In the process of troubleshooting why my newly acquired M38a1 wouldn't start I noticed the ground strap from the alternator was connected to nothing. I consulted TM 9-804A (1/4 ton 4x4 m38a1) and on page 124 it shows that the strap should connect to the rear bolt of the front engine support.
The ground strap that you are showing goes from the battery to frame or body. The one you are looking for has no clamp on it. It has an eye on each end, meaning just a bolt or stud hole on either side.
Clean it up you might be suprised. It is suppose to mount on the back side of the motor support and route to the back motor mount hole. Yours looks to be on the wrong side of the motor support. large star lock washers are what clamps it down. The star cuts the paint to give good ground. On the motor support side there are two star washers on both sides of the strap while on the motor mount side a flat washer on the motor mount, strap then star washer. Reference Page 134 Maintenence manual right side connections and engine clutch manual page 140 i paragraph. That's the way I interpreted it.
Item c on figure 12 in the Engine clutch manual is the strap 7371311. The parts manual (radio suppression section 0615 part 7371311) says it is 71/2" for early models and 12 3/4" for later models. I used an 8" and it is tight.
The strap is used to ground the engine to the frame bypassing the rubber motor mount. Just remember ,when a poor ground is obtained electricity trys to find it's own ground path where ever it can and heat is built up through poor connections.