Office of Economic & Manpower Analysis 1 Department of Social Sciences, United States Military Academy Senior Conference 2014 Talent Management Fostering Institutional Agility (845) 938-7057 DSN 688-7057
Senior Leaders Call for Institutional Agility How can the Army break-up the institutional concrete, its bureaucratic rigidity in its assignments and promotion processes? It must re-think the way it deals with the outstanding leaders in its ranks. DoD functions have evolved over time to be resistant to change, relying heavily upon approved processes. The rapid timelines for leadership change have resulted in a culture that can wait out strategic initiatives. 65% of active duty General Officers rated personnel management as one of the worst performing functions in the Army. As one General noted, human capital is the most important yet the least agile system. As an Army of people, the thing we do worst is managing those people. 2
SHOCK: Spanish-American War (1898) Adaptation: Root Reforms General Staff System Professional Military Education (PME) System Army National Guard (Dick Act) SHOCK: World War I (1914) Adaptation: Preparedness Movement Officer Training Schools (OTS) Officer Rating Scales Officer Reserve Corps (1920) SHOCK: World War II (1939) Adaptation: Marshall Reforms Officer Candidate School ROTC and West Point Expansion Army Vitalization Act (Plucking Boards) SHOCK: Cold War (1945) Adaptation: 1947 National Security Act Officer Personnel Act (1947) All Volunteer Force (1974) DOPMA (1980) SHOCK: Homeland Attacks, Terrorism, Information Age, Cyber Space, Robotics, Globalization, Social Media, Emerging markets, Climate Change... Adaptation:????? 1. History of Military Labor Force Adaptations A time traveling officer from the 1950s would be very familiar with today s Officer Personnel Management Nations rise and fall based on their ability to adapt to changing times, efficiently manage scarce resources, and innovate. 3
2. Standardized Career Path Limits Diversity and Creates a Mismatch Between Talent Inventory and Requirements PL CO S3 XO BN BDE DIV Army Leadership Colonels Non-Ops Experts Lieutenant Colonels and Majors Senior Captains Junior Captains Lieutenants Operators: MTOE Billets Non-Ops: TDA Billets Sometimes, the top officers receive the wrong development AND Sometimes, the wrong officers receive the top jobs Office of Economic & Manpower Analysis - FOUO 4
3. Evaluation Reports that Amount to Little More than an Abstract for a 300 page book. 75 words 75 words 68 words The new OER allows for 1,456 characters (242 words) that matter mostly for promotion. 5
4. Limited Information on its Talent Inventory - Even Less Information on Talent Requirements - The Army has Limited Visibility on the Cultural Fluency Within its Officer Ranks Current Army Data: 28% of Countries Green Pages Data: 72% of Countries 11% of the 700 Engineer Officers in the Green Pages Pilot have Hidden Engineer Credentials Valued at over $16 Million Certification American Welding Society (AWS) Automotive Service Excellence Certified Facility Manager Certified Professional Engineer Certified Project Manager Engineer In Training PE Civil PE Environmental Professional Geologist 6
5. Senior Officer Graduate Education is Becoming Less Diverse Share of BG Cohort by Type of Graduate Education 75% 70% 65% 60% 55% 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% Civilian Academic Institution 1995 2000 2005 2010 Distance Learning Degree Military Education System Only Type of Graduate Degree Office of Economic & Manpower Analysis - FOUO 7
6. Practices Replacement Instead of Succession Planning Jan 2011: USACE CG Jan 2011: DCS-G1 Jan 2011: FORSCOM DCG LTG Van Antwerp LTG Bostick LTG Bromberg USACE CG (June 2007 June 2011) DCS-G1 (March 2010 May 2012) Nominated for USACE: April 2011 FORSCOM DCG (Jan 2011 July 2012) DCS-G1: July 2012 - July 2014 USACE CG: May 2012 Previous Assignments CG, Fort Bliss CG, 32d AAMDC HRC (EPMD 2004) 8
7. Woefully Insufficient Senior Officer Tenure Years 7 6 5 4 3 Corporate Versus Army Tenure The commercial world often enjoys longevity in leadership that DoD does not.case studies agree that five to seven years are needed to achieve cultural change. - Defense Science Board, 2011 Corporate Army* 100% Army Staff Officer Churn 90% 80% 70% 60% 50% 40% 1 Year 2 1 30% 20% 10% 2 Years 0 CEO CSA VCSA DAS CHRO G1 COO** G3/5/7 CIO G6 CFO G8 0% Army Staff Office of Economic & Manpower Analysis - FOUO 9
Framework for an Officer Corps Strategy Access - Develop - Retain - Employ 'Talent' Objective Limited Lateral Entry Professional commanders, executives, and advisors Access Develop Retain Employ Develop Retain Employ Develop Retain Employ Limited Lateral Entry Junior Grade Learn the Profession Mid-Career Practice the Profession Senior Leaders Lead the Profession Office of Economic & Manpower Analysis - FOUO 0 ADSO 10 20 30 Years 10
www.talent.army.mil 11
Defining the Dimensions of Individual Talent for the Army TALENT SKILLS KNOWLEDGE BEHAVIORS Are shaped by: Is shaped by: Are shaped by: Native Ability Intelligences Preferences Background Education Training Experience Tenure Character Ethics / Values Goals / Beliefs Teamwork HUMAN CAPITAL THEORY 12
Concept of Army Talent Management Bob s Talent Distribution Talent Requirements Job A JOB A Organizational Team TALENT MARKET S JOB A JOB C D JOB B JOB D JOB B Cheryl s Talent Distribution Talent Requirements Job B 13
Fostering Institutional Agility to Manage Officer Talent LT CPT MAJ LTC SENIOR LEADERS From apprentice to practitioner Developed to create senior officer talent pools Professional Commanders, Executives, and Advisors Learn the Profession Practice the Profession Lead the Profession 0 2 4 6 8 11 18 20 Office of Economic & Manpower Analysis - FOUO PME 1 Command & General Staff College ILE Years of Commissioned Service Objectives 1. Differentiate people 2. Have as many career paths as unique people 3. Invest In Continuing Specialized Education 4. Improve succession planning 5. Provide sufficient assignment tenure PME 2 War College (SSC) Adaptation 1. Emplace information markets 2. Remove Yeargroups/Promotions 3. Make education the focal point 4. Constantly manage talent pools 5. Select for work not the job 30+ 14
Status Quo is No Longer an Option LABOR ECONOMIC THREAT SHOCK: Homeland Attacks, Terrorism, Information Age, Cyber Space, Robotics, Globalization, Social Media, Emerging Markets, Climate Change. Adaptation: Institutional Agility Reforms Instituted a Talent Management HR Paradigm Increased Talent Diversity to Mitigate Increasing Future Uncertainty Reduced Officer Churn and Increased Tenure for Strategic Leaders 15
Office of Economic & Manpower Analysis - FOUO Back Up Slides
Change Increasing Land Power Production by Fostering Institutional Adaptability Change Maximum Land Power Potential Land Power Production Possibility Frontier Capital (K) Greater Land Power Production U.S. U.S. China China Russia Iraq Iraq Labor (L) Land Power Production = T (K α L β ) Minimal Land Power Potential Increase Amount [ K and/or L ] ($$$$$$) - or - Improve Efficiency [ Technology (T) ] ($$$) 17
4. Industrial-Age Interchangeable Labor by Branch and Rank Company Grade Field Grade Senior Leader Infantry Military Police Logistics 18
Succession Planning Imperatives INDIVIDUAL TALENTS: What s Needed to Perform Optimally? Replacement Planning: Choose for the Position. Succession Planning: Select for the Work. WORK REQUIREMENTS: What s the Work? How Long to Do It? Who s on the Team? Talent Supply Considerations GO Vacancy Talent Demand Considerations INDIVIDUAL TALENT GAPS: What Development Can the Work Provide? Moves the discussion from Who Do We Have? to Who Do We Need? CURRENT & FUTURE SITUATION: Who s Right Today? Tomorrow? 19
The Current Evaluation System Less than 1% of officers receive a No Less than 1% of officers receive a No in any block Office of Economic & Manpower Analysis - FOUO 20
The Current Evaluation System 99% of officers are outstanding performers, must promote 66% of officers are best suited for command? 99% of officers are best qualified Rarely Used Less than 15% of OERs contain useful information on unique skills Only Field Grade Officers are Ranked Office of Economic & Manpower Analysis - FOUO 48% of officers rated Above Center Mass (ACOM) 50% of officer rated Center of Mass (COM) 2% of officers rated Below Center Mass 73% of officers are best suited for command? 21
Senior Leaders Call for Change: an Adaptable Organization A survey we conducted found that 65% of active duty General Officers rated personnel management as one of the worst performing functions in the Army. As one General noted, human capital is the most important yet the least agile system. As an Army of people, the thing we do worst is managing those people. My passion for transforming the Generating Force [Institutional Army] centered on how we manage our people will shape my tenure as Secretary. Meeting these challenges requires truly transforming how we manage our people. achieving institutional adaptability through a system that rapidly responds to organizational requirements for talent. - SECARMY McHugh, April, June 2011 Army leaders [must] exhibit critical thinking, comfort with ambiguity and decentralization, a willingness to accept prudent risk, and an ability to make rapid adjustments The Army must also expand efforts to develop leaders who have expertise in relevant disciplines through broadening experiences and high quality graduate education - The Army Capstone Concept Unfortunately, DoD functions have evolved over time to be resistant to change and rely heavily upon approved processes. The rapid timelines for leadership change in the DoD have resulted in a culture that can wait out [strategic] initiatives. DoD incentives are largely compliance-driven rather than results-focused, which leads the Department too often to optimize around process rather than delivering capability - Defense Science Board How can the Army break-up the institutional concrete, its bureaucratic rigidity in its assignments and promotion processes?... It must re-think the way it deals with the outstanding leaders in its ranks. in theater, junior leaders are given extraordinary opportunities to be innovative. The opposite is too often true in the stateside bureaucracies in which so many of our mid-level officers are warehoused. - SECDEF Robert Gates, 2011 22
Tectonic Shifts I. Economic competition, relative decline in investment, & outsized debt foster substantial uncertainty Globalization increases competition; competitive advantage shifts to nations with the lowest production costs. The growth rate of output in the U.S. has averaged only 1.6 percent over the past decade, compared to growth rates of greater than 10 percent for emerging economies such as Brazil, India and China. China s economy will grow from 1/3rd the size of the U.S. in 2010 to roughly 2 times the size of the U.S. economy in 2050. The Great Recession caused a sharp drop in federal tax collections and much higher government outlays. As a result, the U.S. deficit-to-gdp ratio is nearly 8 percent and the ratio of public debt to GDP (68 percent) is the highest since 1950. The persistent and growing national debt will require cuts to government spending: Defense will compete for scarce budgetary resources with growing outlays on entitlement programs (Social Security and Medicare). II. Labor Force changing nature of work stimulates significant demand for high-skilled labor The U.S. economy is now a post-industrial, knowledge-based economy: manufacturing s share of employment is currently 1/3rd its 1970 level; knowledge-intensive services as a share of employment has doubled over this same time. Skill-biased technological change has significantly increased the demand for college-educated workers (75% faster than the increase in the supply of such workers; the proportion of college degree workers has grown from 14% to 30% since 1970). Increased demand for high-skilled workers has doubled relative wage premiums for college graduates during the past 40 years. III. Threat expanding the focus from kinetic to economic and asymmetric Military Force is important for sustaining national security; world powers rise & fall based on the strength of their economies. With the pace of change & globalization, the state of the US military is increasingly linked to the state of the US economy. The U.S. economy and military are increasingly more vulnerable to asymmetric hostile attacks: cyber threats, utility grids, industrial and manufacturing backbone, banking systems, intellectual property theft, military technology, viral internet videos, etc. Economic growth requires investments in physical & human capital: More than half of China s GDP is devoted to investment, compared to roughly one-sixth of U.S. GDP; the share of U.S. workers with college degrees has stagnated in the past decade. The rise of emerging economies may threaten the status of the U.S. dollar as the global reserve currency, leading to a decrease in the demand for dollars and dollar denominated assets. Decreased demand for dollars will weaken the dollar s value, and could spur higher inflation and higher interest rates; both place uncertain stress on the military s ability to provide national security. 23
Senior Officer Talent Management Model Certifications, Succession Planning, Tenure, and Multiple Career Paths Professional Commanders, Executives, and Advisors Shaping Operational Billets Non-Operational Billets Shaping GO COL LTC LTC MAJ Must Control Flow 7e 7f 7f 7 7 7i 7h 8g 7g 6 6d 6e 6f 6f 6 6 6j 6i 6h 6g 6g 6 6 5 5d 5e 5f 5f 5f 5m 5k 5j 5i 5h 5g 5g 5g 5 5 5 5 5 5 5f 5f 5 5 5 5 5 5 5g 5g 5g 5 4 4 4 4 4 4 4f 4f 4 4 4 4 4 4g 4g 4 CPT 3 3 3 3 3 3 3f 3f 3 3 3 3 3 3g 3g 3 CPT 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 LT Vertical 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 Office of Economic & Manpower Analysis - FOUO 10 10 9f 9 9 8e 8f 8 8 9h 9g 20 YOS Command Horizontal Senior Leader Screen Vetting Culling Cut Pt 2 Mid Career Screen Vetting Culling Cut Pt 1 Junior Officer Screen Vetting Culling 24