GMS 701 Lecture Notes - Lecture 4: Entire Function, Capacity Utilization, Insourcing

• School: Ryerson University
• Department: Global Management Studies
• Course: GMS 701
• Professor: Jagoda

Document Summary

Quantities are too small and/or no supplier is interested. Quality requirements are too exacting or special processing methods needed. Keep our capacity utilization high and outsource the rest. Distance from the closest available supplier is too great. Market potential for the product or service is expanding rapidly. Forecasts of future shortages in the market or rising prices. Challenges of maintaining technological leadership for noncore activity. Forecasts show great demand and/or technological uncertainty. The ability to bring a product or service to market faster. The necessity argument: (cid:862)we would prefer not to produce this product or service in-house, but we really do(cid:374)"t ha(cid:448)e a(cid:374)y other optio(cid:374)s(cid:863) The opportunity argument: (cid:862)we (cid:449)ould prefer to do this i(cid:374)-house because it would give us a strategic (cid:272)o(cid:373)petiti(cid:448)e ad(cid:448)a(cid:374)tage(cid:863) The necessity argument: (cid:862)we (cid:449)ould prefer (cid:374)ot to outsour(cid:272)e this produ(cid:272)t or ser(cid:448)i(cid:272)e, (cid:271)ut (cid:449)e really do(cid:374)"t ha(cid:448)e a(cid:374)y other optio(cid:374)s(cid:863)