The underlying principle of joint procurement has been proved sound in the crucible of fire during the World War. From this experiment it can be deduced that savings can be effected through Joint procurement by Army and Navy of items to be properly standardized and bought by a single agency, such as:
- Subsistence (especially "dry" articles)
- Clothing (especially underclothing)
- Ordnance and Chemical Warfare Service
- Construction (especially housing)
- Automotive
- Aeronautic
- Signal and electric (especially radio)
- Medical
Substantial savings can be effected also through the consolidation of purchasing offices throughout the country with consequent improved efficiency. Simplicity of organization is essential and the existing order, with certain modifications, can be made to serve.
The acid test for this problem is threefold:
- Can efficiency be maintained?
- Can savings be effected?
- Can the new organization be readily expanded in case of emergency?
This proposed plan answers in the affirmative. The organization would be:
- A general control board consisting of the two secretaries and the chief co-ordinator of the United States.
- A joint munitions board (now in existence) and a joint budget board.
- A general purchasing agency which would receive from the Army and Navy detailed specifications for purchases to be made.
- The organization of the office of the general purchasing agency and the regional offices would be by divisions of general classes of items rather than (as now obtains) of a heterogeneous mass of duplications owing to the jealous guarding of prerogatives by the various bureaus.
The advantages of this plan include:
- No new legislation necessary
- No disruption of present policies
- No drastic change of personnel
- No very complicated machinery
- Complete exchange of purchase information
- Determination of priorities and policy
- Ease of expansion in case of emergency
- Closer co-operation of Army and Navy personnel
- The stepping stone to future co-ordination not alone in Army and Navy but in all government departments
The disadvantages of this plan seem to the writer to include:
- Great savings (in money) cannot be shown at first.
- Great savings in personnel cannot be shown at first.
- Unwillingness to modify the existing order, as many high ranking officers would be transferred to other duty.
The General Plan
- The plan is intended to envisage a joint purchasing peace-time organization for both Army and Navy without destroying efficiency, and destined to effect great economics in:
- Mass production purchasing
- Liberation of officers for other duty by elimination of duplications
- Easier transition from peace to war
- It is predicated upon the dovetailing of similar functions in the two services and is the result of careful study along these lines. The office of the G.P.A. is modeled upon its war-time predecessor and would be under the direct supervision of the O.A.S.W., O.A.S.N., and the chief co-ordinator of the U. S. A.
- Also, it is predicated upon the absolute conviction that command functions of the using services must be left intact, i.e.:
- Appropriations
- Planning and specifications
- Inspection
- Storage and issue
The Navy Plan
The organization of Navy procurement under this proposed plan would be less of a sharp transition than that of the Army, as purchasing has been centralized in the Bureau of Supplies and Accounts. This office would, together with the procurement branches of all bureaus which now exist, be immediately merged into the corresponding branches of the G.P.A. The planning branches of these bureaus would then be moved into appropriate branches in the planning section of the chief of operations office (just as in the Army they are placed with G-3) and the finance group of the Bureau of Supplies and Accounts would automatically merge with the finance division of G.P.A. The accounting group would merge with its counterpart in the G.P.A.
The Army Plan
- The plan envisages the separation of the various component parts of the Army as follows:
- Command (or using) branches
- Procuring branch (G.P.A.)
- Transport and repair (Quartermaster Corps)
- The present Ordnance and Quartermaster Corps would be divorced from their purchasing functions—the planning done by them would be co-ordinated in G-3 while the procuring would be allotted to the G.P.A. The Engineer, Signal, C.W.S., and Medical Corps Supply services would also be merged into the G.P.A. as it would be necessary for joint Army and Navy procurement to be centralized.
- In the G.P.A. certain divisions, to handle the mass production materials more easily, have been revived from wartime W.I.B. committees. These, however, are not essential in time of peace and may be temporarily disregarded thus leaving only 12 divisions functioning by materials rather than, as at present, by services.
Organization of G.P.A.
(а) The General Purchasing Agency would be composed of:
General Purchasing Agent
Deputy General Purchasing Agent
1 Director of Priorities
2 Deputy Directors of Priorities (Army and Navy)
1 Co-ordinator of Requirements.
2 Deputy Co-ordinators of Requirements(Army and Navy)
Chiefs of Sections
Deputy Chiefs of Sections (one for Army, one for Navy)
1 Chief Paymaster
2 Deputy Chief Paymasters (Army and Navy)
1 Chief Accountant
2 Deputy Chief Accountants (Army and Navy)
(b) The G.P.A.’s own organization would include:
1 Chief Personnel Officer
2 Deputy Chief Personnel Officers (Army and Navy)
1 Chief Clerk
2 Deputy Chief Clerks (Army and Navy)
Other personnel as necessary
(c) The enormous volume of payments for the numerous items to be bought would necessitate a careful checking of the present systems in vogue in the Army and Navy. A uniform accounting system is essential.
(d) The all important item of the budget should be handled by the joint budget board.
(e) As soon as the definitive allotments have been made (as at present) and the using services have been given their shares, the chief paymaster of the G.P.A. will be given by each using service in both Army and Navy certain funds for specific purchases and projects. These allocations of funds will be dispensed from time to time to the G.P.A. from the using services, but in no case will the G.P.A. have to return any saved money. This will form a basis for a revolving fund for the G.P.A. to be used in case of overlapping or deficiencies in their procurement. These revolving funds are the best forms of Army and Navy financial media and should be encouraged wherever possible.
Joint Purchasing
(a) The present system of decentralization of purchases throughout the Army and Navy procurement areas could be left intact. An amalgamation of all the joint activities (eight at present in New York City alone) would result in great saving in personnel and funds. The G.P.A. office would assume control of these regional offices and function along new lines of demarcation.
(b) War-time procurement plans could be pushed ahead concurrently with the peace-time procurement.
Best prices on mass production orders would result from the simultaneous publishing of requests for bids throughout the United States, and the fact that most of the large concerns who would bid have plants strategically located all over the country would make the distribution of such orders comparatively simple for the Army Service Corps, located in each area headquarters. The advantage of regional contact is very great.
(c) The present arsenal, yards and docks, and other joint producing plants should remain intact as at present; G-4 controlling the Army activities and the appropriate bureaus in the Navy controlling theirs as at present. Reasons:
- The plan of procurement alone is so vast that it is unwise to superimpose another large organization at the outset.
- The experimental and design work done at arsenals and yards and docks is so directly connected with command functions that it is unwise to disturb it at present.
- The problem of storage is so debatable that this is left to the decision of those in whose hands this set-up will be delegated.
Recommendation
(a) Immediate: That the War and Navy Departments, together with the chief coordinator’s office, prepare studies as follows:
- Draft of proposed plan, setting forth clearly the limits of both the command and the procurement functions of each echelon of the joint services.
- Redistribution of areas of decentralized purchasing and the amalgamation of overlapping and competing offices.
- Unification and standardization as far as possible of purchasing specifications.
- Careful analysis of the personnel now used with a view to economy and efficiency in new joint set-up (one department for each category).
- Preparation of estimates showing what is now expended for procurement and what savings can be effected in new joint plan.
- A schematic comprehensive study of the new G.P.A. office and the (Army) Navy service corps, and orders covering same.
(b) Future: That studies be prepared with a view towards:
- Consolidating all arsenals and manufacturing plants into a separate service.
- After the G.P.A. system has been in use, a general re-writing of the orders covering it.
- A study of comprehensive country-wide scope with a view towards consolidating all U. S. government purchasing services under the chief co-ordinator.
- A yearly revision of allocations, accepted schedules of production, descriptions of manufacture, factory plans, and the data upon which any satisfactory plan of war procurement must necessarily be based.
The writer fears that if these or similar steps are not taken voluntarily by the cooperation of the Army and Navy, a plan utterly divorcing the procurement features and functions from both Army and Navy will be foisted upon them backed by the popular clamor for retrenchment and economy through congressional legislation. In the writer’s opinion this would be a major calamity for both defense services.