This educational effort has since then been presented in Albuquerque, Atlanta, Charleston, Charlotte, Columbia, Indianapolis, Kansas City, Knoxville, Miami, Mobile, Omaha, Phoenix, St. Paul, St. Petersburg, and Savannah which cover a wide geographical area as is evidenced in the attached chart.

In every case the undertaking was shared with the SBA regional offices, appropriate Members of Congress, DOD, NASA activities in the area, and local government officials. Cooperative advanced publicity insured excellent small business turnout for the sessions and resulted in qualifying many firms for a higher degree of technical effort than they had heretofore contemplated.

A key part of this program is a series of small business education forums which we sponsored in these various cities I have mentioned. The first forum was held in St. Petersburg, Fla. Since then 18 of these meetings have been held and we have some more scheduled in the months to come. The forums are designated, are designed rather, to acquaint small businessmen with opportunities available to them in defense and space subcontract work and to provide them with technical information and guidance on how to qualify as a supplier to Martin and other prime contractors.

To date, businessmen representing approximately 1,600 small firms have participated in these forums.

As a direct result of this participation many of the firms have qualified for Martin bidder's lists and are doing business with the company at the present time.

Because virtually the same military procurement requirements and conditions apply throughout the aerospace industry, the forums have also helped small business firms to become suppliers to other prime contracts to other industries and to the Government directly.

One small businessman reported that he had landed an important order from another prime contractor as a direct result of knowledge gained through a Martin-sponsored forum.

We have had some comments from government officials relative to these small business forums. The Administrator of the Small Business Administration sent us a comment to this effect:

An example of the constructive attitude taken by some of the larger contractors is to be found in the small business subcontracting forums being conducted by the Martin Co. in cooperation with the Small Business Administration. In these courses small businessmen are given the basic knowledge essential to successful contracting under Martin or any other defense contractor. It is our hope that other large contractors will promote similar subcontracting seminars within the intent of the cooperative program and for just plain good business reasons. Senator Anderson, of New Mexico, after our forum out there, wrote us a letter to the effect:

That information passed on during the forum will apply not only to business relations with Martin but also with Government prime contractors and with space and other military agencies as well.

I might add we have a multitude of correspondence relative to these forums and the general consensus across the board is they have been very effective and much appreciated.

These small business forums have been conducted by all three of our major buying divisions. I have attached hereto a pamphlet

entitled "Small Business and Labor Surplus Area Program" which was issued in May of 1964 by the Denver division. While the facts presented therein are confined to the Denver division efforts, they are typical of work done by the Orlando and Baltimore divisions in other areas of the country. You will find that the pamphlet describes the close working relationships between Martin and Government Small Business administrators in the interests of furthering the small business program in the area.

You will also find that an "Award of Merit" program has been established to stimulate buyer interest in placing contracts with small businesses. The certificates are presented to those who have demonstrated a positive effort beyond the scope of their normal duties in furtherance of the small business program.

The regional director of the Small Business Administration joins the Denver director of materiel in presenting the award. The pamphlet also illustrates the depth of subject matter covered in the small business support forums by showing a typical agenda.

These forums generally ran 2 days, the first day consisting of a number of lectures and presentations on the part of personnel from various Martin divisions from either director or manager level, and on the second day consisted of counseling sessions between individuals of the Martin Co. and those small businessmen who had a definite interest in getting into the program.

In order to gain the price advantages inherent in wider competition, Martin has established a technical procurement function within each of its divisions. The purpose is to provide better interface action between procurement and engineering. By increasing the engineering technical capability of procurement personnel, Martin is now in a position to exert more pressure on design engineering to broaden specifications within reliability and cost requirements. This affords increased competition and makes more items available for small business bidding.

This organization, with assistance from manufacturing, quality control, and reliability, conducts surveys of new suppliers in order to qualify them for critical item production. Recommendations made pursuant to surveys have often enabled small business contractors to improve their operations from both a management and technical aspect. This dissemination of technical and management know-how has been one of the principal corollary benefits of the program.

Recognizing that defense business has leveled off and is perhaps more likely to ease downward, Martin and other large aerospace producers are finding that there will be a steadily decreasing subcontract workload.

Consequently, we have decided to change the pattern of our small business assist program. The emphasis has shifted away from seeking new sources and now is concentrated on solidifying and technically upgrading those who are already qualified.

With the trend in defense prime contracts rapidly moving from cost to incentive and fixed-price types, we find the Government, of necessity, disengaging from detailed contract management. In so doing, however, they impose increasing requirements for demonstration of the primes' ability to manage his subcontractor. Accordingly,

we must have a formalized and operating system which has thorough knowledge of a subcontractor's current degree of effectiveness in such areas as production, quality, reliability, procurement methods, resources, and so forth.

Our aim, then, is to improve the capability of those subcontractorspredominantly small business-who are presently on our source lists rather than to aggressively seek additional sources. We, of course, are still interested in qualifying good new sources, but the emphasis has shifted. In the course of these forums we will try to keep small business contractors informed as to such things as

(a) DOD policy and procedural changes.

(b) New programs.

(e) Estimates of future hardware requirements.

(d) Latest in production techniques, and so forth.

Martin also renders assistance to small business through this medium on a personal counseling basis relative in such matters as(a) Testing procedures.

(b) Reliability management.

(c) Configuration control procedures, and so forth.

Finally, I have a suggestion to offer. The success we have so far attained in our latest approach to assisting small business leads us to believe that it might well be applied more widely. Through Government encouragement and sponsorship, the large commercial product manufacturers could be induced to undertake a similar type of small business assistance program to improve the technology, production, and management capability of their small business suppliers. Their increased efficiency should, in turn, produce cost reductions while furnishing a better product to the customer.

We wish to assure you that the Martin Co. will continue to have a dynamic small business support program not only to fulfill legal requirements, but because we feel it is good business and in the overall national interest.

That concludes the statement, sir; thank you.

(The attachments referred to appear in the appendix.)

Mr. MULTER. You have made an excellent statement, and I am sure the committee would be very happy to note the fine work your company is doing in this field.

We will review the attachments that are submitted with your statement and then print those in full that should be printed and either excerpt or file the others as may be appropriate in each instance.

Your attachments numbered 2, 3, 4, and 5, do they represent updating of the various items or

Mr. ODELL. No, sir; those attachments represent implementation of the company policy down to a detail level by the buying divisions to insure that it is carried out by the individual buyers, and so forth. It gets down to pretty small detail but it is part of our overall policy and criteria guide to promote the small business program.

Mr. MULTER. And they are of general application throughout the company's various divisions?

Mr. ÖDELL. No; they have application only to the division which issues them. You will find there is one from Orlando, one from Denver, one from Canaveral and one from Baltimore. They do vary because of

the fact they are in different locations and they have different product lines. So that there is some variance locally in the implementation of the overall company policy.

Mr. MULTER. Would you care to make any comment on the testimony that was presented this morning by the Strategic Industries As

sociation?

Mr. ODELL. Only this, sir, that I thought it was excellent, and that I basically agreed with everything that I heard.

Mr. MULTER. Are there any questions?

Thank you very much, you have given us a very fine presentation. Mr. ODELL. Thank you, sir.

Mr. MULTER. I want to repeat again to all of the witnesses who came in here today, we are indebted to all of you. I know that your testimony will be very helpful to the subcommittee in formulating its recommendations to the full committee which will then be presented to the Congress.

Is there any other comment that anybody on behalf of the Strategic Industries Association would like to make at this time? Any further comment by any of the witnesses we have heard?

If not, we will recess the committee at this time subject to the call of the Chair.

(Whereupon, at 3 p.m., the subcommittee recessed, subject to call of the Chair.)

SCIENTIFIC APPARATUS MAKERS ASSOCIATION

Mr. HENRY A. ROBINSON,

SCIENTIFIC APPARATUS MAKERS ASSOCIATION,
Washington, D.C., August 4, 1964.

Select Committee on Small Business,

House Office Building, Washington, D.C.

DEAR MR. ROBINSON: Pursuant to our telephone conversations I am forwarding the attached 15 copies of the statement of the Scientific Apparatus Makers Association pertinent to the current hearings on Government procurement before Congressman Multer's subcommittee.

I trust that you will make copies of this statement available to Mr. Multer and the other members of the subcommittee, and arrange to have it incorporated in any official report of these hearings. Copies are also being forwarded to the pertinent procurement policy officials at the Department of Defense, Small Business Administration, NASA, General Services Administration, and Atomic Energy Commission.

Should there be a need for additional information or clarification of any portion of the statement, we shall be glad to submit further details and supporting data.

Sincerely yours,

GEORGE LAWRENCE.

AUGUST 12, 1964.

Mr. GEORGE LAWRENCE,

Scientific Apparatus Makers Association,
Washington, D.C.

DEAR MR. LAWRENCE: This will acknowledge and respond to your August 4 letter with its referral to the statement of Bruno O. Weinschel, submitted on behalf of Scientific Apparatus Makers Association for the record of this subcommittee's current hearings on Government small business procurement programs.

Mr. Weinschel's statement will be included in the record. We are asking the Department of Defense to comment regarding Mr. Weinschel's complaints and views for the committee's evaluation.

Your interest in the subcommittee's hearings is appreciated.

Sincerely yours,

ABRAHAM J. MULTER,

Chairman, Subcommittee No. 2 on Small Business and Government Procurement.

STATEMENT OF SCIENTIFIC APPARATUS MAKERS ASSOCIATION PROCUREMENT ADVISORY SUBCOMMITTEE

I am Bruno O. Weinschel, president of the Weinschel Engineering Co., located in Gaithersburg, Md. My company is a small business firm manufacturing precision microwave equipment and related instruments. I am appearing before the subcommittee today representing the procurement advisory subcommittee of the Scientific Apparatus Makers Association, of which I am a member.

The Scientific Apparatus Makers Association is a national trade association, founded in 1918, and consisting of approximately 220 member companies representing the majority of leading U.S. manufacturers and distributors of scientific instruments, laboratory apparatus and equipment. The association membership embraces manufacturing plants in 28 States, with branches and offices in virtually every State. While member companies represent a total employment in excess of 132,000 workers, a recent survey indicates that this is essentially a "small business" industry with 67 percent of member firms qualifying under the definitions of the Small Business Act.