Bleeding TalentHow the U.S. Military

Attracts, Trains, and Mismanages Great Leaders

Tim Kane, Ph.D.The Kauffman Foundation

February 2011

Overview1. Atlantic magazine essay (January 2011)2. Why focus on the U.S. Army?

Because I think it is the most important branch, the most affected by the problem, and the most innovative.

3. Survey of 250 West Point grads4. The straw man debate5. A small vision for reform

Why The U.S. Military Is Getting Dumber P.80Provocative, but misleading title. It reminds me of the joke about military intelligence which, yes, I have heard before …

Well, authors do not write titles or blurbs. Editors do. It got attention, but set back the discussion.

Why Our Best Officers Are LeavingWhy are so many of the most talented officers now

abandoning military life for the private sector? Increasingly, the military is creating a command structure that rewards conformism and ignores merit. As a result, it’s losing its vaunted ability to cultivate entrepreneurs in uniform.

What is the Army Doing Right?

1. Recruiting superior talent (officers and enlistees)

2. Evaluations ACOM, BCOM3. Cutting-edge war-games & simulations4. Training adaptable leadership

(entrepreneurship)5. Real responsibility for young leaders6. Supporting innovation at the tactical level7. Fostering entrepreneurial sub-orgs (e.g.

Rangers)8. Many more things than I can know or list …

People are great, culture is great, structure is bad.

What is the Army Doing Wrong?

• Merit is ignored in favor of seniority, box-checking.

• Performance evaluation is politically correct, not detailed, not useful for feedback.

• Promotions are strictly gated: one narrow path.• Up or out framework discourages

entrepreneurship, talent development. No lateral entry.

• Job-matching is a disaster. Meant to be objective, instead there is a “black book” network. Inefficient and morale crushing.

But none of this should be a surprise, because the core culture of the military is Spartan, a.k.a. egalitarian. Operationalized through central planning.

Survey of 250 West Point Grads

“93 percent believed that half or more of ‘the best officers leave the military early rather than serving a full career.’ Among active- duty respondents, 82 percent believed that half or more of the best are leaving.”

Yes, al-most all of the best

leave

Yes, MOST of the best leave,

some stay

Partly, about half the best

leave

No, a FEW of the best

leave, most stay

No, the second

best leave

3%

45% 45%

7%0%

Do the best officers leave the military early rather than serving a full career? (N = 250)

Tim Kane, Survey of West Point graduates

Survey of 250 West Point Grads

“But the talent crisis persisted for a simple reason: the problem isn’t cultural. The military’s problem is a deeply anti-entrepreneurial personnel structure.”

Strongly agree

Agree Disagree Strongly disagree

18%

51%

24%

7%

Creative thinking and new ideas are(were) valued in your military units. (N = 250)

Tim Kane, Kauffman Foundation survey of West Point graduates

Survey of 250 West Point Grads

1 2 3 4 5 6 7 8 9 10

U.S. militaryPrivate sector

Tim Kane, Kauffman Foundation survey of West Point graduates

Merit Seniority

Any promotion system balances seniority against merit. If 1 is all merit and 10 is all seniority, how do you rate the U.S. military's promotion system? The private sector? (N = 250)

SSI: “Since the late 1980s … prospects for the Officer Corps’ future have been darkened by … plummeting company-grade officer retention rates.Significantly, this leakage includes a large share of high-performing officers.”

Survey of 250 West Point Grads

PercentActive Duty

Percent

Yes, strongly agree 19% 23%Yes, agree 59% 55%

No, disagree 20% 23%No, strongly disagree 2% 0%

Does the current exit rate of the military's best young officers harm national security?

[M]y main worry: How can the Army can break-up the institutional concrete, its bureaucratic rigidity in its assign-ments and promotion processes, in order to retain, challenge, and inspire its best, brightest, and most-battled tested young officers to lead the service in the future? - Robert M Gates,Secretary of Defense

Survey of 250 West Point Grads

PercentActive Duty

Percent

Yes, strongly agree 23% 20%Yes, agree 43% 48%

No, disagree 31% 30%No, strongly disagree 4% 3%

Does the current exit rate of the military's best young officers lead to a less competent General Officers Corps?

Survey of 250 West Point Grads

All Active Duty

... does a good job weeding out the weakest leaders. 26% 18%

... does a good job retaining the best leaders. 6% 5%

... does a good job matching talents with jobs. 16% 18%

... does a good job promoting the right officers to general. 28% 38%

... promotes & incentivizes entrepreneurial leaders. 5% 8%

... should be radically reformed. 55% 55%

Which of the following statements do you agree with? (check all that apply).

The current military personnel system ...

Straw Man Debate• Best and Brightest vs. Dummies• Quitters vs. Patriots• West Point Elites vs. ROTC

The retention crisis is a symptom, but it is the lesser form of talent bleeding. Internal bleeding is the real danger.

Evolution of the U.S. Military

Freedom rather than coercion. Not: slave or mercenary. Professionals should not be coerced.

Draft /Selective Service

All VolunteerForce

1940-1973 1973-now

Recruiting Coercion Markets

"In the course of [Gen. Westmoreland's] testimony, he made the statement that he did not want to command an army of mercenaries. I stopped him and said, 'General, would you rather command an army of slaves?' He drew himself up and said, 'I don't like to hear our patriotic draftees referred to as slaves.' I replied, 'I don't like to hear our patriotic volunteers referred to as mercenaries.’”

- Milton Friedman

Evolution of the U.S. Military

Freedom rather than coercion. Not: slave or mercenary. Professionals should not be coerced.

Draft /Selective Service

All VolunteerForce

All Free Force

1940-1973 1973-now

Recruiting Coercion Markets Markets

Assignments Coercion Coercion Markets

Questions about Talent1. Why is the top engineering graduate not able

to apply for an engineering position? Wrong AFSC

2. What is the difference between a 14-year and a 16-year officer?

Different Year Groups3. Why can’t commanders select their own

officers? Central Planning says “Needs of the Army”

4. Why can’t ex-officers return to the ranks? Because they lack experience!

Commanders:

Tens of thousands of job openings at various units around the military.

HRC (Personnel Command)

HRC tries to manage careers, fill jobs, forecast needs.Officers apply to locations, not jobs.

Boards meet to review and promote officers.Commanders have little say in who is assigned to them.

Each commander is responsible for hiring personnel in his unit.

All Free Force (an economist’s framework)

Trust individuals to do what is best for their own career.Use market forces to meet needs of the military, not coercion.

Boards still meet to authorize, not award promotions.Each commander has an HR officer for hiring, mentoring.

Bleeding TalentHow the U.S. Military

Attracts, Trains, and Mismanages Great Leaders

Tim Kane, Ph.D.tkane@kauffman.orgwww.growthology.org