On the one hand, there's the dirty little secret of offshoring-those hidden costs. On the other, there’s the old adage that an ounce of prevention is worth a pound of cure.
On the one hand, it’s the dirty little secret of offshoring-those hidden costs. Currency exchanges, time zone differences, language issues, lag times for shipping, customs: The cost of “cheap” overseas labor can often be a lot more than it appears.
On the other, there’s the adage that an ounce of prevention is worth a pound of cure. This is especially true when it comes to training one’s workforce. What some regard as an expense is, in fact, an investment that can yield big dividends down the road.
Both of these points were driven home in a recent press release distributed by veteran factory automation and equipment manufacturerAutomation Tooling Systems Inc.(ATS-Cambridge, Ontario).
Not too long ago, ATS receiveda panic phone callfrom a customer that had installed one of its systems in a plant “halfway across the world.” Apparently, the production line at this highly automated plant was down, and operators couldn’t figure out how to get it running again.
Worse yet, the plant’s products were “integral” to the success of yet another plant in North America-a truly critical problem. The company needed someone from the ATS service department to fix it immediately.
Of course, we’re talking about a country halfway across the world, where not everyone speaks English, sotwopeople had to jump on the next flight, the machine builder and a technician who could also function as a translator.
To make a long story short, after arriving at the plant, as the technician was questioning the operator in charge of the machine, the builder did a little poking around on his own. Spotting a switch in the wrong position, he flipped it over to where it belonged, the system sprang to life and they were back in business. Total cost of the “repair”-$20,000.
Imagine how different things would have been if the plant had been within driving distance. Heck, if it had even been within three or four time zones! Then again, imagine how much easier it would have been if the customer had invested a little more time, effort and funds in training upfront.
Thankfully, snafus like this one are rare. But then again, how many less dramatic problems and inefficiencies-production “hiccups”-take place regularly at a typical plant? How many machines out there are being used incorrectly? How many systems are failing to fulfill their potential? Imagine how much money is lost this way in the course of a year. Imagine how much greater these inefficiencies can become and how much harder they are to detect and resolve when they are happening on the other side of the planet.
Offshoring has its place, but companies should think long and hard about what they are giving up before they send their work off to be done by someone else. And when they do, the urge to cut costs shouldn’t including cutting corners. The result can be some highly unpleasant late-night phone calls. Murphy’s law can pack a powerful punch.
The Lessons of a $20,000 Switch
By Adam Cort