Why the U.S. Must Reform the Military Personnel System

By Eoyang, Mieke; Freeman, Ben | National Defense, May 2015 | Go to article overview

Why the U.S. Must Reform the Military Personnel System


Eoyang, Mieke, Freeman, Ben, National Defense


* The military personnel management system is a Cold War relic populated by a 21st century workforce. Left unchecked, this growing disconnect between employment opportunities in the armed services and the private sector will hinder the military's ability to recruit the best the nation has to offer, and that undermines national security.

While the recommendations of the Military Compensation and Retirement Modernization Commission's (MCRMC) final report, released in late January, are laudable, the commission's mandate was not broad enough to fully address this fundamental challenge of a military personnel system that increasingly doesn't match the expectations of today's workforce.

The fact is that 83 percent of military personnel will never see a dime of retirement pay because they leave the military before serving the requisite 20 years, while their peers in the private sector rack up hundreds-of-thousands of dollars in 401 (k) retirement plans that move with them when they change jobs. Those same peers have choices about their careers and are able to stay in one location or move based on the best job options available to the family while military personnel are typically forced to move their entire family every three years, regardless of their spouse's career prospects, children's education or housing situations.

We've identified three policy options that put us on the path to a more modern military. These are not small changes. But if our military hopes to continue employing the best and brightest, it needs to consider fundamentally changing the military personnel system, not merely tinker with pay and benefits.

As the MCRMC's interim report noted, the services recruit and retain personnel through a "closed" system, "in which service members are generally promoted from a pool of more junior members already in that system." A closed system ensures greater uniformity of culture, which improves efficiency for management, but also has significant drawbacks in managing for talent.

This system makes it impossible to capture talent that may have begun on a different career path, and difficult to recapture personnel who left the military to acquire valuable talents elsewhere. For example, if you're a mid-career wizard of Silicon Valley and want to do your part to fill the growing need for cyber professionals in the U.S. military, your only option is to effectively restart your career as an entry-level officer. Needless to say, this isn't very enticing for a highly educated professional who's likely earning a six-figure salary.

More importantly, it denies the military all the skills mid-career professionals like this could bring to bear. Any large organization--and with more than 2.2 million service members the military certainly qualifies as large--that exclusively recruits leaders internally is foregoing all the benefits that could be provided by the incredibly dynamic civilian workforce.

While they might lack experience at military academies or commanding troops on the battlefield, they might have unrivaled experience elsewhere--like managing logistics for UPS, working in the trauma unit of a hospital emergency room or running a large supply chain for a multinational company--that could be incredibly valuable to the military.

Also problematic: The current system encourages military members with skills that are highly sought after in the private sector to leave for good. As the MCRMC notes, since the start of the all-volunteer force there has been "a sustained increase in the overall education of service members, creating a far more professional and technologically fluent force." These trends make service-members more desirable in the private sector and the military currently has few on-ramps back into active-duty service once service members leave. And, the options currently available--like the Air Force's Career Intermission Pilot Program that offers airmen up to a three-year sabbatical--are extremely underutilized. …

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