed
    the economic theory of the firm which was the basic model for “Make or buy”
    decision. “Make or buy” is defined by Zenz (1994) as the decision of whether to
    make a product in-house or buy from suppliers. Probert (1997) defines “Make or
    buy” decision as whether to carry out a process or activity in your own business or
    to assign it to suppliers. “Make or buy” decision is not only limited to cost or to
    speed to the market of a product. Dale and Cunningham (1984) have mentioned
    other factors other than cost in the decision making and evaluated their importance.
    Suppliers’ capabilities and quality are among the decision making elements. Also
    “Make or buy” decision making not only can be a cost saving decision, but is a
    strategic activity that can affect the future of company’s’ activities (Fine 2000).
    Dale and Cunningham (1984) have concluded that “Make or buy” decisions can be
    “very complex, time consuming, interactive and affect many departments
    within a company”.

    In general the company is on the margin of transforming from micro organization


    to small enterprise.
    METHODOLOGY;

    The methodology used in this paper is action research in a case study design where
    the researcher chose a SME company and participated in their general and
    technical review meetings and the minutes of the meetings were used for further
    analysis. All sectors of the company like the technical, managerial and marketing
    departments worked closely with the researcher for the realization of this paper.

    CRITICISM

    It can be observed that resource constraints is a day to day challenge for the
    company. The resource constraints exist in terms of human resources and financial
    resources. It can be expressed that lack of human resources is a consequence of
    financial shortages. Due to the criticality of cash flow in SMEs, selecting correct
    methods and processes are critical for future existence of the company. Make or
    buy decision can have long term effects on profitability of a business and wrong
    decisions can result in devastation of a business.

    Also lack of Cost engineering knowledge is tangible in company’s decision


    making and skilled staff in this area is needed which might cause the company a
    lot.

    CONTRIBUTION TO KNOWLEDGE

    In the process of decision making the priority option would be Commercial Off-
    The-Shelf (COTS). By having defined product specifications, similar parts and
    products which would satisfy the required specifications and have proven
    technology would be searched for.

    Searching would be done by looking for vendors through the internet and
    contacting them through phone and email and also enquiring from experienced
    people in industry.

    In the case of finding an appropriate product, a sample product would be ordered


    and different levels of testing would be performed to ensure the quality and
    suitability of the part.
    One of the decision elements is the cost. As mentioned earlier, one of the main
    characteristics of the TGB would be low cost, and to ensure the low final cost of
    the product, low cost components have.

    RECOMMENDATIONS

    REFERENCING

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