Design your models to answer these “make or buy” questions, keeping in mind that the expected life of a rotary combustor is approximately 25 years and TMS would like to support these units throughout their life cycle. State any assumptions that you believe are necessary to estimate cost and risks. Discuss the sensitivity of your results, assumed parameter values, timing of cost, levels of risk and so on.

Your plan for the prototype rotary combustor have been approved. Total Manufacturing Solutions (TMS) management is now weighing the possibility of investing in a plant for manufacturing the combustors. There is a feeling, however that the degree of subcontracting associated with producing the prototype may not be appropriate for the repetitive manufacturing environment of the new plant.
Your group has been request to perform an LCC analysis to help determine which parts and components of the rotary combustor to manufacture in-house and which to buy or subcontract. Design your models to answer these “make or buy” questions, keeping in mind that the expected life of a rotary combustor is approximately 25 years and TMS would like to support these units throughout their life cycle. State any assumptions that you believe are necessary to estimate cost and risks. Discuss the sensitivity of your results, assumed parameter values, timing of cost, levels of risk and so on.