A major strategic dilemma companies used to face was whether to produce all the sub-components of a final product themselves or outsource these parts. Now the older decision-making process has become outdated due to several competing factors. The TCO (Total Cost of Ownership) model is getting obsolete. So, experts have identified a more holistic approach titled coherent capability make-or-buy framework. This framework has a few inherent questions that need to be posed right away, beginning with understanding the impacts of the business innovations and technologies currently. Another is identifying the existing as well as potential competitors or even disruptors in the near future. The third question is about markets and which of the existing markets will remain lucrative in the future. It also looks at product categories whether already prominent or still at the drawing board. The company need also evaluate its product line to see whether there exist any that will be a market leader soon. All kinds of disruptions are evaluated here. This includes commercial, technological and product disruptions.

Source:https://www.strategyand.pwc.com/reports/new-make-or-buy-question

Uploaded Date:13 September 2018