With retention on the decline, the military is losing its best officers. 
How can corporate America avoid making the same mistake that’s costing the military its brightest stars?

The military is known for producing great leaders.  A real trial-by-fire culture (literally), officers as young as 22 are put in charge of leading 30-50 people in trying, sometimes adverse conditions.  With an imperfect selection process for choosing these young officers, naturally some are better than others, and others are sub-par.  One would hope that the really good ones stay around to become generals or admirals, and the terrible ones are weeded out early in the game; however, in reality, it is often the middle group that stick around for long enough to promote to become admirals or generals.  The military succeeds in weeding out the terrible officer, but fortunately for corporate America, they have seemingly also managed to lose a high percentage of the top performers too.  What is the military doing wrong?  Why have retention levels dropped every year since 1983?  More importantly, where did those good officers go?  In a survey of 250 West Point graduates conducted by Tim Kane, it revealed that 82% of those surveyed believe that half or more of the best are leaving.

Junior officers (JOs) typically have between one and 15 years of commissioned service.  Almost all of today’s JO’s joined after 9/11 and entered a ‘war-time’ military, making them appear to be cut from a special sort of cloth.  They have seen their fair share of deployments, have lost friends and subordinates in battle, and have been asked to hone their leadership skills in the most difficult environments.  In the military of wars past, men like the ubiquitous John Paul Jones, who commanded his first ship at the ripe age of 28 , were hand selected by their leaders above for rapid promotion and increasing levels of responsibility.  Meritocracy was the norm, and those who were truly great were pushed, mentored, and promoted well ahead of their peer group.

If John Paul Jones, instead of being the father of the US Navy, had been a 2008 graduate of the US Naval Academy, at 28, he would be a Lieutenant (O-3), and would be assigned to a ship as a division officer (three levels below ship’s captain).  He would have gone to his first ship in 2008, been promoted the first time in 2010 (to O-2), and a second time in 2012 (to O-3).    Jones, a brilliant Naval mind and recognized leader, would have been acknowledged by his superiors as a rising star.  Those words would have appeared on multiple evaluations by now, and he likely would have been asked to do some of the tougher jobs for people of his rank, but Jones would still promote in lock-step with his Naval Academy classmates (the good and the bad), and would only be allowed to do the job of a Lieutenant.  Jones won’t be up for promotion to Lieutenant Commander until 2017, and he will not be commanding a ship until at least 2025, when he turns 39!

The military’s performance system is set up to reward tenure, not performance.  Today’s JOs are millennials, and unlike their Baby Boomer parents who were content ‘waiting their turn’, millennials are eager for more responsibility, and rank commensurate with their performance; however, military promotions are lock-step for the first four ranks (O-1 through O-4, lasting the first 11-12 years of service), and jobs are tied to rank.  A top JO cannot be rewarded with more money, more time off, a higher rank, or a more advanced job.  So how are they rewarded?  Typically their ‘reward’ is the assignment of additional work, usually the slack left by an underperforming officer of the same rank, earning the same paycheck.  It’s easy to see why the good ones get frustrated!   One such Lieutenant was quoted as saying, “My executive officer has been on leave [vacation] the past two weeks, and I’m standing in for him.  My Captain told me that I was doing the job far better than the XO, and that he wished I could be his permanent XO.  The annoying part?  I won’t be eligible to be an XO for another SEVEN YEARS!”

When these high performing officers leave the military, they come to corporate America hungry for more responsibility, and more recognition.  They crave meritocracy.  They are no different than other high performing millennials in their desire to be tangibly rewarded for their excellence.  What must businesses do to avoid the pitfall the military has fallen into?

  • Find tangible ways to say “amazing job.” If your employee is a rising star, let her know by giving her a new title with more responsibility, a small pay raise, more decision making autonomy, a few extra days’ vacation, or by assigning her a seat on a committee or board normally composed of more senior people.
  • Be flexible on the amount of tenure required. If it usually takes six years to achieve a certain position, but it’s clear your rising star is ready after only three, promote him early!  This sends a powerful signal to everyone that performance is rewarded MORE than time in the seat.  Though some people who have been performing at a mediocre level for five years might be upset, a worker who has only been there two years now knows that if she works hard and does well, she can move up.
  • Don’t be afraid to cut the dead weight. Under performers are a waste of money, resources, and time, but often employers are terrified to get rid of them.  Building hiring contracts to allow for early job termination for underperforming makes it clear where the bar is.  When your top performers see their under-performing peers let go, they will likely feel a tangible sense of reward for their hard work.  This may be scary at first, but after some time, you will find that you attract and retain better talent.
  • Tailor career paths to strengths, not a predetermined route. Forcing someone to promote to a job they do not want, or preventing them from transferring laterally in the organization to a functional area that is more in line with their skills and interests will likely result in your rising star leaving and seeking employment elsewhere.  Have the courage to realize that the predetermined path is not always the best one for either the organization or the individual.

The military may not be ready to implement broad reforms to their promotion, job assignment, and compensation structure.  The loss of their top officers is corporate America’s gain.  The businesses that realize that millennials play by a different playbook, one that allows people to rise to CEO of startups shortly after college, and adjusts their system of incentives and rewards accordingly will find themselves retaining and attracting the top talent.  Those that stick to the rigid, tenure-based, wait-your-turn culture see their best talent as they walk out the door in favor of an organization who will reward them for their greatness.

The military’s performance system is set up to reward tenure, not performance.  Today’s JOs are millennials, and unlike their Baby Boomer parents who were content ‘waiting their turn,’ millennials are eager for more responsibility

– Jennifer L. Tietz, T'15