A quadrant approach classifies all Postal Service purchases into four categories, depending on their impact on the Postal Service’s core competencies (noncore versus core) and complexities (standard versus custom). Attributes of certain quadrants may cause a propensity for outsourcing over making in-house or vice versa.
Figure 1.11
Four Quadrants
Products and services in this quadrant require customized attention, but do not provide direct value to the end client. A potential opportunity exists to take advantage of suppliers’ specialized knowledge and research.
Products and services in this quadrant are highly unique and specialized. External suppliers may face challenges in meeting quality specifications on a consistent basis; making the item in-house would seem to assure quality and lower risk. However, strategic concerns and resource limitations may justify buying from established and innovative suppliers. Further cost/benefit analysis is recommended to finalize the make vs. buy decision for products and services of Quadrant II.
Products and services in Quadrant III are fairly standardized and available from a wide pool of suppliers. Suppliers may have a more effective and reliable process for producing the requirement than the Postal Service.
Products and services in this quadrant are central to Postal Service operations and fairly uniform in their makeup. They often have significant impact on reducing cycle time, a key strategy for gaining competitive advantage. The impact on cycle time and business continuity is an important consideration of the make vs. buy decision. Further cost/benefit analysis is recommended to finalize the make vs. buy decision for products and services of Quadrant IV.
