The Make/Buy Decision - Decision Trees and Outsourcing

Software engineering managers face the make or buy decision. The make/buy decision is based on following conditions during the final analysis. These conditions include:
- Whether the software product is available sooner than the internally developed software?
- Whether cost acquisition + customization < cost of software development internally?
- Whether outside support cost < internal support cost?

Decision Tree
Suppose X is the decision tree of a software based system. Three cases derive:
- building X from scratch.
- reusing the existing components to construct X.
- buy software from market and make the necessary changes.
- get a vendor and and hand him the software development.

If X is built from scratch, chances are 70% that job is difficult. In a decision tree, different paths are taken and the projected costs for reuse, buy and contract are evaluated. Based on the output, the probability and projected cost is the lowest when we buy the software from the market.

during the decision making process, there are many criteria to be considered and not just the cost. Factors like availability, experience of developer/vendor/contractor, local politics, conformance to requirements and likelihood of change can affect the final decision to build, buy or contract.

Outsourcing
Outsourcing decision is basically a financial one. The way in which the software and systems that we need at lower price is outsourcing. It is a simple concept. All the engineering activities are handed over to the third party who is responsible to complete the work at low cost and most probably good quality.

At strategic level, decision of outsourcing is based on the fact whether a significant portion of all software work can be contracted to others. At tactical level, decision of outsourcing is based on the fact whether a part or all of a project can be accomplished by sub-contracting the software work.

Advantage of outsourcing:
Cost savings are achieved by reducing number of people and facilities that support them.

Disadvantage of outsourcing:
The company loses some control over the software that it needs.

Hierarchical or Tree Network Topology

In its simplest form, only hub devices connect directly to the tree bus, and each hub functions as the "root" of a tree of devices. This bus/star hybrid approach supports future expandability of the network much better than a bus (limited in the number of devices due to the broadcast traffic it generates) or a star (limited by the number of hub connection points) alone.
This type of topology suffers from the same centralization flaw as the Star Topology. If the device that is on top of the chain fails, consider the entire network down.Obviously this is impractical and not used a great deal in real applications.Each node in the network having a specific fixed number, of nodes connected to it at the next lower level in the hierarchy, the number, being referred to as the 'branching factor' of the hierarchical tree.

- A network that is based upon the physical hierarchical topology must have at least three levels in the hierarchy of the tree, since a network with a central 'root' node and only one hierarchical level below it would exhibit the physical topology of a star.
- The total number of point-to-point links in a network that is based upon the physical hierarchical topology will be one less than the total number of nodes in the network.
- If the nodes in a network that is based upon the physical hierarchical topology are required to perform any processing upon the data that is transmitted between nodes in the network, the nodes that are at higher levels in the hierarchy will be required to perform more processing operations on behalf of other nodes than the nodes that are lower in the hierarchy. Such a type of network topology is very useful and highly recommended.