US-SOVIET EXCHANGES EXERT STRONG INFLUENCE ON THE SOVIET CONSTRUCTION INDUSTRY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T01003A002300170001-7
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 8
• Document Creation Date: December 12, 2016
• Document Release Date: January 31, 2002
• Sequence Number: 1
• Publication Date: August 1, 1965
• Content Type: BRIEF

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US,SOVIE:T EXCHANGES EXERT. STRONG INFi,;UENGE
ON THE SOVIET CONSTRUCTION TNDUSTRX
DIRECTCIRATE OF INTELLIGENCE
Office of Research and Reports
Excluded from automatic
dawngrading- and
A roved'-For Release 2002/ON~A+~~T9Ye~IH03A0023001.7000 - declaf,.ifiCa,ian
pp
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This materiai contains intormatlon aSeeting
the National Defense of the United States
within the meaning of the espionage laws,
ZYtle 18, USC, Secs. 793 and 794, the trans-
mission or revelation of which in any manner
to an unauthorized person is prohibited by law.
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US-SOVIET EXCHANGES EXERT STRONG INFLUENCE
ON THE SOVIET CONSTRUCTION INDUSTRY
Recent US-Soviet exchanges in the construction and construction
materials industries have led the foremost Soviet construction journal. to
the unprecedented conclusion that US practices -- financial, organza-
tiona]., and operational as well as technological -- should be held u.p to
Soviet builders as models for possible adoption in the Soviet construction
industry. Whereas Soviet builders on earlier exchange delegation: have
stated privately that the US construction system is much more flexible
and efficient than their own, they have stopped short of going on record
to that effect. Their published praise has been limited to staternexits on
the massive use of machinery and equipment and on the quality of the end
products in the United States.
Recent reports, however, emphasize the economic (financial ~~.nd
organizational) as well as the technical lessons to be learned from the
United States. These reports praise US organization and techniquf~ --
particularly in the planning and designing of projects and the application
of the Critical Path Method -- and contain no overtones of propaganda or
disparagement.. The money and effort spent by the American Government
and many private companies on exchanges have resulted in the US image
now being shown to leaders, planners, and workers in an importar.~t
segment of the Soviet economy in a very favorable light. Moreover,
Soviet officials and delegates have repeatedly expressed their dee~~
appreciation both for the constructive comments offered by their U'S
hosts and for on-site suggestions and criticisms offered by US delegates.
Regardless of the current political climate, economic needs appear
to dictate that the USSR adopt many US construction practices to help
stimulate economic activity. The recent search for solutions to intract-
able economic problems -- suggestions typified by the Liberman pro-
posal and other ideas in which profit plays a dominant role -- probably
laid the foundation for serious consideration of Western financial xrrac-
tices in the construction industry.
1. Soviet. Reactions to the US Construction Industry
It is evident that contacts with US construction personnel and visits
to US construction sites have directly influenced Soviet thinking on con-
struction problems. Officials of the American Embassy in MoscovT
recently learned of a 1/2-hour documentary film on US construction which
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is being shown to construction engineers in various cities in the USSR,
The film reportedly was made by members of a Soviet construction dele-
gation that came to the United States in 1964. A Soviet engineer who saw
the film said that it was very impressive. He indicated that it was being
shown as a training film on "proper construction methods. "
Observations of V. M. Abramov published in the May 1965 issue of
the foremost Soviet construction journal, Promyshlennoye stroitel'stvo,
present the "positive aspects of the organization of construction in the
USA" and indirectly express dissatisfaction with Soviet methods.
Abramov, an engineer, was a member of the Soviet Construction and
Thermal Power Delegation, which visited various construction sites in
the US during 1-Z2 June 1964. He is assessed by US contacts as observant
and openminded. His article presents a number of features of US con-
struction in a laudatory manner and with considerable insight. Although
not saying so, the author seems to have selected items in which the Soviet
construction industry is weak..
The topics discussed include the planning and designing of projects,
the contractor's role in construction, the training and payment of workers,
efficiency in the use of equipment and tools, and the availability, packaging,
and supply of building materials. Abramov went into considerable detail
in discussing US planning and designing of a project, indicating what infor-
mation the client furnishes, the responsibilities of the design organization
and the data furnished by rt, and the suggestions received from the gen-
eral contractors. In discussing the general contractor, Abramov indi-
cated procedure for the selection and use of subcontractors, the method
of payment, adherence to the contract, and the contractor's responsibility
for planning and maintaining construction phasing. The use of the Critical
Path Method of planning and directing construction projects was noted with
approval. (The Critical Path Method is a method of planning, scheduling,
and managing canstruction projects developed by the Remington Rand
Corporation for E. I. du Pont rle ATemours Company in early 1957. It is
similar to Program Evaluation and Review Techniques -- popularly known
as PERT -- which was first used in developing the Polaris missile and is
now widely used by US Government agencies. }
The manner in which the tasks or responsibilities discussed. by
Abramov are handled in the Scwiet construction industry is frequently
criticized by responsible Soviet leaders. One of the most recent ex-
amples of this is an article that appeared i month later in the June 1965
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issue of the Soviet economic journal Planovoye khozyaystvo written by
I. T. Novikov, Chairman of the State Committee for Construction Affairs of the
USSR. He was the leader of the exchange delegation of which Abramov
was a member. Novikov's criticisms of Soviet construction mana?;ement
practices also reflect the influence of contacts with US construction per-
s onnel.
In this article, Novikov says that there are serious deficiencies in
design work in the USSR, including prolonged periods of design, e~ccessive
amounts of documentation, and the stipulation of the use of equipment and
materials that have not been perfected. These deficiencies lead toy major
alterations before planned capacity can be achieved. In planning a:nd
organizing construction, he urges use of the Critical Path Method, which
he defines as a new, progressive, and scientific method that has been
proved in practice. To improve management further and accelerate the
placing of capacity into operation, Novikov advocates a new method of
payment of contractors. He calls for payment in two stages: (a) after the
foundation work is completed and (b) after the aboveground work is com-
pleted. He also says that it is necessary to broaden the rights and. in-
crease the responsibilities of contract organizations and their leaders,
to penalize contractors for not fulfilling contracts on time, and to give
premiums for fulfilling contracts.
Analyst:
Coord:
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.MEMORANDUM FORe Chief, Dissemination Control Branch, DD~CR
. Chief, Publications Staff, ORR
I't is requested that the attached copies of CIA~RR ~ ~i~,-~~~ iT~3~ Suet
Exchi~,n es exert Strom 3:n.fluenee oxx the $t~~r3.et Can,s~ruetioz~ I~~du~~tr?,~~
Ait,.s~,anfdenli~.~., be ~orwar a as f'o3lows:
State, INR Communications Center,
Room h527, State Dept. Bldg.
Suggested distribution for
Embassies in ~er1::Ln' Bueharests
Buest, i-~acow, Prtzej ~o~`la,.
~'erse~~r~ Boar~~. and Lraador,
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