Top management of an IT company were concerned about the cost of maintenance calls – it cost twice as much to handle calls in Switzerland compared to handling them in Ireland. They made the decision to transfer all the Swiss calls to their Irish operations.

When the calls started coming in to Ireland technicians were unable to provide support – the Swiss customers had a bespoke IT system, used throughout Swiss retail sites – and it was unfamiliar to the technicians. Management then re-hired Swiss technicians and sent them to Ireland to help the Irish technicians learn how to service the calls.

If they had known about the nature of demand before they started they may have come to a less-costly solution.

Things like this happen all the time in command-and-control organisations, and simply because management’s view is limited to a cost-management view. Because management was focussed on costs, costs went up.