EFFECT OF COMBAT SERVICE AND MILITARY RANK ON ENTREPRENEURIAL CAREERS: THE CASE OF ISRAELI MBA GRADUATES*, THE

Journal of Political and Military Sociology, Summer 2003 by Avrahami, Yoash, Lerner, Miri

This study examines whether military service in a combat unit and in a leadership position is associated with entrepreneurial activities in the ensuing civilian career. It also examines whether an officer rank is a determining factor of entrepreneurship. Following the Institution/Occupation thesis that appears frequently in the military sociology literature, in combination with leadership theory and the theory of social capital accumulation, it was hypothesized that patterns of service that can be characterized as institution-oriented enhance motivation to embark on an entrepreneurial career more than service that is characterized as occupation-oriented. The effect of combat experience and rank on the choice of an entrepreneurial career was examined on 166 graduates of business administration (MBA) in Israel, controlling for gender differences. Combat service and risk-taking propensity were the main variables distinguishing entrepreneurs from non-entrepreneurs in the regression of the male sub-sample. In contrary, an officer rank was not a significant distinguishing factor among them.

INTRODUCTION

Are certain patterns of military service, especially those including leadership positions, associated with eventual entrepreneurial careers? This question of the long-term effect of military service upon entrepreneurship is the focal point of this study. Entrepreneurship is commonly defined as the creation of a new organization (G�rtner, 1985). Much has been written on the role of experience as a determinant of choice of entrepreneurial careers, with previous experience in the industrial sector and previous entrepreneurial experience having been found to have an important impact on business formation (Reuber & Fischer, 1993; Bird, 1993). Military service, by definition, belongs to the past experience of individuals and is an antecedent of their eventual post-military careers as civilians. Since military service is a total experience that can affect personality, skills, aspirations, goals and career directions quite broadly at a transitional and formative time of life, the overall effect of military service on future careers constitutes an important question (Cohen, Segal & Temme, 1986:303). The viability of the military as a provider of training with a linkage to the civilian work world has been documented in the literature (Magnum & Ball, 1987). In this paper, however, we address the link between certain types of past military service experience and pursuing an entrepreneurial civilian career, a question that rarely has been examined systematically.

In contrast to the popularity of research on determinants of entrepreneurial careers, there is a dearth of studies that explicitly incorporate military service among the variables under examination. This study aims to contribute to this unexplored question. We examine this issue in the context of Israel, which represents an interesting case as obligatory service in the ranks has become the most widely shared of all national experiences (Lissak, 1994; Cohen, 1995), and where economic entrepreneurship has become an attractive career choice.

Military service is an important socialization stage in the career of almost every Israeli adult, female and male. With the significant exception of most Arab citizens, almost all Israeli youngsters are nominally liable for draft into the Israeli Defense Forces (IDF) when they reach the age of eighteen. Male soldiers must serve for three years in the standing army, and they have a further obligation to serve in the reserve army up to the age of 50, whereas female soldiers serve twenty months (Williams, 1989).

Some factors combine to condense the potential long-term effects of military service on the future careers of young Israeli adults. The most important factors are the length of service and its nature. In many of the special units of the IDF, there is a requirement for a longer period of service - sometimes four years or even more. The IDF invests huge efforts in training the newly enlisted in a wide range of technological skills, which they later use in the remainder of their service. This concentrated technological training enables many draftees to acquire new skills and access to the world of technology. Research and development knowledge accumulated in the military system accounts for much of the development of know-how in the hi-tech sector of entrepreneurial startups that have been flourishing in recent years (Lerner & Avrahami, 2000; Sokolovetal. 1999).

Apart from the technical and technological skills that the military service provides for many draftees, service in combat units exposes them to leadership processes inherent in their training climate. The literature indicates a significant impact of transformational leadership training on the performance of the trainees (Bass, 1985, 1996; Dvir, 1998; Popper & Ronen, 1992). The combat unit experience fosters certain personal behavioral features such as taking initiative, risk taking, flexibility, fast adaptation to a new environment, team building, mutual support, and self-efficacy (Dvir, 1998; Gal, 1986). Some of these behavioral features have been found to characterize entrepreneurs.