Navy Sends Top Brass for Business Training

WELLESLEY, Mass. -- Professor Neal Thornberry looked at his new class of students and could see the jitters.

"They were a little antsy," he said. "They're not used to sitting around on land for so many hours."

The U.S. Navy, in an effort to run more efficiently, is sending its admirals back to school to learn how to think more like entrepreneurs. On Thursday, a dozen admirals and a handful of other Naval leaders completed a week of executive education classes at Babson College.

The admirals spent four days attending sessions on such topics as "Organizational Innovation" and "Using Effects-Based Thinking." They ditched their uniforms in exchange for khakis and casual sweaters and dispensed with formal titles to call each other by nicknames like "Sully" and "Arch."

Emphasizing collaboration and negotiation is new for many admirals, but retired Vice Adm. Phil Quast, one of the architects of the program, said things are changing.

"There was a rice bowl mentality where people would protect their resources and not share with others," he said. "People who are dictatorial don't command ships anymore."

One of the biggest challenges for the new students was applying principles from the for-profit sector to the Navy. Thornberry explained that in the business world, an opportunity is a way of creating economic value. In the Navy, however, an opportunity is a chance to use resources efficiently.

After Defense Secretary Donald Rumsfeld laid out plans to transform the Department of Defense, Quast got a call from Adm. Vern Clark, then chief of naval operations. Clark told him it was time to send leaders back to school to equip themselves with modern business skills, Quast said.

It made sense to Quast, especially given the massive size of the Navy's operations. There are 280 admirals in the Navy who have a collective budget of $190 billion and command a work force of 700,000 people, including active and reserve officers as well as personnel and civilians.

Recent budget changes also have forced the Navy to function more efficiently. Facing rising war costs, the Pentagon has had to reevaluate its overall defense plan and scale back some Navy funding.

"Readiness at any cost was never looked at as being bad in the past," Quast said. "Now it's readiness at the lowest cost. We are no longer an institution of consumption."

Since that phone call four years ago, Quast, a former adviser to the California State University system, has helped set up executive education programs for Navy admirals at the University of California at Berkeley and San Diego, and the University of North Carolina.