This weekend the New York Times published a story about the ongoing criminal trial over the 2008 crane collapse in NYC that killed two people. In brief, the crane owner, New York Crane and Equipment Corporation, needed a critical part manufactured to repair the crane and the owner found quotes from US-based companies to be too expensive; he then instructed an employee to find a cheap solution, leading the company to hire China-based RTR Bearing to manufacture the needed bearing at a comparatively low price. But during the trial, some troubling truths were revealed:
- Joyce Wang, RTR’s owner, claimed to have two factories. In fact, she was an agent who liaised with independent factories.
- RTR’s website claimed RTR had been operating since 1998. In an affidavit for the criminal case, Ms. Wang stated that the company had only been operating for six months when they were contacted about the crane part in 2007.
- RTR provided no references about their prior work to New York Crane and Equipment Corporation.
- Of the two parts RTR shipped to New York Crane and Equipment Corporation, one was deemed too defective for use upon receipt.
Notably, New York Crane and Equipment Corporation did not have anyone experienced in sourcing working on this project. The entire research-to-installation cycle was handled by a mechanic working for James F. Lomma, the company owner.
The tragedy highlights problems that sourcing professionals face often: ascertaining supplier company credentials and ensuring quality control can be difficult, especially when using company-provided information to do it. Top-level assessments of a manufacturer’s history and production levels can be made with services like Panjiva, but that is only the first step. These are real problems that require experience and attention, as well as comprehensive product assessments and quality control procedures, to deal with properly. They don’t—and can’t—afford shortcuts.
