After making the decision to mass produce a submachine gun, the Soviet Union adopted the Degtyarev PPD-38 and PPD-40, but this design was too expensive for the huge scale of production that the USSR intended. A new design was needed, and was put into development almost as soon as the PPD was entering production.
Shpagin won the design competition with the PPSh-41, a weapon which required virtually no lathe work at all. It was assembled from a combination of heavy-gauge stampings and simple milled parts, and it fit the Soviet requirements quite well. Shpagin retained the high rate of fire and large drum magazines from the PPD, and even had a semiauto selector switch in his submachine gun, a bit unusual in a weapon intended for minimum expense.
The drum magazines proved to be the weak point of the design, being only somewhat interchangeable between weapons and being rather complex to manufacture as well as bulky to carry and fairly easy to damage. A 35-round box magazine was introduced later on which ameliorated some of these issues, although not all of them. The PPSh-41 would go on to be deemed itself too complex, and supplemented by the PPS-43 submachine gun, although it was never fully replaced during World War Two. In addition to Soviet service, it would be copied and manufactured by several other nations.
Thanks to Marstar for letting me examine and shoot their PPSh-41!