臺大管理論叢 NTU Management Review VOL.29 NO.2

An Estimation Model for Evaluating the Impact of Changing Officers’ Minimum Time in Grade and Maximum Time in Service on Officers’ Future Pension Payment 92 2. Design/Methodology/Approach This study refers to Alam's (1985) steady state career structure model, and considers the wastage rates of each grade to construct a Modified Steady State Career Structure Model (MSSCSM). Combining the MSSCSM with manpower costs of each grade, a human resource financial model, i.e., an Estimation Model for Military Officers Future Pension Payment (EMMOFPP), is established. By using the MSSCSM, we can evaluate policies with different time in grades for promotion, and service time for retirement. The policies’ results are then input into the EMMOFPP to estimate the impact of these policies on the future pension payment for newly retired officers every year. Military organization is a hierarchical organization. There are 9 ranks in officers: second lieutenant, lieutenant, captain, major, lieutenant colonel, colonel, major general, lieutenant general, and general. The lowest rank being second lieutenant and the top rank being general. Upon recruitment into the army, an officer serves as a second lieutenant and ascends the promotion ladder from one rank to the next rank. In order to enable officers to acquire the required competencies, knowledge, skills, or abilities, and or the appropriate level of education, they must spend a minimum number of service years in each rank before becoming eligible for advancement to the next rank. In the current system, the minimum service years for promotion in the ranks of second lieutenant to lieutenant general are 1, 3, 4, 4, 4, 6, 6, and 6 years respectively. In other words, an officer must at least serve 8 years before being promoted to major. An officer would continue to serve in the same rank, if not promoted, until he/she retires. To avoid aging of the military and to maintain vitality, each rank has a maximum service time for retirement. The maximum service time for retirement in the ranks of second lieutenant to general are 10, 10, 15, 20, 24, 28, 34, 37, and 41 years respectively. In other words, if an officer at the time of entry into service (i.e., as second lieutenant) is 23 years old, he/she must retire at age 51 (23 + 28) in the rank of colonel if not promoted. To compare different service times for promotion and retirement with the current system and to understand their effects on future yearly pension payment of newly retired officers, this study proposes that the maximum service time for retirement for major, lieutenant colonel, and colonel should be extended 4 years, and 2 years for major general, i.e., 24, 28, 32 and 36 service years respectively. Minimum time for promotion from second lieutenant and captain should be extended 1 year, i.e., spending 2 and 5 years before promoting to the next rank respectively.