Make or Buy Decision 

Purpose

The standard structure presumes that you want to procure your generator externally since a standard version of this component is being dealt with here.

IDES Canada also produces generators in-house. If you want to be able to compare both these options, create a simulation for this alternative.

Process Flow

  1. Creating the Simulation

    2. Check whether in-house production of the generator is cheaper than external procurement. Create a simulation to do this.

  2. Changing the Network Generator

    3. The simulation is a copy or the operative project. The network for the generator has to be changed so that activities for in-house production have to be planned instead of activities for external procurement.

  3. Planning Material Costs

    4. You have to plan costs for in-house production of the generator.

  4. Comparing the Operative Project With the Simulation

You compare the costs of your operative project with those of the simulation to decide which project you want to use as a base for the creation of a quotation.

Result

On the grounds of the cost situation, you choose the operative project – and therefore also external procurement of the generator.