CHART 9. ASF INDEX OF CONTRACT PRICE CHANGES

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CHART 9. CHART 9. ASF INDEX OF CONTRACT PRICE CHANGES

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sions in price or contract rights might be granted. Further standanii- zation was accomplished by issuing a comprehensive Procurement Regulation applicable to all phases of contracting and purchasing. In this way the many divergent rules and regulations of the different Technical Services were standardized in the interest of greater efficiency.

The need to participate in the war effort felt by small manufac- turers was of increasing concern in 1942. The Army Service Forces and the War Production Board were interested in utilizing all pro- ductive facilities that could contribute to the output of war materiel.

In the period prior to Pearl Harbor, War Department contracting operations had favored the larger manufacturing establishments, be- cause their production costs were ordinarily lower than those of sma,ller plants. Moreover, large enterprises had the financial re- sources and the managerial capacity required for new production programs. Before the passage of the Smaller War Plants Act in 1942, the Army Service Forces had launched a program designed to broaden participation in war production. During the last year of the war, 60 percent of all contracts were awarded to plants employing under 500 wage earners. In terms of total dollar value, tills was 25 percent of all contract commitments of the Army Service Forces. For civilian-type items, smaller war plants were able to handle even more than 50 percent of the dollar value. In the production of such items as heavy artillery, tanks, and ammunition, the larger plants played the more important role. AU prime contractors, however, were eu- cout·aged to subcontract as widely as possible, and in this way many more small plants were brought into war production.

The procurement organization of each Technical Service was differ- ent from the others. For procurement planning purposes, in the 1920's and 1930's, each Service had established procurement planning offices scattered throughout the United States. The Ordnance De- partment used its 13 procurement district offices for a large proportion of its purchasing during the war. On the other hand, the Quarter- master Corps bought, not through his procurement planning district, but through depots specializing in tile type of goods procured. The Boston Depot, for example, purchased shoes; the Philadelphia Depot, woolens and clothing; the Chicago Depot, foodstuffs; the Jeffersonville Depot, all cotton duck and general supplies. The Signal Corps, at the beginning of lhe war, had several field offices for procuring snp- plies, but subsequently concentrated purchasing, by commodity, in the three offices located at Fort Monmouth, Philadelphia, and Wright Field. The Medical Department originally had four offices, but at lhe end of the war had a single procurement office in N ew York City.

As the war progressed, the Ordnance Department's geographic organ- ization for procurement was modified by the establishment of com- modity offices, such as the Tank-Automotive Center in Detroit_ Some Services, such as the Signal Corps and the Quartermaster Corps, estab- lished separate geographic organizations for contract inspection and production expediting. The general trend, however, was toward pur- chasing on a commodity basis.

Neither the geographic nor the commodity bases for procurement was exclusively sntisfactory during the ^Wal', There were many com- mon problems in purchasing which had to be solved on a geographic basis, such as tile supply of labor, local community problems, the spreading of contracts among different producers, the avoidance of duplication in plant and product inspection, and the handling of ac- counts, financial services, and transportation. The boundaries of the procurement districts of the Technical Services, no two of which were the same, complicated the coordination of these procurement activi- t ies among the Services. On the other hand, there were decided ad- vantages in commodity specialization, which enabled the procuring Service to deal with an entire industry, wherever located. Moreover, commodity purchasing facilitated the maintenance of records of ex- ist.ing ana potential suppjies available for military needs, the COll-

trol of procurement in the light of stocks and estimated demand, and the prompt changing of procurement programs.

510rage

The storage mission of the Army Service Forces was to assure that adequate quantities of all types of supplies and equipment were read- ily available when needed at key points in the supply pipeline. In the performance of this mission, it was equally important that stocks be maintained at the lowest practicable levels in order to reduce the total volume in the pipeline, and that t.here be a constant forward {low of supplies and equipment from the manufacturer to the user.

In marked contrast to the leisurely handling of storage matters in peacetime, it was bustling big business during the wal". Two million people were engaged in handling more than four million tons of sup- plies a month at 125 large installations in the Zone of tile Interior.

The three principal aspects of stornge were space, mechanical equipment, anel manpower. As in other fields, requirements had to be established, steps taken to fulfill them, and controls instituted to as- sure proper utilization.

By the end of 1 D42 an estimate had been made of antici pated maxi- mum requiremellts for covered stomge space. Substantially all needs could be supplied by usillg existing facilities and those under ^COl1-

struction. Plans for additional major construction were cancelled.

As a result of this early and comprehensive analysis of the maximum supply load, many millions of dollars and great amounts of man- power and materials were saved. The extensive use of open storage space also contributed to the reduction in over-all constl'uction re- quirements. Centralized control of space was essential in order to avoid excesses in some instal1ations while shortages existed elsewhere.

In accomplishing this, all spRce was placed in a common pool for allo- cation and reallocation to the Technical Services. This step alone made it possible to save over 32 million dollars in the cost of new con- struction in the last fiscal year of the war. Whe.n the war ended, stor- age facilities were occupied to within 15 percent of their maximum efficient utilization. Centralized control also made possible the intro- duction of standardized improvements in storage procedures. Stand- ardization of aisle width and other model'll warehousing practices resulted in further rednction in space requirements.

In the field of materials handling equipment, the fork-lift truck and the palletized load, used together, provided prompt and efficient han- dling of stores. The use of these devices permitted the stacking of as many as 100 packages of the same commodity on a 4-foot square pallet, and the fork-lift truck displaced gangs of six to eight men using manual methods. The extensive use of materials handling equipment placed a strain upon the available supply. In the Fiscal Year ending 30 June 19-14, over 45 percent of all available equipment was sent overseas, and in the next year 57 percent was also assigned to Theaters. Because of the limited supply, constant care was exercised in order to assure that equipment was placed only where it would be most fully utilized.

Many other modern practices also contributed to storage efllciency and the better use of manpower. Among them was the stock locator system, which permitted storage by lot size rather than by the waste-

ful numerical sequence method; and a daily car situation report, that made careful planning of loading operations possible. In spite of all efforts to achieve greater efficiency in operations and bet.ter utiliza- tion of personnel, the manpm,er problem was critical throughout the period of hostilities. Continuous efforts were made in order further to reduce the number of personnel required; among the most sig- nificant was the Work Simplification Program applied to materials handling. Under this program methods of doing specific operations were charted, and improved by the use of techniques familial' to industry but not heretofore used in the Army.

The propel' geographic distribution of storage facilities in the Zone of the Interior had been given inadequate attention in the period prior to Pearl Harbor, when the majority of the storage depots were located and placed IInder construction. Each Technical Service had de-

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veloped its own distribution system and storage plan independently.

There was no integrated storage plan for the Army as a whole. .As the war progressed, it became evident that the entire distribution sys- tem depended for its efficiency upon the location of depots. It also became apparent that the existing depot system did not meet all needs.

Unfortunately, it was then too late to make the large scale changes that were desirable, an~ it was also impractical to redistribute the large stocks that had been developed. The difficulty consisted of reconciling such inconsistent needs as proximity to manufacturers, proximity to large military posts in the United States, and proximity to Ports of Embarkation. The solution required careful planning and such adjust- ments between facilities as were practicable. For example, toward the end of the war, the number of depots in the western part of the United States became inadequate for supporting the shipment of supplies through west coast ports. Depots were cleared of surplus and slow- moving stocks in order to provide space for more active commodities.

After VE-day many supplies destined for the Pacific were shipped from the east coast and ports on the Gulf of Mexico.

In addition to performing its own storage function, the Army Serv- ice Forces worked with other agencies of the Government to provide storage for industrial property that became surplus when war con- tracts were curtailed. As part of this work, it made considerable space available to the Reconstruction Finance Corporation and other disposal agencies for the storage of surplus commodities nntil they could be sold.

Packaging and Packing

The packaging and packing of supplies for oversea shipment were closely related to the storage function. "Packaging" contained the product itself, and was usually performed at the production point;

"packing" prepared items for transport, and was usually done at depots, or in the field in the case of organizational equipment. Pack- aging invo1ved the cleaning of an item, the application of corrosion preventatives, wrapping, the use of cushioning materials, and unit containers; packing involved the shipping container, inc1uding cush- ioning, bloc;':ing, bracing, weatherproofing and strapping. The two operations were closely interrelated. Thus the packaging of C and K rations in individual waterproof containers made the packing less difficult. On the other hand, the packing of unpackaged ammunition was a continuing concern, whether it was done in individual or bu1k lofs.

Careful attention was given to packaging and packing from the be- ginning of the war, in order to prevent loss through breakage or

deterioration. Amphibious operations in both Europe and the Paci·

fic, rudimentary oversea dock and storage facilities, and the great humidity in the Pacific all produced an urgent need for extraordinary moistureproofing and packaging. The Army Service Forces tested many dilf'erent water-proof harriers in order to find the one best adapted to the packaging of particular items. One laboratory tested approximately 1,300 different types of greaseproofing. On occasion, difficulties were encountered in persuading an industry to adopt the desired packaging and packing specifications. This was true of the anti friction bearing industry which did not desire to change thc cleaning, preserving, and pacl.-ing methods employed during ~he pre- vious 20 years. The procurement of packaging and packing ma- terials also became quite troublesome. Within the War Department, the Quartermaster Corps took over the direct purchasing of water- proof, greaseproof, and moisture- vapor-proof materials for the Army Air Forces and the Army Service Forces at a time when the supply of those materials was most critical. It was later found that the dupli- cation of orders between and the separate stockpiling by the several Technical Services and the Air Forces had actually caused the shortage.

The moistureproofing and iungnspl'oofing of communications equip- ment were among the noteworthy achievements of the war. Great strides were made in improving packing and crating methods in order to make better use of limited shipping space. The shipment of gen- era 1 pUl'pose vehicles knocked-down, or in twin 01' single unit packs, was particularly useful in saving shipping space. In spite of the progress made by the end of the war, much remained to be done in im- proving packaging and packing practices.

Distribution

The initial equipping of units and individuals ancl the replenish- ment of supplies and equipment were the two principal phases of sup- ply distribution in the Zone of the Interior. Supplies and equipment for newly. activated units were issued on the basis of tables of equip- ment and allowances j replenishments wel'e provided on the basis of requisitions. Thus, initial equipment was automatically shipped to units from central control points, whereas replenishment items were drawn by the users as needed.

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anuary 1942 the G-4 Division of the War Department General Staff had inaugurated a direct system of supply. Previously, Corps Area Commanders had received all requisitions from troops within their areas, and reviewed and forwarded them to depots. Unclerthe Ilew system, post supply officers received requisitions from troops, and either filled them from station stocks or forwarded them directly to

the depots designated to supply the particul",r post. This had re- duced the length of time required to filJ requisitions.

The Technical Services prepared requisitions for newly activated units, and shipped initial equipment directly from depots or manu- facturers to post supply oflicers. They had '" better knowledge of allowan('cs than the newly appointed troop commanders, who were thus relieved of the burden of preparing voluminous initial requisi- tions. The Technical Services also maintained records of selected critic",1 items and the status of unit equipment, and could therefore closely control the issue of such items in accordance with established priorities.

In the early days of the war, the Army did not have enough guns, ammunition, and certain other items of a strictly military nature to fill all requirements simultaneously. This condition persisted for a few items to a lesser degree throughout the war. As new models came off the production lines, they were sent to Theaters first, and supplied for training purposes as they became morc abundant. Transfers of equipment between units were frequent in order to insure that units going overseas carried their complete allowances and necessary re- placements. In addition, weapons were sometimes withdrawn from units in the Zone of the Interior in order to replace shipments lost at sea 01' expended in battIe.

The Technical Services, at the specific direction of Headquarters, ASF, maintained rigid distribution control over important and criti- cal supply items, including tanks, heavy artillery, mortars, flame throwers, til'CS and tubes, recoilless rifles, various calibers of ammuni- lion, dry batteries, X-ray film, field wi re, various radio and radar sets, and hea vy tentage. Priorities were establ ishec1 by Headquarters, ASF, in accordance with which newly activated units received only certain percentages of their equipment during training. Nondivisional units, for initia.I training purposes, received 20 percent of their allowance;

divisional units received 50 percent. When a unit prepared for over- sea movement, every effort was made to supply it with 100 percent of its allowances and, when this could not be done from depot stocks or from pl'oduction, equipment was transferred from other units. Pri- ority at aU times was given to oversea shipments. Priorities between the several Theaters were established on the basis of strategic plans.

Thus, the European and Mediterranean Theaters enjoyed first priority on most items; the Pacific Theaters were given second priority; Lend Lease needs and supply to China, India, and Burma \\'ere lo\\'er on the priority list.

The development and adoption of the Stock Control System was the most important single wartime improvement in distribution opera- tions within the Zone of the Interior. Before 194~ each Technical

Service oflicer at a post followed a different supply and requisitioning procedure. Va.riations between posts were also numerous. No one knew how much stock of thousands of items was on hand. Some posts might have a six-month supply of a single item and others have none.

The Army Service Forces recognized these deficiencies and in 1942 began studies which restllted in the establishment of a stock control system at posts in May 1943. Each post thereafter had an established supply level, which constituted the normal inventory of that post.

Stocks above this level were excess and were returned to depots. Post supply ofliccrs were required to make periodic physic,tJ inventories of supplies and to adjust their stock records accordingly. They also re- viewed the stock level from time to time 011 the basis of issue experience and anticipated needs. The usi.ng units stationed at a post and draw- ing their supplies from its warehouses were provided with a single form for requisitioning any type of supply. In turn, each post used standard forllls in requisitioning replenishments from depots. Depots established schedules so that requisitions came from posts at definite intervals, thus avoiding peak and slack loads in depot operations. A great deal of training and readjustment was required. Technical Service depots, Service Command Headquarters, and post supply offi- cers all cooperated in fixing stock levels for hundreds of thousands of items, and in reviewing them as troop population increased or de- creased. Before the end of the war the system was operating success- fully throughout the Zone of the Interior.

One of the first adjustments made for meeting the gargantuan task of supporting our oversea forces was the decentralization of the over- sea supply machinery. In February 1942 the oversea supply plan and the standing operating procedure known as POM (Preparation for Oversea Movement) for equipping and moving troops overseas were prepared. In March 1942 the Army Service Forces designated a single Port of Embarkation as the main source of supply for each oversea command. Such ports served both as a springboard from which the initial operations in establishing a Theater were launched, and as the collecting and loading point for subsequent supply. An Oversea Supply Division was organized in each Port of Embarkation, which served as the control point for information and records showing the supply status of each Theater. These were supervised by the Office of the Director of Plans and Operation, Headquarters, ASF, in order that controlled items and depot operations could be properly checked.

Methods of correlating supply with demand in supporting oversea operations shifted between the alternatives of automatic supply and supply by requisition. The supply plan put into effect early in the war placed considerable emphasis on automatic supply. For estab- lished oversea bases, this method was employed for supplies such as