The Value of Vets

Years into proving they’re good hires, veterans now struggle to find a good fit inside many companies.

They will match in crisp uniforms, leaving parade crowds in awe, and politicians all over will honor the brave.  But on the eve of Veterans Day, the evidence shows that the private sector still has work to do to capitalize on a typically talented work group. 

Studies have shown there's growing recognition that military veterans can make excellent additions to an organization, but that getting vets in the right career path continues to be an issue.

Nearly 40 percent of professionals say their organizations are placing a greater emphasis on hiring veterans than they did five years ago, according to an October 2017 Korn Ferry survey. The 1,000 professionals surveyed appreciated the leadership, team mentality and goal focus of vets.  But almost 70 percent said that there was no training to hiring managers on veteran-specific hiring practices, and more than 60 percent said there was no onboarding or transition support for veteran hires.

In this recent Briefings article, we profiled several vet executives who had landed work, but said that the right job can remain more elusive.

Perhaps one of the most significant moments of Mark Lipscomb’s life fell on a foggy autumn morning in 1997. From the bridge of the USS Chosin, also known as the War Dragon, the then-26-year-old naval officer was in charge of setting the course for the first American naval ship to enter the Port of Hong Kong since the territory returned to Chinese rule. Not only was Lipscomb responsible for the safety of 400 sailors, his coordinates could very well end up setting the diplomatic course for two of the world’s superpowers, which had just begun to mend a relationship strained by ideological differences, security threats and competing global aspirations.

Before Lipscomb had time to consider any of that, though, the captain was shouting commands, and what appeared to be a patrol boat waving a Chinese flag was racing in their direction. With shallow water that would surely ground his multimillion-dollar ship lapping on one side, and his aggressors—possibly pirates, possibly part of the Republic—closing in on the other, Lipscomb was forced to make a decision.

It’s intuitive that military veterans would also turn out to be strong leaders on the corporate battlefield. Lipscomb, who comes from a long line of submariners, is now vice president of human resources at Netflix, after previously holding the same job at Tesla. But at the streaming provider’s swanky Los Gatos campus, where visitors are greeted with towering cases of gold-plated Emmy Awards, that isn’t why Lipscomb, with a slight frame and easy charisma, says he hires veterans. He points to more nuanced traits, like the cultural sensitivity to traverse workplace diversity. Lipscomb’s inclinations echo a growing body of research that defies common assumptions, highlighting a variety of areas in which retired service members are more competent than their civilian colleagues.

Despite those skill sets, veterans returning from Iraq and Afghanistan are facing bleaker job prospects than their comrades of past wars. Generally, veterans have had higher employment rates than civilians, but since 9/11 that hasn’t held true. Experts and service members alike say that it isn’t necessarily because they can’t find a job—they can’t find the job. Indeed, according to a Syracuse University study, 65 percent of veterans, regardless of rank, leave their first civilian job within two years. Nearly half leave within a year. While society may honor service, it also stigmatizes those who serve, blocking veterans from advancement or roles without a direct connection to their technical training.

That means companies may be missing out on an increasingly rare opportunity, with overall veteran numbers shrinking. Many companies have veteran-hiring programs out of a “civic duty,” but “it’s not just a nice thing to do,” says Nick Armstrong, senior research and evaluation director at Institute for Veterans and Military Families at Syracuse. “It’s good for the bottom line.” So some are now using the emerging research to create corporate programs tailored to maximizing veterans’ unique agilities, and with measurable success.

Back in the South China Sea, with his captain—above him not only in rank but also in decades lived—screaming for him to go one direction, Lipscomb, who was ultimately in charge of steering the course, decided otherwise. By mere moments, the War Dragon avoided a confrontation that could have reverberated through the world. And Lipscomb went on to trade his service dress blues for a pair of navy street sneakers, his barracks for plush red velvet chairs, and his 9-millimeter for a human resources manual.

There was a time when nearly everyone had a friend or family member who worked for the military; during World War II, more than 12 percent of the US population served in the armed forces. Today that number has dropped to less than 1 percent. With a much smaller slice of society enlisting, and conscription having ended more than four decades ago, the all-volunteer brigade has become somewhat mythic. “People don’t understand the military or how it operates,” says Patrick Mullane, a retired Air Force captain and executive director of Harvard Business School’s online learning platform, HBX. This widening fissure between Americans and those tasked with protecting them has created numerous societal and cultural riffs, but it’s also affected how the business sector employs—or doesn’t employ—this segment of the workforce. “You get asked by an interviewer to talk about a time you were challenged, and it’s hard not to laugh,” says Lipscomb. “How about launching tomahawk missiles? We have to figure out how to translate our experiences in a way people can relate to.”

On average, close to 200,000 service members exit the military each year, and thanks to a series of White House and private company initiatives, the unemployment rate for Gulf War II–era veterans, which hit double digits during the recession, is now about the same as the general population’s. Still, many veterans seem to slip away during that initial transition to the first job. Twice as many, for example, work in the public rather than private sector. And hiring managers, being more comfortable with what they know, are shown to harbor implicit biases. A survey by the George Bush Institute, a non-partisan policy center, found respondents believe far more post-9/11 veterans suffer from mental health issues than actually do. Meanwhile, employers are less likely to hire someone with an invisible disability rather than physical one.

The past decade has produced a body of research that shows veterans are in fact highly adaptive, do best when handed a problem and told simply to figure it out, and are not far behind Tony Robbins when it comes to tapping into people’s inner motivations. “Some of the strongest competencies military veterans bring are in the people area,” says Randy Manner, a former senior client partner for Korn Ferry and retired Army major general. Manner recently analyzed data that found veterans score higher than executives with upward of 30 years’ experience when it comes to mental and people agility as well as driving results.

After almost three decades in the Army, Ross Brown shifted into an executive post in 2015 at J.P. Morgan, which has launched a veteran-hiring program. Since then, he’s been trying to figure out what it takes to cultivate the vast potential veteran hires bring—because many don’t stick around long enough to build personnel connections. “For veterans to self-actualize, they need to feel like they’re a part of something bigger than themselves,” Brown says.

Recruitment isn’t nearly as tricky as retention.

At least part of the US military strategy in Afghanistan has been to secure strategic terrorist footholds, which span from the snow-tipped mountains of the Paktika province in the eastern part of the country to the arid desert valley that cradles the Helmand River in the south. That’s a lot of ground to cover. Too much, thinks Chris Penwarden, who went to West Point and then spent almost 15 years traversing the Middle East as an operations officer and then company commander. Too much too fast, anyways.

From his Atlanta office, Penwarden continues his study of warfare, comparing military and business tactics. After completing an executive leadership program at Harvard and medically retiring from the Army in 2015, Penwarden moved into an executive position at a cell tower development firm. But he didn’t last. The 37-year-old felt restless; he wasn’t using his leadership or technical skills and, most of all, he lacked motivation. “You’ll never have a higher purpose than you did in the military,” Penwarden says. “After you leave, you’re always trying to find that.”

Through a veteran-placement agency, Penwarden ultimately was brought on as CEO of US Military Maintenance, which helps veterans franchise janitorial businesses that contract with federal and corporate customers. Taking what he learned from war, Penwarden’s approach is to move sequentially, securing one market before moving on to the next and staying in close enough proximity that business owners can provide cover for one another without also being in harm’s way if the local economy should come under attack. His strategy is working: 30 branches, some with up to 25 veteran employees, are teaching clients what “military clean” looks like.

Veterans are almost twice as likely than non-veterans to pursue business ownership, and their five-year success rate is higher than the national average, according to the US Small Business Administration. Indeed, many qualities that are characteristic of entrepreneurs hold true for ex-military—including resiliency, of course. Nothing nurtures stamina like carrying a 100-pound backpack through triple-digit temperatures, as Penwarden will tell you.

Uncle Sam likes to tell soldiers they can do anything they set out to do. And that makes sense since there’s no room for second-guessing mid-mission. What it means, though, is many soldiers march out of the military believing they can do anything—and that employees will follow commands without asking questions. Many vets can make quick decisions, but struggle to put them into context. “I was used to looking at everything in terms of life or death,” J.P. Morgan’s Brown says. “There was always a sense of urgency and gravity; I had to learn to dial it back.”

Still, most veterans in executive ranks argue their colleagues are at their best when motivating and interacting with a team of disparate members—navigating diversity that goes beyond skin color and gender to include educational background, socioeconomic status and experience on the front lines. At Netflix, Lipscomb laughs about being a 40-plus white guy working on diversity, but the military is perhaps the only place where people are forced to collaborate across both cultural identities and geographic borders, in the most intimate and stressful situations.

Diversity is exactly what Caroline MacDonald found when she moved into the hospitality industry after serving in the Air Force in the ’80s. Since she couldn’t find a job using her service skills, she worked her way up from an hourly sales associate to being the VP of sales and marketing for Rosewood Hotels & Resorts in the Americas and Europe. MacDonald, who joined the military at age 19 so she could travel and get an education, says people are always surprised when she tells them she’s ex-military. That’s likely because she’s petite and feminine, and the stigmas attached to veterans go beyond PTSD. “Employers don’t think of the military as a good source of candidates, but they’re missing out,” MacDonald says.

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