BUY OR BUILD DECISION SUPPORT SYSTEM In the wake of globalization, the cost of managing an organization in regard to products supply and logistics has become central in determining success. This has led to increased research on how to make informed decisions on which method to adopt as far as purchasing and supply chain is concerned. With the emergence of information and communication technology integrated supplier selection system, efficiency is possible and profitability is achievable (Lee, et al. 2006). It is worth to note that selection of the supplier is currently a pertinent decision as regards supply chain management for various industries and particularly processors and manufacturers.
The issues to be dealt with therefore revolve around establishing an effective supplier network management. This constitutes supplier selection criteria identification, selection decision on the supplier and supplier progress monitoring. Decision support system involves integration of a supply and logistic model in which accurate, quick and efficient decisions can be reached. Building a decision support system is both economical and sustainable. Opting to build rather than buy helps the organization in minimizing the risks associated with procurement section in preference to routine outsourcing on order-placing.
Grey relational analysis (GRA) model is one of the widely used applications (Lee, et al. 2006). As it seeks to evaluate the supplier, it captures the quality of the product, purchase price, date for delivery, and quantity demanded. The simple steps to make appropriate decision regarding application are as shown below. Set objectivesIdentify alternativesEstimate costsConsider the availability of skilled human capitalCollect data and analyzeCalculate the grey relational gradeDetermine the best supplierThe above highlighted steps will help in building a decision support system that will remain profitable and sustainable by the organization. ReferenceLee, J., & International Workshop on Data Engineering Issues in E-Commerce and Services, DEECS.
(2006). Data engineering issues in e-commerce and services: Second international workshop, DEECS 2006, San Francisco, CA, USA, June 26, 2006 : proceedings. Berlin [etc. : SpringerLink [host.