An Overview on Established Modes of Make Vs Buy

An Overview on Established Modes of Make Vs Buy

An Overview on Established Modes of Make Vs Buy

The decision to outsource or develop in-house is not new. The field of eLearning being fairly nascent, I think this dilemma is more clearly delineated in our context. Given the current scenario, it might be a good idea to look at a few industries where the Make Vs Buy decisions are an established activity. In these industries or domains, decision making is refined and dependent on highly sophisticated analysis.

Let’s go back to the world of manufacturing where Make Vs Buy scenario has been around for a very long time. In the manufacturing world, make-or-buy decisions usually arise when a manufacturer is faced with diminishing capacity or changing demand. Here listed a few factors influencing Make or buy decisions.

Make IFBuy IF
Skill sets available.Lack of in-house expertise.
Less expensive to make the part.Less expensive to buy the part.
Excess plant capacity.Insufficient capacity.
Direct control over production and/or quality.Confidence in vendor ability on timelines and quality.

That was the world of manufacturing. Now let’s take a quick look at the world of IT and ITES, where there has been a boom in outsourcing in recent years and where outsourcing is an everyday reality. So how would you go about the build vs. buy decision?

Build IFBuy IF
In-house solutions costs less than outsourced solution.Outsourced solution costs less than in-house solution.
Solution is core to your business.Solution is not your core business.
Better quality with in-house development.The vendor has demonstrated expertise and processes to ensure quality.
The business need is unique and there are no off the shelf solutions or they cannot be customized.The solution lends itself to customization and can be implemented faster.

Based on the various factors for evaluating the make Vs buy decision that we looked at in the manufacturing and IT world, we can simplify and create a consolidated list of the main criteria influencing the buy or outsource decision of eLearning. Hence, this will provide a useful framework on which steps, and to what extent, you can consider in-house development or outsourcing of eLearning.

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