By Andrew Kornuta — 06 Jan 2026

Industrialist Paper No. 4

The Latency Tax

A buyer can do everything “right” and still lose weeks.

The drawing is approved. The budget exists. The part is needed to keep an assembly moving. The buyer sends an RFQ and waits. While they wait, nothing else can lock: material release, tooling allocation, fixture planning, inspection planning, test planning, schedule reservation. This is as applicable in textiles as it is in machining. The mechanism is the same.

When you’re building, time is not neutral. Time multiplies cost. That multiplier is the latency tax: the price you pay when a work package cannot move through the network quickly enough to convert intent into a committed plan.

Latency is where schedules die

Every manufacturing program has a decision chain. Quote. Award. Material. Schedule. Work instructions. Inspection plan. Ship. If the quote slips, the whole chain slips. If clarification slips, the quote slips. If supplier qualification resets, clarification slips.

Anyone who has lived through a line stoppage understands this instantly. The numbers get ugly fast. One Senseye study of large multinational industrial companies reported average downtime costs on the order of hundreds of thousands of dollars per hour, with automotive plants cited far higher in some cases. Another source summarizing Aberdeen Group research puts unplanned equipment failure at roughly $260,000 per hour on average, with large industrial operations facing materially higher figures.

A buyer does not need those exact numbers to be true in their factory for the argument to hold. They only need one fact: once a build is waiting on a part, time stops being a soft cost. Latency becomes a financial instrument. It converts calendar days into expediting, overtime, rescheduling, partial builds, and risk.

The buyer’s experience: “Nobody can move fast.”

Buyers often describe the problem as “lack of capacity.” The lived experience is silence, followed by late quotes, followed by award pressure. Here is a plain anecdote that shows up constantly online. A buyer asks why quotes take so long. The replies are the same themes: too many RFQs, too much ambiguity, too much unpaid engineering, too many “tire kickers,” too much context trapped in people. That thread is not an academic study but we’ve all heard it and it mirrors what procurement teams see at scale: when the inbox is noisy, response discipline collapses.

From the buyer’s side, the result is predictable:

A quote that arrives late feels like no quote at all.
A supplier who responds late gets treated as unreliable, even if they are skilled.
A supplier who asks questions gets treated as “slow,” even when the questions are the difference between a clean build and a quality escape.

So buyers do what rational buyers do. They shrink the vendor list. They route to incumbents. They route to whoever answers first. They lean on channels that feel fast. Paper 3 covers the offshoring escape valve in depth, so we will not re-litigate it here. The key point for this paper is simpler: when time becomes the dominant objective function, the network selects for speed signals, not for real capability… and that can lead to real pain later.

The shop’s experience: latency is unpaid labor

On the supplier side, the buyer is not waiting on “a quote.” The shop is absorbing translation work. Every RFQ carries hidden decisions that must be made before a price can be real:

What controls, model or drawing, and which revision is correct.
What the datum scheme implies for fixturing and inspection.
What the finish callouts imply for process steps and verification.
What tolerances imply for scrap risk, yield, and inspection cycle time.
What certification chain and documentation burden are expected.
What assumptions are safe versus career-ending.

That work is not free. It is estimator time, programmer time, process planning time, and quality planning time. Even in a mature niche like moldmaking, an industry association report cites quoting turnaround on the order of days for many shops, alongside broader capacity and workforce constraints. The exact number varies by process and complexity, but the underlying reality is stable: quoting is part of production. It consumes scarce engineering attention.

So the shop also behaves rationally:

It triages aggressively.
It deprioritizes ambiguous packages.
It prioritizes known buyers with predictable award behavior.
It responds fast only when the work package is legible enough to price risk without gambling.

This is the core diagnosis: quote latency is not a single company problem. It is an emergent network problem created by ambiguity, qualification friction, and inconsistent incentive signals.

Time-to-clarity beats time-to-quote

Most sourcing conversations obsess over “time-to-quote.” The real bottleneck is time-to-clarity.

Clarity means the work package has enough explicit structure that two competent teams will converge on the same manufacturing contract:

The controlling artifacts are defined.
Critical features are identified.
Inspection expectations are explicit.
Acceptable assumptions are stated.
Revision control is stable.
Special processes are named.
Responsibility for ambiguity resolution is clear.

When time-to-clarity is short, time-to-quote becomes short as a consequence. When time-to-clarity is long, time-to-quote is a mirage. A fast quote on an unclear work package is often a deferred problem. The risk shows up later as change orders, rework, NCR churn, and schedule damage.

This is why “instant” is not inherently good or bad. Instant quoting is a tool. It is powerful when the work package is bounded and honest, and when the supplier identity and constraints are real. Instant quoting is destructive when it becomes a mechanism for exporting ambiguity into a part number and hoping the consequences land somewhere else. <<for more on “instant quoting” see bonus Paper No 4.5 below>>

Latency compounds because it stacks

Latency rarely shows up as one big delay. It shows up as a stack of small delays that cascade: the buyer waits for a first response, the supplier asks for clarification, the buyer routes questions to engineering, engineering responds late because the question is non-urgent inside their queue, the supplier updates the quote, procurement starts internal approvals, the supplier’s schedule window closes, the buyer expedites or reroutes, and the program slips anyway. This cascade is why manufacturing feels slow even when machines are fast. The speed of a spindle, a loom, or a pick and place line is not the constraint. The constraint is how fast the network can turn an unclear request into a committed traveler, router, or work instruction set.

Latency is also a governance signal

Incentives and measurement drive allocation. Visibility governs where the work goes. If the dashboard rewards award date and promised lead time, the system will select for promises, not for stable execution, because promises are the easiest thing to produce on schedule and the hardest thing to audit in the moment. Buyers unintentionally train the supply base when they reward speed without enforcing clarity and consequence. Questions that prevent scrap and NCRs get treated as friction, ambiguity gets broadcast as if it were demand, and then the actual award happens privately to the incumbent who already knows the tribal context. Suppliers learn the lesson fast: the channel is noisy, questions are punished, and the only way to survive is to either ignore most requests or pad risk into price. Shops unintentionally train buyers too. If there is no immediate “received and triaging” signal, buyers assume the supplier is unresponsive and route elsewhere. If questions sit with no updates, buyers treat the supplier as unreliable even when the supplier is doing real engineering work. If uncertainty is hidden inside price padding instead of stated as assumptions, the buyer cannot compare quotes honestly, and the argument resurfaces after award as change orders, lead time re-openings, and schedule fights. The network outcome is predictable: everyone optimizes for what is visible, not for what is true. Networks that outperform do not win by hoping for better behavior. They win by making response discipline, revision control, and assumption handling explicit, measurable, and consequential, so speed comes from clarity rather than from bluffing.

What a serious buyer measures

If you want a sourcing network that is fast and reliable, measure the things that create real speed:

Time-to-first-response: acknowledgement that the packet arrived and is being triaged.
Time-to-clarity: time from RFQ receipt to “we can build this without guessing.”
Question quality: are supplier questions pointed and bounded, or chaotic and late.
Quote confidence: explicit assumptions, explicit risks, explicit inspection plan.
Award discipline: how often RFQs become real POs, and how quickly.
Change order rate: percentage of awards that mutate because intent was unstable.
On-time delivery and yield outcomes: the scoreboard that matters after award.

Most of these metrics are not “nice to have.” They are throughput controls. When they are visible, incentives shift.

Implications

The dominant cost in modern manufacturing is often decision latency. Note: This can exist in a fully-vertical organization or across a distributed network of players.
Buyers experience latency as “no capacity,” suppliers experience it as unpaid translation work.
Time-to-clarity is the real lever. Fast quotes that defer clarity usually convert into later schedule damage.
Latency compounds through cascades of small delays across engineering, procurement, suppliers, and quality.
The governance layer is measurement. If you measure the wrong things, the network optimizes the wrong things.

Next: Paper 5, Ambiguity Lives in People, why the “irreplaceable” veteran is often a walking ambiguity reducer, and how buyers and suppliers can convert tribal context into routable work packages without turning every job into a folklore project.

BONUS: Paper No. 4.5 - Why don’t we all just use INSTANT QUOTING?!?!

Everything we talked about above implies that latency is a huge issue. It is. So why not just turn to an “instant quoting” system? Bottom line; they only “fix” a specific slice of manufacturing demand: clean inputs, well-bounded processes, and decisions that can be made without a human doing deep interpretation. And unfortunately they’re often coupled with an anonymous shop lock-in. They really don’t fix the issues mentioned above, they just move them around:

Instant quoting depends on structured geometry, not reality. The Instant Quoting Engine is built around uploading 3D CAD models for instant pricing and lead times. Drawings can be attached, but the “instant” part is driven by the model and selected options, not by a full human reading of every note, datum scheme, and implied inspection plan. This has to be right. The instant quote platform holds you to it. If you send the same rigor of a model to any shop you’ll get a fast quote.
A lot of work is not actually “instant-quotable.” Some processes are explicitly handled on longer cycles (example: injection molding is called out as manually quoted in 24–48 hours on the guide for one of the biggest instant quoters, not to be named), and high-volume, complex, or ambiguous packages tend to pull humans in.
There is still an engineering gate after you click buy. Some of the instant quoters describe a post-order review by their engineers and then assignment to a manufacturing partner. That is useful, but it also means the “quote” is not the same thing as a shop-owner reading your whole packet and owning the assumptions end-to-end from day one. Accountability shifts and communication drops.
Many buyers want supplier determinism, not “network assignment.” For programs that care about repeatability, traceability, PPAP-style expectations, or “same supplier, same process window,” buyers often prefer a direct supplier relationship where they control the exact shop, the exact inspection approach, and the escalation path.
Compliance and data handling constraints can narrow the field. The big instant shops support things like ITAR-related restrictions and have ITAR-registered quality labs, plus published security posture (including references to CMMC Level 2). That helps, but many OEMs still have internal policies that push them toward direct NDAs, approved vendor lists, and tightly controlled technical data flow.
Offshore routing is often bundled into the “speed/price” promise. Instant quote networks and offerings include global sourcing options and “economy” style levers that can reduce cost or shift lead time, which is attractive when the objective function becomes “get a part moving now.” That is also exactly why some teams avoid it when domestic-only and/or IP protection is non-negotiable. Quality, IP, and shipping issues add up fast here.
Unit economics and negotiation. For larger repeat buys, buyers often want price breaks, capacity reservations, tooling amortization logic, and negotiated change-order rules. Market-style quoting is great for fast procurement, but it is not always the cheapest or most controllable path for sustained production.

Net: Instant quoting can be genuinely useful for prototypes and many bounded parts. It does not eliminate ambiguity, qualification, and accountability problems across the whole network. It routes around them when it can, and when it cannot, humans and policy show up again.

Citations (Paper 4)

[1] Siemens Senseye. “The True Cost of Downtime 2024.” PDF report. (Accessed 2026-01-05)
https://assets.new.siemens.com/siemens/assets/api/uuid:1b43afb5-2d07-47f7-9eb7-893fe7d0bc59/TCOD-2024_original.pdf

[2] Institute for Supply Management (ISM). “The High Cost of Downtime: Data-Driven Strategies to Keep Your Operations Running.” (Accessed 2026-01-05)
https://www.ismworld.org/supply-management-news-and-reports/news-publications/inside-supply-management-magazine/blog/2024/07/the-high-cost-of-downtime-data-driven-strategies-to-keep-your-operations-running/

[3] Reddit, r/CNC. “Job quoting troubles...” (May 2018). (Accessed 2026-01-05)
https://www.reddit.com/r/CNC/comments/8jcyiz/job_quoting_troubles/