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of serious concern to the Secretary, Mr. Forrestal. He established a committee of civilians to study, the Navy supply system and make recommendations. This committee made two recommendations:

First, that a single catalog system should be developed by the Navy for use by all the bureaus and agencies.

Second, a single stock control system should be developed for the Navy based on the single catalog system.

The end of the war found the armed services on their way to putting their catalog operations on a sound basis. However, a movement was initiated to again take from the armed services their authority to solve their own problems and vest it in civilian agencies or in a board, far removed from military supply. It should be of interest to this committee and to the Congress the methods that are being used to do this.

After the failure of the Federal stock catalog system, great emphasis began to be placed on a standard commodity classification code and this activity was combined with the activity to develop a standard commodity catalog. The same emphasis was placed on high level boards and committees that had characterized and developed over the past 35 years with little attention given to the methods by which the catalog and supply operations would be geared together. Much was said about the need for a statistical tool and little about moving supplies.

In 1947, Congress reviewed a request for $2,700,000 to continue the catalog activities of the Bureau of Federal Supply. By that time it was clear that little or nothing of value was resulting from the sizable sums that had been spent for the Federal stock catalog system. In denying this request, it was the intent of Congress that these activities should close. Instead they were merely transferred to the Munitions Board of the National Military Establishment by having the Navy reimburse the Treasury Department for the sums that the Treasury Department used to continue to pay the salaries of their catalog personnel

. This group from the Bureau of Federal Supply became the key personnel of the Munitions Board cataloging activities. One of their first projects was to engineer an agreement between the Munitions Board and the Bureau of Federal Supply by which the Bureau of Federal Supply placed representatives on the executive committee of the Munitions Board in addition to the personnel who had been transferred from the Bureau of Federal Supply.

If there is any question that the Munitions Board cataloging agency program is the same that has been attempted for 35 years and that caused so much trouble during the war the Hoover Commission states (reading]:

The system adopted by the agency thus far is in substantial conformity with the system developed by the central staff and technical committee at the Bureau of Federal Supply for the United States Standard Commodity Catalog Board.

What has been the result? Practically none. The activities of the Munitions Board cataloging agency were initiated in July 1947 and little has been accomplished. The Hoover Commission points out that in the first year of the Munitions Board cataloging program, a 3-year program starting in July 1947– has already been revised to a 4-year program dating from July 1, 1948.

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It should be of interest not only to this committee but to the House Appropriations Committee that these abortive efforts are costing over $100,000,000 for the years 1947 through 1950. Past experience has shown that a catalog system suitable for both the armed services and the civilian agencies could have been developed and placed in operation in the time that the Munitions Board program has been under way and at about half the cost. The Hoover Commission report states [reading]:

If the necessary authority is properly vested and is exercised, a Federal commodity catalog can be completed and put into use for much less than has been spent in past years on scattered effort. The 5-year program and budget estimate presented to Congress, under the aegis of the United States Standard Commodity Catalog Board in July 1947 was predicated upon a total cost for preparing and publishing the catalog of a little more than $56,000,000.

Thus it is seen that the provisions of section 107 of H. R. 2781 is an attempt made to perpetuate a policy that not only is not in conformance with the wishes of this committee but which after the expenditure of vast sums to implement has probably been the chief reason why needed reforms in the supply systems of the Federal Government have not been instituted.

The House Armed Services Committee and the Hoover Commission before attempting to make recommendations have tried to determine the reasons why there has been such a lack of success over such

a a long period of a program which the experience of the armed services during the recent war indicates is not difficult. The Hoover Commission report states (reading]:

To explain why the preparation of the Federal commodity catalog has been so long delayed, the following hypotheses are offered :

(a) A uniform catalog system, when applied to supply operations, means that all existing catalogs with their numbers, names, and descriptions will be replaced. This naturally engenders great and stubborn resistance from supply officials to the taking of action that will lead to changes in purchasing, storing and other supply processes—wbich would follow the development and use of the Federal commodity catalog.

(b) The absence of glamor and front-page-news qualities in such highly technical matters as item identification, classification, description patterns, alphabetic indexes, munibers, and symbols. It is, as a consequence, difiicult to convince the policy-determining officials of the extreme importance of a standard commodity catalog to efficiency in supply operations.

(C) Inability or unwillingness of the several interested agencies and their technical staffs to reach decisions and to agree on the basic elements of a catalog system.

(d) The lack of badly needed congressional action.

Then the Hoover Commission makes these recommendations: The present program of the Munitions Board cataloging agency would, howerer, move ahead more rapidly with the removal of a number of serious defects in organization and methods, which can be accomplished as follows:

(1) The agency should have an adequate, permanent staff and be financed from the budget of the unitions Loard; as long as it has to rely upon allocation of funds from the three constituent departments of the National Military Establishment, it will not be able to operate as an impartial and uninhibited group;

(2) The Secretary of Defense should, in terms which are unmistakable, serve notice on the bureaus and technical services that a standard catalog shall be speedily prepared and adopted ; after its preparation, that it must be used in all supply operations of all bureaus and technical services without modification; and that each bureau and technical service must assist in the preparation of the catalog by accepting and promptly completing cataloging "assignments" by the agency in whatever commodity classes it is made the cognizant body; and

(3) The organization should be radically simplified. The Secretary of DeBy pro

fense is now separated by seven strata of authority from the civilian staff to whom are assigned the technical details. If the staff seek top-level approval of a phase of cataloging operations, or of a budgetary request, it must have clearance by the executive group, by the technical group, by the agency group, by the procurement section, by the procurement policy council, by the executive committee of the Munitions Board, and by the Board itself, before it reaches the Secretary of Defense and his immediate staff. Although an extreme example of the channels of authority in Munitions Board operations, it illustrates a general situation. Simplification can undoubtedly be achieved ; and it must be, if this undertaking, universally recognized by military authorities as of crucial importance to national defense, is to be completed and made effective within the work schedule of 4 years.

With these recommendations in mind, I have introduced a bill, H. R. 321, entitled "The National Defense Catalog Act." I am taking the liberty of attaching a description of this bill that appeared in the January 10, 1949, Congressional Record. This bill assigns to the armed services the authority and responsibility for developing a catalog system to meet the needs of their military supply system. viding representation at both the policy and operating levels for other Government agencies and for industry, the catalog system may not only reflect the comparatively simple needs of the civilian agencies but shall be in conformance with civilian practices as far as possible without detracting from military needs.

Supply cataloging functions have been defined for the first time so that everyone will know the rules of the game.

. The general pattern of a catalog organization and system is described without attempting to limit the flexibility in setting up the detailed procedures.

Above all it provides that the Secretary of Defense shall have the same clear, unmistakable responsibility to develop the necessary tools to carry out his supply responsibilities that the National Security Act vests in him for supply of the armed services, without interference from other Government agencies, but within the framework of overall Federal policy. Only in this way can the Secretary of Defense be made accountable for the improvements in the supply procedures so much desired, not only by this committee, but by the Armed Services Committee and every Member of Congress.

Mr. Chairman, with the permission of the committee, I would like to insert in the record the statement to which I referred, which appears in the Congressional Record under date of January 10, 1949.

Mr. HOLIFIELD. Without objection that request is granted. (The statement referred to follows:)

THE NEED FOR A SINGLE SUPPLY CATALOG FOR THE ARMED FORCES

Mr. Speaker, the bill entitled “National Defense Catalog Act," or H. R. 321, may be the key to unication of the services that the Congress prescribed in the National Security Act of 1947. It could be used as a pattern for the manner in which all the functions performed by the services may be organized and handled and it so affects every other operation of the services that in solving this single problem the way is open for the solution of many others.

When a log jam blocks the movement of logs down the stream, keen eyes search the log jam for the key log. When this is dynamited out, the log jam is broken and the logs resume their steady course down the stream.

Passage of H. R. 321, by solving the supply catalog problem, will remove the key obstacle that has been holding up unification.

Among other things the bill provides for the following:

The Secretary of Defense is directed to establish a single supply catalog to be used by all units of the National Military Establishment and is empowered to:

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issue the necessary directives to the services to see that this is done. Apparently the National Security Act is lacking in this authority.

The Secretary of Defense is authorized to delegate this authority to the Chairman of the Munitions Board who is directed to assign this authority to a single competent person, a Director, who shall report directly to the Chairman. This eliminates the "administration by debate" that is hamstringing the entire Military Establishment. The qualifications of the Director should be carefully considered. A big name or a brass hat will not achieve a workable catalog system; that has been tried in the past. What is needed is a man having a knowledge of industry, of military supply and cataloging, and who, if possible, is an engineer. Perhaps the appointment of the Director should have the approval of Congress.

Under the Secretary of Defense and the Chairman of the Munitions Board the Director will be responsible for establishing all policies and for seeing that all operations pertaining to cataloging are carried out properly and efficiently.

A National Defense Catalog Agency is established within the National Military Establishment on the staff of the Chairman of the lunitions Board whose organization shall be determined by the Director.

Cataloging is defined for the first time. At the present time every unit of the National Military Establishment has a different idea of cataloging. This is about the same situation that would result if the term "widgeon" meant to one person five elephants, to another one cow, to another a flock of geese, and so forth. It is almost impossible to discuss over-all cataloging in the services because of the confusion as to terms and definitions.

As in any well-run organization, the top staff will establish policies and procedures and resolve differences arising in the operations units.

All operations are to be delegated to operations agencies to be established with the approval of the Secretary of Defense in the supply services and bureaus or in any common supply agency established by the Secretary of Defense, such as the Army-Navy Procurement Agency. The head of such operating agency will be appointed with the approval of the Director of the National Defense Catalog Agency and will report only to the head of the supply service or bureau. This is extremely important because catalog operations, if they are to be of the greatest service to supply operations, must be carried on so that both appear to be one great operation. If it were possible for desks of the two men charged respectively with supply and cataloging to be placed next to each other, the maximum efficiency and economy would be achieved in supply operations. One of the principal reasons for the failure of catalog operations carried on by the Government has been the separation of supply and catalog operations.

To insure that the policies and schedules of cataloging are coordinated within each department, the Secretary of the Army, Navy, and Air Force are directed to designate a staff officer whose sole responsibility will be to perform these functions and advise the Secretary as to the status of cataloging operations. This officer will not perform any actual operation; consequently he will not need a large staff.

One of the most important and far-reaching provisions is that which directs the head of the National Defense Catalog Agency to assign each item of supply carried on the records of any supply activity of the National Military Establishment to one and only one of the catalog operations group where all catalog operations will be performed on it, including identification, writing descriptions, establishing standards, and publishing the information in the catalog. This information when published will be used by all supply activities of the armed forces. Although the same criteria used to assign catalog responsibility could be used to assign procurement responsibility, no attempt is being made at this time to assign item-procurement responsibility. The benefits to be derived from establishing a single supply catalog system for the armed forces are so great that it is believed best not to attempt to assign procurement responsibility at the same time. After the catalog system is operating, it would then be comparatively easy to assign procurement responsibility.

In order to provide an incentive to the services to cooperate in the establishing of the catalog system, it has been directed that no item may be used by or procured for the use of the services unless the catalog agency has had a chance to analyze it and catalog it. The Director is empowered to determine after what period items cannot be used by or procured for the services until they have been cataloged. This will be done in such a manner as to prevent delay in supply operations.

An advisory council is provided whose representation includes the officers on the staffs of the Secretary of the Army, of the Secretary of the Navy and of the Air Force; also it includes representatives from industry, from other interested Government departments and perhaps from Allied Nations. This council will be purely advisory and will in no way detract from the responsibility of the Director. Additional specialized representation from industry, from other technical services or bureaus, or from other interested departments may be provided as an advisory committee assisting the head of each catalog operations division. Industry has yet another channel of contact through the inspection or quality control service.

With the authority to assign items and functions to catalog operating agencies, must go the authority to consult upon, advise, and approve the budget of any catalog operating agency before it is submitted to the budget officer of the department.

In this way I believe it is possible for Congress to assist the National Military Establishment in achieving unification, assist indutry by simplifying the multiplicity of Government specifirations and regulations, and above all, reducing the tremendous waste and inefficiency of military supply operations.

Mr. ANDERSON. Mr. Chairman, if there are any questions I shall be only too happy to try to answer them. Mr. HOLIFIELD. Mr. Blatnik, do you have any questions!

? Mr. BLATNIK. I have no questions. Mr. HOLIFIELD. Mr. Harvey ?

Mr. HARVEY. No, Mr. Chairman; I think I would much prefer to have some time to study and digest this very fine statement first.

Mr. HOLIFIELD. Mr. Bolling?

Mr. BOLLING. Do I understand your basic premise is that the defense needs of this country occupy a predominant place in our total national and governmental economy?

Mr. ANDERSON. That is correct.
Mr. BOLLING. In the foreseeable future?

Mr. ANDERSON. Oh, very definitely. Not only in war, but even in peacetime.

Of course, in wartime it just expands tremendously. Now, I have no particularly criticism of the services for duplication and waste which occurred during the war. We started almost from scratch, with our Navy at the bottom of the sea in Pearl Harbor, and our Army practically none, and we grew like a mushroom, and of course those mistakes and those duplications were bound to occur.

But now we can sit back and take an objective view of this situation, and let us make the corrections that are necessary so we do not again repeat the mistakes that might very well occur if we had another war.

I might say, Mr. Chairman, that I have here before me the Army. Navy catalog, the medical catalog, and I think the medical service is entitled to the committee's commendation as well as that cf the Congress for what they have accomplished. They are now 99 percent in conformity on the cataloging system. And the key to an efficient supply system is cataloging.

Of course, there is going to be resistance; we all realize that, but in my opinion you cannot have anything even approaching a single procurement system, a subject in which this committee is interested, until we get a single supply cataloging system, so that every item that is procured by any branch of the service is known by the same, exact designation number. Mr. HOLIFIELD. Mr. Anderson, I can assure you

that we

all

appreciate the time and effort you have given to this matter, and the fine statement you have made to the committee this morning. As Mr. Harvey has said, it will take some study on our part to really digest it, because it covers a very wide field, and it covers so many things

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