Lesson 29 is where the engineering meets the money. The one thing every student must leave with: the business case is built from confirmed inputs, not from assumed labor numbers and not against an industry-standard payback that doesn't exist. If a student walks out ready to quote a three-year industry norm to a customer, the lesson didn't land. Run at least one payback live. A student who has computed a payback once understands it. One who only watched doesn't.
| Segment | Min | What happens |
|---|---|---|
| Open on Tom Ruiz | 6 | Read Tom's line cold: if it doesn't make financial sense he can't support it, regardless of the operational benefit. Ask the room what that sentence does to a technically correct design. Land the frame: the business case is engineering, not a sales flourish. |
| The three savings sources | 12 | Labor, error and chargeback reduction, throughput. Build the annual-savings number on the board from the three. Stress that throughput only counts where it converts to revenue or avoided overtime, and that every input is confirmed in writing before it enters the model. |
| Payback and the honest range | 16 | Simple payback is investment over annual savings. Run it live with an illustrative install cost and confirmed inputs. Then teach the tiered range and the anti-pattern: there's no industry-standard payback. Change the customer's threshold and ask the room what changes and what doesn't. |
| Price the outlier both ways | 16 | Run the with and without protocol on a real outlier. Show the two-column include/exclude view. Have the room put a number on carrying it, using a per-foot estimate where the design isn't drawn both ways. Make them name the manual exception path an excluded outlier requires. |
| Riverside model-build | 8 | Build Riverside's model structure against Tom's three-year threshold and write the ask-Tom list. See the Riverside facilitation note. Do not let them plug in a headcount. |
| Forest and close | 2 | Fold in the forest: six parts of engineering finally answer one plain-English question in the finance review. Close on the standard, build it from confirmed inputs. |
| Total | 60 | Baseline session. Add the stretch below for a 90-minute block. |
The cost-driver conversation is the Part II outlier seed grown up. A student who flagged the Small Case and the Large Case as outlier candidates back in Part II, and carries them here as priced options, has run the full workflow correctly. Name that out loud when it happens. That trace, from an early product-analysis flag to a priced business decision, is the whole program working as designed.
Run a payback live. Give the room an illustrative install cost and a set of confirmed labor and chargeback inputs, and have them compute simple payback on paper. Then change the customer's threshold and ask what changes. The savings don't move. The payback doesn't move. Only the pass-or-fail against the threshold moves, because the threshold is the customer's decision, not a property of the system.
Four failures show up in this lesson. Catch each one and push it back to confirmed inputs and the customer's own threshold.
Run Tom Ruiz as a role. When a student starts plugging in a headcount, stop them. Tom never gave you that number. Make them list exactly what they need to ask for: the number of associates on manual sorting and staging at peak, the fully loaded cost per position, and the chargeback cost per incident. The deliverable here is the model structure plus the ask-Tom list, not a finished dollar figure.
Then run the with and without options on the Small Case and the Large Case. The Large Case is the harder call, six percent of volume driving belt width, curve geometry, and system weight. Have the students defend, to "Tom," whether carrying the Large Case is worth the cost. Steer them to present the option and the cost and let "Tom" decide. Do not tell them. Ask. The move you're building is the one where the engineer holds the decision with the customer instead of taking it away from him.
Stop and think (the ask-Tom question). Ask Tom for the number of associates dedicated to manual sorting and staging during peak shifts, and the fully loaded cost per position, plus which positions go away versus get redeployed. You can't assume them because labor is the primary line in the payback. A wrong headcount or a wrong loaded cost swings the whole result, and an assumed number falls apart the moment Tom asks where it came from.
Checkpoint 1 (the 4-inch outlier). Recognize the 4-inch product as a cost-driving outlier at only 2 percent of volume. Price it both ways: what the system costs designed to convey the 4-inch reliably, tighter roller centers or a different conveyor type, against what it costs optimized for the core range with the 4-inch handled by a documented manual exception path. Use an early per-foot estimate if it isn't drawn both ways. Present the trade and let the customer decide. When: in discovery, early. A cost driver first surfaced at proposal review is a surprise, and surprises cost trust.
Checkpoint 2 (the 3.4-year payback). It's the wrong move because there's no industry-standard payback, so the claim is false, and the first finance person who knows better stops trusting every other number you brought. What to do instead: don't dress up the framing. Either close the gap honestly, by finding another confirmed savings line or reducing the install scope, for example excluding an outlier to lower the investment, or defend the 3.4 years honestly against their own threshold, showing the inputs and the value that keeps accruing past year three over the system's full equipment life. Confirm every input in writing. If it genuinely can't clear their threshold, that's the customer's decision to make with accurate numbers, not yours to disguise.
The payback model, the confirmed-input emails, and the priced outlier options are project-folder artifacts. A student who's kept an organized Riverside folder since Lesson 1 is building this business case out of documents they already have, the confirmed 20 CPM target, the misdirect rate, the product table, the outlier flags from Part II. That's the payoff of the folder habit landing in real time.
This business case slots straight into the proposal in Lesson 30. It becomes the executive summary and the cost-driver section. Don't tell the students that yet. Let them discover in Lesson 30 that most of the proposal's money section is already built. The students who kept the folder without being told why are the ones who feel it.