Quality is paramount in the manufacturing industry and history is full of big mistakes due to the lack of attention to detail. Despite our best efforts, simple laziness is sometimes all that it takes to lose millions of dollars. Here are some incredibly expensive mistakes that a little more due diligence could have prevented.
- The Missing “P” Valued at Over $500K
In 2007, an antique bottle of Allsopp’s Arctic Ale was posted for sale on eBay. Unfortunately, the item, listed under the name “Allsop,” failed to attract the attention that it deserved. It sold for around $300, and the buyer immediately reposted it on eBay with the correct name – and wound up closing the auction for just over $500K.
- Roswell Honda Mails 50,000 Grand-Prize Tickets
We’re all familiar with direct-mail campaigns, especially those promoting local car lots. Roswell Honda published and mailed scratch-off tickets to 50,000 area residents, boasting a grand prize of $1,000. Unfortunately, every ticket printed was a winner. This typographical error cost the company thousands of dollars to correct, in addition to some extremely negative publicity.
- Mizuho Securities Grossly Undervalues Its Shares
Sometimes, typos are far costlier. This was certainly the case at Mizuho Securities, a Japanese brokerage firm, when it mistakenly posted over 600,000 shares for sale at 1 yen each instead of 1 share for sale at 610,000 yen. This amounted to an approximate loss of $225 million.
- 20th Century Fox Gives Licensing Rights to George Lucas
The film industry is a billion-dollar enterprise, and negotiations are a critical part of doling out money
among directors, writers, actors, producers, and studios. In this case, Fox grossly undervalued the potential of the Star Wars franchise and gave full licensing rights to Lucas, whose net worth exceeds $4.6 billion today.
- Multiple Explosions Rock the Streets of Guadalajara
More than 10 explosions devastated Guadalajara, Mexico, in 1992. The culprit? Zinc water pipes laid too close to steel gas lines. The steel corroded, and gas rapidly spread throughout the city’s sewers. This preventable oversight led to immense property damage as well as substantial loss of life.
- The Piper Alpha Oil Rig’s Missing Valve
A missing valve caused one of the deadliest oil-rig disasters in history. The part was removed but not replaced, and no one told the next shift about the safety valve. When the team used the pipework, there was a massive explosion. Legal damages alone amounted to over $100 million for Occidental Petroleum, the rig operator.
- The Soviet Union’s N1 Rocket
We called it the Space Race for a reason: Soviet engineers were in an incredible competition with the United States (and amongst themselves) to land on the moon. Unfortunately, limited resources, pressing deadlines, and nitroglycerine are a bad mix. One bolt on the N1 wasn’t tightened properly. The part was sucked into the engine, and the rocket plummeted back to earth.
- The Exxon Valdez Catastrophe
When the Exxon Valdez ran aground, it cost over $4 billion in cleanup expenses and reparations in addition to extensive environmental damages. Lax management, complacency, and insufficient regulations reportedly contributed to the calamity.These mistakes will always appear on lists of astounding catastrophes. What’s probably most incredible is that renowned corporations so frequently make such preventable errors. Whether millions of dollars are on the line or not, due diligence is always important.