Directors of Personnel and Administration and Logistics," it said, were "placed in the direct channel of communication" between the services, and other Army staff agencies. The two directors would direct and control the services' operations and activities, while other General Staff directorates would supervise their functions through them. The Assistant Secretary of the Army would also exercise some supervision over the services, contacting them normally through the Directors of Personnel and Administration and of Logistics.

The precise nature of the control to be exercised by the Directors of Logistics and Personnel and Administration over the still powerful technical services remained unclear. They still retained their own personnel, intelligence, and training functions and their own budgets even if under supervision by the General Staff. They still continued to command their own field installations. The question remained how a staff agency like the Directorate of Logistics, responsible for a single function, could effectively control all the activities of such multifunctional staff agencies and military commands. As General Larkin explained it to General Collins some months later: "My first act as Director of Logistics was to tell the Service Chiefs that, despite their appearing under me on the chart, I expected them to deal with any appropriate Director without coming through me." In practice the control of the Director of Logistics over the technical services was limited to those logistical matters it had formerly controlled and no more. Under Department of the Army Circular 342 there was no change in the traditional status of the technical services so far as their supervision and control were concerned.46

The Cresap, McCormick and Paget Survey

The Management Division continued to urge action on the later phases of the reorganization supposedly initiated by Department of the Army Circular 342. After additional investigation Maj. Gen. Edmond H. Leavey, the Comptroller, recommended in March 1949 the consolidation of training functions under the Army Field Forces and personnel functions under the Directorate of Personnel and Administration as

46

(C) Memo, General Larkin for General Collins, 5 Aug 49, re: Cresap, McCormick and Paget Report. CS/USA 320 D/A (27 Jul 49), RG 110, NARS.

"Phase II" of the Johnston plan. He also wanted further planning on development of a new system for "program review and analysis," the consolidation of matériel functions, and transforming the technical services into functional staff agencies.

The existing organization, he said, was unsatisfactory because it was "neither a true functional staff nor a true integrating staff," both of which Secretary Royall had approved as organizational objectives. Department of the Army Circular 342 was only a step in the right direction. Revising the National Defense Act of 1916, as amended, would be another.47

A six-month independent staff study by the management advisory firm of Cresap, McCormick and Paget, requested by Assistant Secretary Gordon Gray in October 1948, also demonstrated the need for improving further the organization of the department. Cresap, McCormick and Paget formally submitted its study to Secretary Royall on 15 April 1949. This and General Leavey's proposals for further reorganizing the Army staff provoked an angry outburst from Lt. Gen. Thomas B. Larkin, the new Director of Logistics. As Quartermaster General he had strongly opposed the Johnston plan, and his new position gave the technical services a much stronger voice on the Army staff. He complained to General Leavey that the latter's apparent objective was "a functional organization, naively assumed as a panacea for all ills real or imaginary." His own experiences overseas during the war contradicted this idea. "Concrete results [in improving the operation of the Army's logistics system] will appear soon if I am not forced to waste the time of my staff probing abstruse theories as desired by Col. Johnston." The plans of Colonel Johnston's he had seen "would make top organization still more complex. Much is beyond my comprehension." As for the Cresap, McCormick and Paget Survey, he added, "I do not see where it helps to pay outside firms large sums to tell the Army how to organize." Instead he recommended reducing the Army staff 30 percent across the board and giving "the organization a chance to work without constantly proposing changes to try out new theories.

I do not understand why the Army should persist in harassing

47 SS, General Leavey, c. 14 Mar 49, sub: Status of Organizational Planning and Proposals for Further Action. McCrimmon Round-Up file.

itself with unproved theories instead of devoting full time and attention to the job in hand." 48

The principal reason for his antagonism toward the Cresap, McCormick and Paget survey was evident. Like the Johnston plan it recommended functionalizing the Army staff. Its final report identified several familiar problem areas in the Department of the Army. The department's activities cost too much money and required too many people to perform them. Departmental personnel lacked "cost consciousness." It took too long and was too difficult to get action or decisions. There was too much duplication and red tape, inadequate co-ordination, inadequate planning, and too much centralization. The department had poor procedures for planning, programing, and controlling its operations. Its organizational structure was weak because its headquarters was divided into too many separate agencies. At the same time some important functions were not being performed at all, and responsibility in some instances was assigned to the wrong agency. Finally, organizational relations between Army headquarters and field installations were too complicated and confusing.

To economize on manpower and money, to get prompt action, to cut down red tape and eliminate confusion, to create an organization more nearly like those of the Navy and Air Force and one suitable for wartime expansion, Cresap, McCormick and Paget proposed a number of objectives. The Army should integrate responsibility for long-range, basic planning and separate it from operational planning and operations themselves which should remain integrated. The Army's budget structure should parallel its organizational responsibility. The Army staff should be functionalized by concentrating responsibility for basic functions in single agencies, reducing the number of independent and autonomous agencies, and in general grouping related activities. Finally, departmental relations with the field should follow a single staff and line command channel.

The Cresap, McCormick and Paget proposals were similar to those of General Somervell and to the Johnston plan. The organization Cresap, McCormick and Paget proposed for the

48

Copy, Memo, Larkin for Army Comptroller, 29 Apr 49, re: Reorganization of the Army. Case 1, CS/USA 320, D/A, 1-10, 1949. RG 110, NARS.

top level of the Army staff was similar to those established under Department of the Army Circular 342, with one important difference. Instead of a Deputy Chief of Staff for Plans and Combat Operations and one for Administration, it proposed a functional realignment with plans and programs, including programing and budgeting, under one deputy and operations and administration under another. The Army Comptroller would become in effect a third deputy. This threedeputy concept, as it later became known in the Army staff, essentially provided for broad, across the board planning, execution, and control or review and analysis of performance. It was the type of centralized executive control engineered earlier at DuPont and General Motors and adopted in the Marshall reorganization. Following World War II an increasing number of major industries adopted this approach, notably the Ford Motor Company."

The Cresap, McCormick and Paget study proposed that the only other Army staff agencies reporting directly to the Chief of Staff would be The Adjutant General, Judge Advocate General, the National Guard Bureau, the Executive for Reserve and ROTC Affairs, the Chief of Information, and the Inspector General.

The Army's functional staff would consist of nine directorates under the Deputy Chief of Staff for Administration: War Plans and Operations, Personnel, Security, Training, the Surgeon General, the Chief Signal Officer, the Chief of Engineers, Procurement (Ordnance), and Supply (Quartermaster). Finally the Cresap, McCormick and Paget proposals would make all Army headquarters agencies purely staff advisers to the Chief of Staff with operating responsibilities decentralized to the field. The continental armies and other regional commands would direct all field operations under the staff supervision of the Department of the Army.50

Representatives from Cresap, McCormick and Paget explained their proposals to the Army staff and the technical

"(1) Chandler, “Management Decentralization.” (2) Study Group B, OSD Project 80, The Three-Deputy Concept-Its Evolution and Disappearance. Working Paper No. 18, 27 Jun 61. Project 80 files, OCMH.

50

Cresap, McCormick and Paget, Survey of the Department of the ArmyFinal Report, 15 Apr 49, secs. II, pp. 1-19, III, pp. 37-61, IV, pp. 6-16. CS/USA Survey of the Department of the Army, 1949. RG 110, NARS.

service chiefs at two conferences in May and June 1949. The Management Division also prepared a review of the proposals. The principal objections came from General Larkin and the technical service chiefs. For the third time in less than a year they presented united opposition to any proposals for functionalizing their agencies out of existence. In yet another round robin letter, dated 19 May 1949, the chiefs complained to the Chief of Staff:

The recommendations made in the report revolve about the theory that a functional breakdown of the Army's mission is a more suitable basis for primary organization than is a product-technical division. Nowhere in the report is this statement proven, and nobody has even been able to present to us an example where such a type of organization has proven effective when applied to an operation of the magnitude, diversity, and scope of the United States Army.51

The Chief of Ordnance, General Hughes, sent a memorandum to the Comptroller, General Leavey, wondering whether $25,000 paid to some other firm instead of the $75,000 paid to Cresap "would not have elicited a more reasoned report."

The report is basically unsound in its reasoning. It follows the line that any error in a huge organization can be cured only by a reorganization. I have been in the Army since 1908 and in the Ordnance Department since 1912. During that time I have participated in n + 1 reorganizations and have observed that always afterward the ignorant, the undisciplined, the empire-builders, the lazy, and the indecisive continued to make the same mistakes they made prior to the reorganization.

Hughes denied that the "buck-passing” and “red-tape,” which Cresap, McCormick and Paget asserted, were endemic in Army administration were caused by faulty organization. The proposals to functionalize procurement and supply at the level of the Army staff were "both unwise and dangerous."

51 (1) Army: O&M: CMP-Comments and Papers, 28 Mar-1 Jul 49, pt. XIII, passim, RG 117, NARS. (2) Tab A to Tab 1, Comments submitted by Departmental Staff Agencies on Final Report of Cresap, McCormick and Paget on Survey of the Department of the Army, assembled by the Management Division, OCA, 27 Jun 49, and Tab Rd Rob, Memo for CofS, 19 May 49. Both in Tabbed Materials to Accompany a Study on Improvement of Organization and Procedures of the Department of the Armyprepared by the Management Division, Office of the Army Comptroller, 22 Jul 49. Original in RG 117, NARS. Comments by the staff agencies accompanied only the original copy of the Tabbed Materials. The rest contained only an analysis of them by the Management Division.