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Comment by jayjay71 | Hacker News Reader

This article is wrong. The output per employee changed to 250%. So by reducing the staff to 10%, the total output is roughly 25% compared to what it was before.

http://monetarywatch.com/2017/01/chinese-factory-replaces-90...

edit: added original source courtesy of dmoy http://en.people.cn/n/2015/0715/c90000-8920747.html

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That doesn't make sense from a business perspective. No one would invest heavily with output expected to drop to 25% existing levels. More likely is that the factory's total output is 250% of what it was before the employee cuts.

Tech Republic says:

> According to the People's Daily, production per person has increased from 8,000 pieces to 21,000 pieces. That's a 162.5% increase.

I'm highly suspicious of the factual accuracy of anyof these news reports.

It's scary how quickly all "data" in articles suddenly seems to have gotten unreliable.

I hope this leads to a resurgence in journalistic integrity. I would gladly pay for news I can trust.

I'd argue that such hasn't suddenly become unreliable. It was always unreliable, it's now far easier to fact check (and frequently do so in exchange with experts in a given field, as happens so often here). Now you have a million eyeballs on the bogus claims / data, and those eyeballs frequently have fast, easy access to vast research sources.

Today if the President says something bogus, it'll be fact checked in minutes by a thousand people and that fact checking will be syndicated globally nearly instantly on a dozen large media platforms. By comparison, consider the process, access and distribution that existed at the time of FDR (the things you can get away with when it takes a week or a month for distribution to occur).

We have a lot of historical examples from the last two centuries, to show that data accuracy and reporting in terms of commerce, politics, military, journalism etc. were not particularly extraordinary in the past. Agenda, laziness, bad research, bad reporting, misinterpretation, etc. are nothing new.

There is that, but also there's been increasing pressure to pump out more faster due to more competition, and people paying less/nothing. I think quality-per-article has probably gone way down in the last decade, but we do have a ton more articles.

They are also paying less salaries, so depending on their margins they might be making more profit that way, which is the actual thing that counts and not output volume.

Exactly! Thats what people don't get!

You can even now charge more because the quality better now!

The future will be like: better sell ten iPhones for 10.000 than 100 for 1000.

Why?

Less support,less headache,less struggle to organise the production etc.

dang changed the article so now this comment thread is a little confusing. The original article incorrectly claimed that total production increased 250%.

Do you mean 25% higher?

If you read the original Chinese source, it's saying

Old: 650 workers * 8000pieces per person per month

New: 60 workers * 21000 pieces per person per month

It's a bit ambiguous but it makes it sound like total production output has dropped fourfold.

Even then, it's not telling the whole story without knowing the cost per worker and the value per unit. When you take costs into account, you can get a situation where lowering production will increase earnings.

Taking your numbers and plugging in some values like 75 per worker and 0.01 per unit would increase earnings by 250%.

and the cost of amortizing the new plant

Yea, I'm wondering if we can dig up a Chinese language source and see if it has more details. I'm guessing something got horribly lost in translation.

Or, possibly, the factory managers are purposefully not giving the whole story...

Previously they made 5.2 million pieces per month and now they make 1.26 million pieces per month.

Seems like a disaster to me!

If they reduced their workforce by 90%, so that the cost of labor is now a tenth of what it was, then they may have improved overall profit.

Of course, that doesn't include overhead, or anything else.

It it's an immediate decrease in output but they are planning on moving from 60 robots to 1000 robots in 2 years. so the 2 year expected capacity is 21,000,000 with a 5% defect rate vs. the 5,200,000 units with a 25% defect rate and wages/benefits for all those people.

All that matters is per unit cost. The rest is just a matter of scaling up.

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