The hidden costs of offshoring

18.04.2006

Yikes! Turns out, the machine had been running so much faster than the rest of the assembly line that the manager had to slow it down. He had slowed it down all right. He had fried the PLC by fooling with the input voltage, bringing the machine to a screeching halt.

It took about 60 seconds to hard-code the proper speed change into my spare PLC and another couple of minutes to install it. (They're designed to swap in and out quickly.) Next, I showed the guy the right way to adjust the speed of the machine, by adjusting a tension pulley designed for that purpose. Then I was on my way back to the airport, where I prepared an invoice for over US$25,000 in service fees, travel expenses, and replacement parts while I waited for my flight to board.

We never heard from that customer again. But when I read about the current controversies over outsourcing, I find myself wondering if that company's CFO ever figured out whether skimping on training was really saving the company money. I mean, after he factored in those $25,000 service calls.