WASHINGTON — With last week’s announcement that he has joined JPMorgan Chase as a senior adviser to CEO Jamie Dimon, retired US Army Gen. Ray Odierno became the latest high-ranking officer to find a second career on Wall Street.
Odierno joined fellow four-stars Gen. David Petraeus, who became chairman of Kohlberg Kravis Roberts & Co.’s KKR Global Institute, and Gen. Wesley Clark, who became a deal adviser for the Blackstone Group’s energy sector, in working for financial firms after retiring from the military.
“Ray has dedicated his life to serving our country, rising to the top of the Army with proven leadership that delivers results,” said JPMorgan Chairman and CEO Jamie Dimon said in a prepared statement. “His experience, vision and impressive track record of success when confronting overwhelming challenges will provide significant value to our leadership team, the firm and our clients across a wide range of issues.”
Loren Thompson, a defense-industry consultant and analyst with the Lexington Institute, said the most visible, highest-ranking generals typically are in the greatest demand in the private sector.
“The appeal of retired general officers in the financial community comes down to three things: first of all, broad experience because of their frequent career rotations; discipline, which enables them to be organized and more focused than many people who have never served; and thirdly, prestige,” he said.
As chief of staff of the Army, Odierno commanded 100,000 servicemen and –women, and was instrumental in defeating al-Qaida in Iraq, Thompson said.
“You don’t get a lot of advisers like that,” he said. “I think you can’t overlook the prestige quality that a former chief of staff of the Army confers on a financial institution or a stock trader. Chief of staff of the Army is a title that grows with celebrity the farther you get from Washington.”
Retired Marine Maj. Gen. Arnold Punaro, now a consultant (whose clients have included JPMorgan, but he had no inside knowledge of Odierno’s hiring), dismissed the suggestion that Odierno was hired because of his celebrity status.
“Wall Street is extremely interested in the international business climate, they’re interested in what’s going to happen in other parts of the world, because that affects where they should and do business,” Punaro said. “They’re always concerned about risk.”
Odierno’s expertise includes cybersecurity, acquisition, risk management and crisis management, which is very valuable to companies, he said.
“They’re not looking for him to tell them how to do a battle plan to take back Mosul, they’re looking for how do you mitigate risk,” Punaro said.
Jody Miller, president of C2C Executive Search in San Francisco, said she sees lots of resumés from retired military officers. Hiring a senior officer like Odierno is a smart political move because it sends the message to Washington that JPMorgan is pro-America and pro-government, she said.
“Hiring someone like that is a very strategic move,” she said. “It’s a good image to have guys with a lot of stars come in and advise, it’s a really good, clean, all-American image.”
Not every retiring general will have the same career opportunities as Odierno, Thompson said.
“He didn’t just run a military service," he said. "He didn’t just ascend to the highest military rank. He managed to stay out of political trouble, which is not easy.”
Wall Street can be a good fit for those senior officers who have a combination of political acumen, organizational skill, demonstrated career success, and an air of being above politics in the sense of not being a creature of one or the other political party, Thompson said. Financial firms also have the ability to pay for top-tier candidates, he said.
“If you’re running a tightly managed logistics company, with thin profit margins, there’s not a lot of latitude for going out and paying some high-priced military celebrity. Wall Street will always have more discretion in terms of its ability to pay for talent,” Thompson said.
And part of the appeal for the senior officers is the ability to make up for their comparatively low military wages.Top officers typically make less than $200,000 a year. While this is not an insignificant salary, it does not compare with what someone with their skills and experiences would make in the private sector.
“If you’re a colonel, or a one-star, it may seem like you’re being reasonably paid," Thompson said. "But when you’re overseeing an entire military service, and you’re only making as much as a member of Congress, it’s easy to imagine that there are other career lines that might be more lucrative.”