Research on the Make-or-Buy Decision in the Era of Outsourcing
| Project/Area Number |
09630114
|
|---|
| Research Category |
Grant-in-Aid for Scientific Research (C)
|
| Allocation Type | Single-year Grants |
|---|
| Section | 一般 |
|---|
| Research Field |
Business administration
|
|---|
| Research Institution | Yokohama National University |
|---|
Principal Investigator |
MATSUI Yoshiki Yokohama National University, Faculty of Business Administration, Associate Professor, 経営学部, 助教授 (70173789)
|
|---|
| Co-Investigator(Kenkyū-buntansha) |
SASAI Hitoshi Yokohama National University, Faculty of Business Administration, Professor, 経営学部, 教授 (10018012)
|
|---|
| Project Period (FY) |
1997 – 1998
|
| Project Status |
Completed (Fiscal Year 1998)
|
| Budget Amount *help |
¥3,000,000 (Direct Cost: ¥3,000,000)
Fiscal Year 1998: ¥1,200,000 (Direct Cost: ¥1,200,000)
Fiscal Year 1997: ¥1,800,000 (Direct Cost: ¥1,800,000)
|
|---|
| Keywords | Outsourcing / Make-or-Buy Decision / Agency Contract / New Product Development / 製品開発 |
|---|
| Research Abstract |
In this research we approached the make-or-buy decision for manufacturing companies with a special emphasis on outsourcing rather than insourcing both theoretically and empirically, based upon the fundamental recognition that the cycle time of new product developments is rapidly shortened.
Theoretically an agency model for assembler-supplier relationship was constructed under asymmetric cost information, suppose that the supplier agrees to report the value of an uncertain parameter concerning its manufacturing cost to the assembler after observing the true value of the parameter and that both parties ex ante enter into a contract contingent upon the reported value of the cost parameter. Then we derived the optimal contract for the assembler which consists of outsourcing rate, cost-reducing investment by the supplier and supplier's margin, subject to a reservation utility condition and a truth telling condition. An auction model incorporating competition between suppliers was also review
… More
ed. As for the empirical side, we made interviews with purchasing/procurement managers in several manufacturing companies which eagerly promote outsourcing to get some information on merit and demerit of buying outside and hypothesize on the factors which have strong impact on the make-or-buy strategy and priority between them. Using the measurement data collected through a questionnaire for manufacturing plants, we determined the production system elements influencing the make-or-buy decision such as total quality management, production information systems and so on, and analyzed the relationship between make-or-buy strategy and other aspects of manufacturing strategy. Especially for the electric and electronics industry that is characterized as one of the most progressive sectors in outsourcing and new product development, we surveyed some movement toward outsourcing in newly developed products, relying on a questionnaire and interviews, It was found that the performance of a new product development project was higher, when the strategic role of purchasing/procurement department in the project is recognized high and the department commits itself to the project. Less
|
Report
(3 results)
Research Products
(12 results)
