Problems With Outsourcing

Boeing's vaunted new Dreamliner aircraft have all been grounded, with no prospects for flying again until its battery problems are solved.

Just an unforeseeable problem? Not according to New Yorker's James Surowiecky.

In a recent article, Surowiecky lays the problem at the feet of Boeing's bean counters.

This sort of thing has happened before in American industry. When General Motors was taken over by accountants instead of engineers, this started a long decline in quality which eventually drove the company to bankruptcy.

W. Edwards Deming, whose management techniques were adopted by Japanese auto manufacturers in the 1950's, had no problem with outsourcing. But he did have a problem with outsourcing based price. He especially did not like short term contracts with multiple suppliers, a particularly favorite of bean counters.

We have outsourced government functions, prisons, military operations, etc. all under the illusion that this will save money.

In Boeing's case, it demonstrably cost money. And reduced quality.

The whole approach needs another look at all levels of government and industry.