Ahmed Rahman on What the U.S. Navy Can Teach Businesses

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In this episode of Lehigh University’s College of Business ilLUminate podcast, host Stephanie Veto talks with Ahmed Rahman, associate professor of economics at Lehigh, about his research on the U.S. Navy and what centuries of personnel data can teach businesses about developing leaders, retaining talent, and building effective teams. 

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Below is an edited excerpt from the conversation. Read the complete podcast transcript [PDF]. 

Veto: You recently returned from sabbatical, and you talked with our retired host, Jack Croft, before you left. Can you give us an overview of what you set out to study while you were away? 

Rahman: A year ago, Jack and I discussed a bunch of things. I promised three papers, which was a bit of a tall order, it turns out. But essentially, what the work entails is a study of what organizations can do to develop, to manage and to retain talent. 

I'm a human capital economist, so talent is sort of code for skills and sort of expertise in various arenas. We're focused on that for overall organizations, but the organization that I studied last year was the United States Navy. We studied three centuries, going back to the 19th century up to the current Navy today, and looked at those three questions with respect to the naval personnel. And so those three papers are titled, and I'm trying to keep it to simple titles: Quitters, Followers and Leaders. 

I think in Quitters, it's basically asking who leaves the naval profession. Followers, who are interacting with whom, based in terms of peers and mentor-to-mentee relationships. How does that affect human capital and skills and human development? And then finally Leaders, the culmination here, which is basically who rises to the top, who gets to command a ship, or run a bureau or run a big part of the naval organization. 

These are three standalone works. Obviously, I'm an academic, so as a good academic, I need to publish these in peer-reviewed works. But more broadly, just for a more general audience, I think these three works interact with each other in very important ways so that we're thinking about building, whether it's a book or a podcast or some narrative where we can connect the various things. 

It's a massive undertaking, to be honest, but it's very exciting work and I'm looking forward to plugging away at it. 

Veto: Why is the U.S. Navy a useful laboratory for understanding how large organizations develop and retain talented people? 

Rahman: It's a laboratory because experiments are happening all the time. Not on purpose necessarily. These are what we call natural experiments. And as you might guess at least early on with these young men and women, they don't have a lot of agency. They don't get to choose. They don't get to choose who they live with. They don't get to choose who's teaching them or training them. They don't even get to choose when they wake up in the morning and when they go to bed. And all that stuff, which actually is maybe not great for their lives, is actually wonderful for us as social scientists. 

We don't need to run our own experiments. The U.S. government is doing it for us, and they're doing it for us consistently, year upon year upon year. So all kinds of natural things come up from that. That, coupled with the fact that they really care about data. They document everything. We are the beneficiaries of that sort of just chronic documentation. I'm an economist, and so we consume data like candy. I think the Navy, as a laboratory for these kinds of leadership questions, is exactly the kind of institution that all organizations should actually pay more careful attention to. 

Veto: What can a centuries-old military institution teach modern companies about managing highly skilled employees? 

Rahman: I have my students here at Lehigh. They're going to graduate. They're highly skilled. They're highly motivated. And they're going to work in these large organizations. Not the Navy necessarily, but a lot of these organizations, I'll call them monopsonies. What's a monopsony? It's simply a single buyer. And in this case, what it is, is a single hirer of labor. So one thing about the Navy is really it's a monopsony for global leaders. 

For centuries if you were a young man who wanted to be a global leader, joining the Navy was the way to do it. Joining the cadre of Iron Men, serving in wooden ships, training those men, thinking about international diplomacy and relationships, learning different languages, learning technical skills on how to run a Navy, you have to wear lots of different hats. So you're playing very different roles. 

It's exactly what my Lehigh students are going to be doing in these large organizations with lots of other very skilled individuals, lots of opportunities for advancement, but also lots of opportunities to potentially take your skills and go do something else. So the fluidity that we see in modern-day labor markets is something that actually we can learn, even going back to the 19th century, with the Navy, which has always been a modern organization. Whatever era you're looking at, the Navy has implemented the highest, newest technologies in the world. And so that's actually going on currently with the present day, and so it's really exciting to be able to test these things across many centuries. I think all those things are going to be relevant for our future young men and women joining the workforce today.