Case Debrief - Supply Chain Management – Case Study Example
Case Study Debrief Trail Frame Chassis (TFC) should opt for insourcing instead of outsourcing. Considering the fact that the company has managed to be a leader in the design and marketing in the previous years, it can invest successfully in its internal designers and get back a greater percentage of the market share. The design company that has placed an offer presents more disadvantages to TFC than the potential benefits. Since TFC has registered low profits in the recent past, it only has around $200,000, which it intends to spend on expanding the design capacity. Computer-Image is placing an offer that costs $100,000 more than TFC is willing to spend. Moreover, TFC requires designs to be delivered immediately, while Computer-Image can only deliver after 3 months. This will pose a delay for the TFC Company, which needs to recover its market share as soon as possible. Notably, Computer-Image expects to work on 1250 designs annually, without considering the type of growth registered by TFC. The fact that Computer-Image requires TFC designers to spend 6 months in the orientation of their designers translates to additional responsibilities on the side of TFC. In a real sense, TFC would spend such time and money in empowering its designers to attain the required standards. Computer-Image will be working with other chassis builders a factor that may affect its output and lead times in delivering designs for TFC. Therefore, it is best for TFC to invest in insourcing of designers and reject the offer made by Computer-Image because it presents more disadvantages than advantages (Schniederjans, Schniederjans, and Schniederjans 17).
Schniederjans, Marc J, Ashlyn M. Schniederjans, and Dara G. Schniederjans. Outsourcing and Insourcing in an International Context. Armonk, N.Y: M.E. Sharpe, 2005. Internet resource.