By 1957 Nikita Khrushchev was in a relatively secure position as first secretary of the Communist Party. Several years earlier he had outmaneuvered Georgii Malenkov for party leadership by stressing the need to continue developing heavy industry and increasing military expenditures, policies that appealed to core constituencies of the party. He also built via the power of appointment an extensive network of loyal clients in the central apparatus and regional party organizations. He had weathered the storms of the previous year in eastern Europe occasioned by destalinization, and could point to the success of his Virgin Lands scheme (link) that had brought millions of new acres under cultivation.
Now determined to confront the top-heavy bureaucracy that he blamed for inefficiencies in economic planning and shortages of consumer goods and housing, Khrushchev embarked on a radical restructuring of economic administration. In February he announced the abolition of most central industrial ministries and the creation of 107 regional economic councils (sovnarkhozy) corresponding to the territorial divisions of oblasts and autonomous republics. Intended to bolster regional party leaders' participation in and supervision over economic decision-making, the "Law on Further Improving the Organization of Management of Industry and Construction" was passed by the Presidium of the Supreme Soviet on May 10, 1957.
Stung by the implications of this decentralization program, Viacheslav Molotov, Lazar Kaganovich and several other Stalinist stalwarts confronted Khrushchev at a meeting of the party's Presidium in late June. They accused him of sowing disunity in the party, promoting his "cult of personality," and otherwise acting irresponsibly. However, Khrushchev parried this attempt to oust him as first secretary in favor of Nikolai Bulganin by calling an extraordinary session of the Central Committee. Thanks to Georgii Zhukov, the Minister of Defense who arranged military transport to bring Khrushchev's supporters to the capital, the majority in the Central Committee turned the tables on Khrushchev's critics by denouncing them as an "anti-Party group" and confirming him in office. The conspirators were forced to resign from the Presidium and assume minor posts in the state bureaucracy. Zhukov was rewarded for his support by being upgraded from a candidate to full member of the Presidium, but in October 1957 he was removed from office and sent into retirement, undoubtedly because he had come to represent a threat to party oversight of the military.