In 1980, 59 percent of the CEOS of the country’s publicly held corporations had a military background. As of 2009, the percentage of CEOs who had military experience had fallen to just eight percent. Even with that drop, former military officers are still over-represented at the CEO level considering how little of the population ever gets to the rank of officer in U.S. military.
In addition to holding a disproportionate number of CEO positions, CEOs with a military background have historically outperformed the S&P 500 index over one, three, five and ten-year horizons. They have also held their corporate titles for longer periods of time on average than their non-military counterparts have.
As of the end of September, 2005, companies led by former military personnel had outperformed the S&P 500 index by 3-20 percent annually over one, three, five, and ten-year time periods. Chief executive officers who’ve served in the military have a median tenure of five years as CEO and they hold their positions for an average of 7.2 years. Chief executive officers who lack a military background have a median tenure of four years and an average tenure of 4.5 years in their positions.
One of the biggest reasons why former military personnel excel in leadership roles is that the military provides them with opportunities to gain hands-on leadership experience much earlier than the corporate world typically allows someone to take on leadership responsibilities, even if the person has an MBA. According to Michael Jordan, who served in the navy and acted as the chairman of the board and chief executive officer for Electronic Data Systems,
“The MBA gives you tools and familiarity, but it doesn’t put you in a real-world situation…[a junior military officer (JMO) can enter a company and run a department] the way an MBA has no clue how to do.”
Being in practical hands-on leadership positions so early gives members of the military the chance to develop vital skills that can help them succeed in the corporate world. For its joint report, “Military Experience & CEOs: Is There a Link,” Korn/Ferry International and the Economist Intelligence Unit interviewed four ex-military CEOs and two Korn/Ferry International executives with military backgrounds.
As a result, the report identified the following six characteristics derived from the former servicemen’s experience that have helped these interviewees perform extraordinarily well as business leaders:
- Knowing how to operate as part of a team
- Exceptional organizational skills, including planning and using resources effectively
- Ability to define a goal and motivate other people to achieve it
- Strong sense of ethics
- Ability to stay calm despite challenging circumstances and mounting pressure
As the number of young managers lacking military experience increases, companies such as Wal-Mart and General Electric have developed programs to recruit junior military officers who served their country in Iraq and Afghanistan, believing they have the leadership skills and dedication that many non-military managers lack. This is a smart recruitment strategy as it’s nearly three times more likely that a former military officer will be appointed to the position of CEO compared to non-military civilians.
CEOs with a Military Background
The list of jobs for ex-military members continues to grow thanks in part to initiatives like the Veterans’ Employment and Training Service, or VETS, and the fact that 80 percent of the jobs in the private sector have some parallel in the military. According to Linda Solis, former U.S. Secretary of Labor,
“Veterans are peak performers. In today’s economy, employers know they have to get their hiring decisions right. Veterans are a proven source of talent. They can provide an immediate bottom-line benefit because they are already credentialed, and their skills have been shaped and tested under the most challenging circumstances.”
Here is a list of ten current and former CEOs who have proven that having a military background can help veterans succeed in the business world:
1) Michael Jordan: Michael Jordan was born in Kansas City, Missouri on June 13, 1936. After growing up in a lower- middle-class neighborhood, Jordan received a scholarship to Yale University where he majored in chemical engineering. He went on to earn a master’s degree in the same field while studying at Princeton University. Jordan credited his studies with giving him the ability to “attack problems logically” and enjoyed the problem-solving side of his scientific coursework.
Jordan was a member of the Reserve Officers Training Corps during his years in college and he joined the navy as a lieutenant in 1960. After joining the navy, Jordan served four years on Admiral Hyman G. Rickover’s staff, which had been tasked with developing a nuclear-powered submarine force on behalf of the United States.
Jordan began his post-military career by joining the management consulting firm, McKinsey & Company. After ten years with that firm, Jordan became a senior corporate planner for PepsiCo. Jordan climbed the corporate ladder quickly by introducing innovations such as equipping delivery drivers with hand-held barcode scanners and computers to track their sales results. As the head of PepsiCo’s international unit, Jordan led the food and beverage giant’s expansion overseas, successfully growing the business from $300 million in 1986 to $1.8 billion in 1991.
In 1993, Jordan was recruited to become the CEO of the struggling Westinghouse Electric Company. The next year, Jordan decided to rebrand Westinghouse by buying equally troubled CBS and assuming the CBS name. The newly renamed company got out of the industrial sector and focused exclusively on the media industry after it adopted the CBS moniker.
Ten years later, Jordan was once again recruited to spearhead a turnaround. This time, he took over the helm at Electronic Data Systems, also known as EDS. As part of the turnaround, Jordan streamlined the company’s U.S. and European operations and expanded the technology consulting side of its business. Hewlett-Packard bought a thriving EDS for nearly $14 billion in 2008.
At the time of his death in 2010, Jordan was survived by his wife, two biological children, two stepchildren, and six grandchildren.
2) Steven R. Loranger: Steven Loranger served in the navy as a lieutenant and pilot from 1975 through 1981. He earned a Bachelor’s and a Masters degree in science from the University of Colorado. After his military career, Loranger spent 21 years with Honeywell and AlliedSignal, Honeywell’s predecessor. After his tenure at Honeywell, Loranger assumed the roles of vice president and chief operating officer at Textron, Inc. While at Textron, Loranger oversaw a portfolio of the company’s manufacturing divisions that was valued at $10 billion.
Prior to becoming the interim CEO and president of Xylem, Inc. in September, 2013, Loranger was the chairman, president, and CEO of ITT Corporation, a Fortune 300 multi-industry company and Xylem’s former parent company. During his seven years with ITT Corporation, Loranger is credited with splitting ITT Corporation into three separate publicly traded companies, which include Xylem and ITT Exelis, a leader in the global aerospace and defense industries.
Loranger sits on the board of directors for several prestigious organizations, including the National Air and Space Museum, the Congressional Medal of Honor Foundation, and the Wings Club. Most recently, Edwards Lifesciences Corporation announced that Loranger had been appointed to its board of directions in March, 2016.
3) Clayton M. Jones: After being raised in Nashville, Tennessee, Clayton Jones went on to earn a Bachelor’s degree in political science from the University of Tennessee in 1971 and an MBA from George Washington University in 1986. Between earning his degrees, Jones served in the U.S. Air Force as a fighter pilot for eight years beginning in 1971.
After his military career, Jones was hired by Rockwell International in 1979. He was awarded an employer-sponsored fellowship to participate in the White House Executive Exchange program in 1982. Six years later, Jones earned the title of vice president of Aerospace Government Affairs and Marketing at Rockwell Government Operations in Washington, DC.
In 1995, Jones became the corporate senior vice president at the same location before being appointed the vice president and general manager for Collins Air Transport Division in Cedar Rapids, Iowa later in the same year. Three years later, Jones became the president of Rockwell Collins as well as the corporate officer and senior vice president of Rockwell International. Jones acted as the chairman of Rockwell Collins’ board from 2002 until July, 2014, and as the company’s chief executive officer from 2001 until he retired in 2013.
Currently, Jones is a director of Deere & Company and Cardinal Health, Inc. He is also an honorary fellow of the American Institute of Aeronautics and Astronautics and a member of The Business Council and the President’s National Security Telecommunications Advisory Committee.
4) Robert S. Morrison: Now in his mid-70s, Robert Morrison served in the Marine Corps during the Vietnam War, reaching the rank of captain. During his tenure in the Marine Corps, Morrison was awarded the Silver Star as well as the Purple Heart. After leaving the military, Morrison earned an MBA from the Wharton School of the University of Pennsylvania in 1969 and started his career in the private sector with Proctor & Gamble.
Morrison had already assumed critical positions in Phillip Morris by 1991. He acted as president of General Foods USA from that year until 1994 and served as the president of Kraft Foods from 1994 through 1997. After his time with Kraft, Morrison became the chairman, CEO, and president of The Quaker Oats Company. At the time, The Quaker Oats Company was heavily burdened by the more than $1 billion of debt it accumulated after it bought Snapple. After Morrison successfully turned the company around, PepsiCo purchased The Quaker Oats Company for $13.4 billion in 2000.
After acting as PepsiCo’s vice chairman for several years, Morrison served as 3M’s interim CEO in 2005. He currently serves on numerous corporate boards, including the boards of Illinois Tool Works, Aon, 3M, and Z Capital Partners.
5) Richard D. Kinder: The father of one child, Richard Kinder was born in Cape Girardeau, Missouri on October 19, 1944. Kinder earned a BA degree in 1966 and a JD degree two years later form the University of Missouri. Before he became a leader in the energy industry, Kinder was a captain in the U.S Army in Vietnam.
After having to file for bankruptcy, Kinder was hired by Enron and rose through the ranks to become the energy giant’s president in 1986, a position he held for 10 years. When he wasn’t given the positon of CEO in 1996, Kinder left Enron and purchased Enron Liquids Pipeline with his business partner, William Morgan, in 1997. The duo renamed their new company, “Kinder Morgan Energy Partners.” As Kinder Morgan’s chairman and CEO, Kinder has grown his enterprise into a company that employs 11,000 people, oversees 75,000 miles of pipeline, and runs 180 terminals. Kinder Morgan owns more natural gas pipelines than any other company.
6) George Schaefer: George Schaefer graduated from the United States Military Academy at West Point in 1967 and subsequently graduated from the army’s Ranger School in Benning, Georgia. After graduating, Schaefer was deployed to Germany for two years to work as part of a nuclear demolition munitions unit. Schaefer finished his military career in 1971 after serving two years in Vietnam. During his time in Vietnam, Schaefer and the 280-man crew he led built a vital highway. Schaefer received a Bronze Star for his service in Vietnam.
When he returned to civilian life and failed to find work as an engineer, Schaefer became a management trainee at Fifth Third Bank in 1971. Schaefer attended business school as he started his banking career and earned an MBA from Xavier University in 1974.
Schaefer climbed the corporate ladder during his tenure with Fifth Third Bank and acted as the bank’s CEO from 1991 through 2007. Under his reign, the bank’s assets grew from $7 billion to $89 billion and the bank became one of the country’s largest bank-holding companies.
7) John A. Luke, Jr.: John Luke, Jr. served in the United States Air Force during the Vietnam War. Luke received a Bachelor of Arts degree from Lawrence University before he earned his MBA from the Wharton School of the University of Pennsylvania.
In 1992, Luke was appointed CEO of Meadwestvaco, making him the fifth-generation head of the family company. When he took the position, the company was under heavy public scrutiny for being an environmental polluter. Luke oversaw a successful sustainability turnaround which involved initiatives such as procuring materials from renewable resources, including the company’s approximately three million acres of forested land.
Luke spearheaded his company’s merger with Mead Corporation in 2002 and subsequently spun off the new company’s Consumer and Office Products business to focus on more profitable ventures. In recent years, Luke purchased AARDEX Group to expand Meadwestvaco’s medication packing business, for example.
8) Kevin W. Sharer: The father of two, Kevin Sharer was born in Iowa on March 2, 1948. Sharer studied aeronautical engineering at the U.S. Naval Academy, earning a BS degree and MA degree by 1971. More than ten years later, Sharer earned an MBA from the Joseph M. Katz Graduate School of Business at the University of Pittsburgh.
Sharer served in the navy from 1972 through 1978 and oversaw the construction of the USS Memphis and the training of the vessel’s crew when he was only 27 years-old. He achieved the rank of lieutenant commander before leaving the military.
After comparatively brief stints with other companies, including AT&T and General Electric, Sharer joined Amgen, Inc. in 1992 as the biotechnology company’s president and COO. Before he retired in 2012, Sharer acted as the company’s CEO for 11 years. During his time with Amgen, Sharer increased the company’s revenue by more than $12 billion.
9) Herb Vest: Herb Vest served in Vietnam as an infantry commander. He spent more than three years in the army’s First Cavalry and 173rd Airborne Brigade and received the Purple Heart. When stateside, Vest became a lawyer and earned an MBA.
After selling his financial services firm to Wells Fargo for $128 million in 2001, Vest founded a dating website, True.com, and became CEO of his new company. When asked why he got into the business of online dating, Vest told Dmagazine.com the following:
“After I sold H.D. Vest I became bored real quick. I’m as much in favor of profit as the next guy, but I’ve always liked to have a social mission in business, to feel like I’m accomplishing something for people. So I looked at the divorce rate at 50 percent and decided we could do something about that.”
10) Alex Gorsky: Before joining the private sector, Gorsky spent six years in the army and ended his military career as a captain. Gorsky is a West Point graduate who went on to earn an MBA from The Wharton School of the University of Pennsylvania in 1996.
Gorsky began his career with Johnson & Johnson in 1988 as a sales representative. During the next 15 years, he successfully moved up the chain of command before he left the company in 2004 to join the Novartis Pharmaceuticals Corporation.
Gorsky returned to his previous employer in 2008 and was named the 2009 Mentor of the Year by the Healthcare Businesswomen’s Association the following year. Alex Gorsky was appointed CEO of Johnson & Johnson in 2012 at the age of 51 years-old. In addition to being Johnson & Johnson’s chief executive officer and staying involved with the Healthcare Businesswomen’s Association, Gorsky is on the board of the Travis Manion Foundation.