There are always billboards on I-95 advertising cheap Lasik eye surgery. While I have terrible eyesight, if I ever decided to have surgery, I certainly wouldn't want to make the decision based on the best bargain. I want anyone who operates on my eyeballs to be an expert. And experts cost money.
The desire to save money, however, is strong. And you don't want to pay more than you have to. But when lives are on the line, you really should think about the value you are getting for your money.
Bloomberg discovered that Boeing hired engineers for as little as $9 an hour to work on their new Boeing 737 Max. .This plane has had two deadly crashes and the aircraft were grounded until these problems can be solved.
Mark Rabin, a former senior engineer who was laid off from Boeing in 2015, told Bloomberg that his layoff was due to the belief that "Boeing didn’t need senior engineers because its products were mature."
Stop and think about this: We have a great product, so we no longer need experts in the field.
A senior engineer costs a heck of a lot more than the $9 an hour outsourced engineer. But, you get what you pay for. And while no one is coming out directly and saying "these planes crashed because the following underpaid team wrote crappy code" we have to consider that lesser skilled individuals will produce worse work.
I'm not arguing that you always have to hire the top person in the field. Most of the time, good enough people are, well, good enough. But, when you pay lower salaries, treat your employees poorly, or look to save money with every step of the way, you're going to end up with substandard work.
Paying market rates will get you qualified people. Paying below market rates, or trying to get junior people to do the work senior people used to do, will result in an inferior product, almost all the time. And if it doesn't, then those people have proven themselves and expect them to jump ship as soon as they can--why should they work for you at a lower salary when they are worth so much more?
Most likely, your company doesn't operate in the life-and-death sphere that Boeing does. No one is going to die if your new hairbrush fails to get the tangles out. But, trying to save money can often cost you money. Before you pay below market-rates, outsource, try to use interns for real work, or force your exempt employees to work 80 hours a week, stop and ask yourself if the expected payout is worth it. Or are you putting your product and even your customer's lives at risk?