Subcontracting, Coordination, Flexibility, and Production Smoothing in Aggregate Planning (Classic Reprint)

By Brand : Morton Kamien

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Subcontracting is the procurement of an item or service which is normally capable of economic production in the prime contractors own facilities and which requires the prime contractor to make specifications available to the supplier (j. S. Day Despite a high degree of both vertical and horizontal integration, it is very doubtful whether any modern business enterprise can be self - sufficient in all its activities. Even ignoring the purchase of raw materials and the use of distribution systems to dispose of final products. Most companies appear to depend upon other producers for performance of at least. Some work and services. Reflecting the extent of this dependence, the extremely important. Role that subcontracting plays in industry has been recognized in the past few years as never before (sammet. And Kelley In particular, many observers (williamson I'iore and Sabel point out. That subcontracting is more extensively used in the industries and/or industrial districts (japanese tool makers, Italian textile firms, etc.) where manufacturing technologies have greater ?exibility. Because flexibility increases the feasibility of subcontracting while subcontracting helps to realize greater value of ?exibility.