To Make or To Buy?

Traditionally, when people choose whether to make or buy, they only think of the two options—more than often, these choices are not the most optimum solution. Company leadership is constantly being put in a difficult position to choose these options by weighing the pros and cons.

Making or doing it ourselves has the highest degree of ownership, flexibility, and control. It will have the most flexibility to customise based on what the management wants. It could be a double-edged sword where any significant changes will also be challenging and have a high degree of implementation time and cost.

On the other hand, buying it from the market and taking off-the-shelf solutions might be the most cost-effective solution, easy to implement and low operating cost. However, there could be a risk that the solution offered might not suit the business’s needs. There could be a gap that might disrupt the business flow if it is not appropriately addressed. Moreover, it will be challenging to adapt and control a minor business change.

Many companies have recently realised that making or buying might not be the optimal solution available. Companies have started to offer personalisation customisation on their solutions. People don’t realise that this option is not to make or buy, but rather a hybrid between the two. The answer is often not a combination of both but better than any (Figure 1).

Figure 1: Pros and cons of choosing to buy, to make or hybrid