Goal: strategically, is it more cost-effective and efficient to outsource or insource a project. Is insourcing the best use of a firm’s resources.
Figure out a meal.
Go to restaurant #1 and have the meal.
Go to restaurant #2 and have the meal.
Go to the grocery and buy ingredients to make the same meal at home. You may use ingredients that you already have on hand.
Make the same meal at home. Do not order delivery, take out, or otherwise buy the meal already prepared (e.g. frozen). I will make an exception for french
fries. Also, you must prepare the meal or pay someone (e.g. your mom) at least minimum wage to prepare it.
Snap a selfie of you eating at the restaurants and prepping the home meal (and eating it).
Make sure you have receipts for each of the two eat-out meals and the ingredients that you had to buy for your home meal. If you are an international student
and receipts in English are not available, I will need a translation to accompany the receipt.
Track your travel time to and from the restaurants and store, and your mileage (if driving). Track your wait time at the restaurants (but not your eating time).
Track the time to prepare and clean up your home meal (but not your eating time).
External Data Collected (i.e. from your restaurant meals):
Which restaurant do you usually go to first. Why?
Why did you pick the 2nd restaurant?
What was the total cost of each meal? Include tip, etc. (If you eat out with someone, only include the cost of your meal.)
How much time did you spend from leaving home to returning home? Do not include eating time.
How far did you drive?
Think through any other time and expenses incurred in eating out.
Internal Data Collected (i.e. from your home prep meal):
Where did you shop for the ingredients? Why? Did you have to go to more than one store? How far did you drive?
For the costs, pro-rate out the expense. If you buy something, what portion of it did you need to use. Adjust the costs accordingly. Do not forget an ingredient.
Each cost input impacts the costs of goods sold which impacts the price and net income.
Keep track of all time involved except the time spent eating the meal. Include driving, shopping, cooking, and cleaning time (remember that in a restaurant,
someone cleans up after you).
Add up the out-of-pocket expenses for each of the three alternatives.
Calculate the economic value of your time for each alternative. If you work, what do you get paid an hour. If you do not work, use $10/hr. (If you are salaried,
figure out your effective hourly wage). Multiply time by hourly wage. That is your labor cost. Remember all of the time spent (except eating). For restaurants,
that is commute and ordering time. For home prep, that is commute, shopping, cooking, and cleaning time.
For mileage, calculate number of miles drive by $0.56 which matches IRS guidelines.
Cost & Time – how does each alternative match up on a purely cost and time basis. Put data into a table.
Quality – how do the meals match up on appearance, taste, and quantity. If anyone shared the meal with you, what was their reaction.
Outsourcing v. Insourcing Research & Analysis:
Find six articles (from business publications) that discuss insourcing and outsourcing. Three articles for outsourcing and three for insourcing.
Do you agree or disagree with the conclusions in the article?
What do the authors consider to be the most important considerations in outsourcing and insourcing? Did you consider these points in your analysis?
Summarize what you learned from each article. (Cite all six sources using APA format).
Powerpoint or Prezi Presentation Deck (summary of findings):
Introduction & Overview
Cover each of the areas discussed above.
Which option is the best (restaurant v. home-cooked). Why?
Assess time, cost, and quality.
Were your findings consistent with the conclusions of the articles you researched? Where were did they differ.
Conclusion: what specific resource management lessons did you learn from the project concerning managing resources internally or externally.
Selfies and receipt photos.
Be creative. Use audio and video to make the presentation come alive.
Report & Analysis: 8-10 pages, single spaced.
Internal v. External Costs
Outsourcing v. Insourcing Theory Research & Analysis
Selfies and receipt photos.