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Comment by JumpCrisscross | Hacker News Reader

> they own their factories in China

This isn’t as protective as one would imagine. Unscrupulous floor managers will still swap materials, run the crap and sell the good stuff.

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Wow. How would floor managers benefit from that kind of swap?

They sell the higher spec ones on the side to their buddies?

Wouldn't the lower spec ones fail QA checks on factory floor?

Not if the floor manager controls the factory floor QA checks...

If factory owners really want integrity from software-executed QA checks, they can require HQ authorization of software and config updates on factory floor equipment that is equipped for local tamper detection of control planes.

And as the other posters tell you, possibly failing QA checks is not stopping profiteers from attempting these kind of changes. Constantly. It's a numbers game. Expected profit based on how long until your swap is discovered.

By pocketing the difference.

Ah, pocketing the delta on input costs. Hopefully the drop in output QA metrics would be detectable via software.

You also need to make sure QA is actually on your side, and vigilant.

As they say, heaven is high and the emperor is far away.

Same way it happens outside china in other industries. You know a supplier who sells material / service for $BUDGET minus X, in exchange for swapping the PO you get a portion of X from the supplier via back channel means, while company is now paying $BUDGET for lower quality material / service that costs supplier less.

Because the factory manager is the one selling product out the back door.

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