International Business Research Paper Example | Topics and Well Written Essays - 2500 words

International Business - Research Paper Example ates and sold domestically. Furthermore, it is the hope of this author that by elaborating upon the fundamental decision-making structure that must be engaged with in order for such a choice to be made logically, the reader will come to a more full and complete appreciation for the many factors that take place prior to affirm determining what particular strategy and means of operation it will pursue. Finally, the analysis will seek to take a definitive stance with regards to whether making or buying a product is the better approach. Before delving too deeply into the issue at hand, it should be understood that such a level of inquiry necessarily demands that the firm/business entity must engage in a cost-benefit analysis of outsourcing versus domestic production. However, although it may seem that this cost-benefit analysis is necessarily something that is simple, it involves a series of steps, several different measurements, and a thorough analysis of both compliments and inputs of production as well as projected levels of sale and/or import tariffs/taxes/duties (Kisner, 2003). Due to the general complexity of this decision-making process, many firms have engaged in electronic software systems that help to keep a running tabulation of all differentials involved. However, for purposes of this brief analysis, the reader should seek to integrate with the determinant costs and benefits based upon experience analytical and non-electronically facilitated process. From even a cursory review of the make versus buy argument, the reader should come to understand there are essentially for primal numbers that the analyst must be fundamentally aware of. These four determinants which must be measured prior to any consideration being given are as follows: the volume, the fixed cost of making, per-unit direct cost when making, and per-unit cost when buying (Whittle, 2012). Accordingly, the preceding analysis will seek to engage the reader with a more full and complete underst anding of why each of these four determinants must be fundamentally understood and appreciated prior to any actionable decision being made by the entity in question. Besides the obvious level of importance of the four specific values which have been listed an elaborate upon the above, their overall importance is more specifically with regards to their representation within two specific equations. Ultimately, as can be expected, these two equations are understood as â€Å"costs to buy was quote and â€Å"costs to make†; however, more often, these equations are merely referenced in terms of their respective acronyms – CTB/CTM. Respect to CTB, this can be defined as volume multiplied by per unit cost when buying (Zhu, 1997). Likewise, with relation to CTM, this can be understood as fixed unit costs plus per unit direct cost multiplied by volume. In and of themselves, the determinant compliments of these equations tell the producer/importer little if