1-16.1 Strategic Considerations

A product or service meeting the following conditions is considered strategic:

• It is critical to customer satisfaction.
• It requires specialized design and manufacturing skills or equipment, and the number of capable and reliable suppliers is extremely limited.
• It falls under existing Postal Service core competencies or within those that must be developed to fulfill future plans.

Products/services that do not meet these conditions are considered nonstrategic and should always be outsourced unless compelling tactical reasons indicate that outsourcing would compromise best value to the Postal Service.

A strategic product/service requires further analysis before one can decide whether to make or buy from a strategic standpoint. Specifically, if the strategic product/service can be broken down into families of components and parts that are also strategic, it should be made in-house. On the contrary; if it is not divisible or its components or parts are not strategic, it should be outsourced.

Figure 1.10

Analyzing Strategic Make vs. Buy Decisions

* Note: In some cases, it is not possible to make an item in-house in the short term. This may be the result of budget
constraints, capability problems, capacity limitations, etc. In these cases, the item must be outsourced.