Beyond that, management and accountant types make the assumption that everyone with the same job title is interchangeable.  The result is that they take the work of local engineers with a substantial amount of domain knowledge (experience, which maps to higher salaries) and try to offshore it to engineers with no domain knowledge (inexperienced in the field of the application, and often inexperienced period).<p>Because of their assumption of interchangeability, they end up with a lose-lose model of costs.  For illustration, assume a (local) domain expert takes 1 hour to do a job and costs $100/hour.  Assume the outsourced inexperienced engineer only costs $33/hour, but takes 3 hours to do the same job because <i>first</i> they have to learn the problem domain.<p>When you outsource this job, it takes three hours and costs $99.  Doing the math, this means the company "saved" $201 because the assumption of interchangeability implies (incorrectly) that the domain expert would <i>also</i> have taken 3 hours.<p>When you "insource" the job, it takes one our and costs $100.  By the math, the accountants figure they left $67 on the table because the assumption of interchangeability implies (again, incorrectly) that the outsourced engineer would <i>also</i> have taken 1 hour.<p>The only way to win this game is to not play it.