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A firm decides whether to produce its own components or to buy them from outside. What is this decision called?
AThe routing decision for the workflow
BThe layout decision for the facility
CThe scheduling decision for each step
DThe make-or-buy decision for materials
Answer & Solution
Correct answer: D. The make-or-buy decision for materials
1. Every producer has to settle where its production materials will come from.
2. The choice between making them internally and buying them outside is the make-or-buy decision.
3. Quantity is one consideration, and secrecy of design is another.
4. Routing, layout, and scheduling all concern how work moves rather than where materials come from.
_Source: OpenStax Introduction to Business (CC BY 4.0), Ch 10 "Achieving World-Class Operations Management", section Make or Buy?_
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