Identifying the Cost of Non-Monetary Incentives (ICONIC)
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Authors
Stitt, Ryan D.
Subjects
Retention Mechanisms
Non-Monetary Incentives
Assignment Modeling
Optimization
Linear Programming
Non-Monetary Incentives
Assignment Modeling
Optimization
Linear Programming
Advisors
Gates, William R.
Coughlan, Peter J.
Date of Issue
2009-12
Date
December 2009
Publisher
Monterey, California: Naval Postgraduate School
Language
Abstract
There is growing research that explores using an array of non-monetary incentives (NMIs) to attract and retain quality Sailors. Non-monetary incentives used in this paper are: homeport choice, billet choice, platform choice and geographic stability. This research experiments with the cost of non-monetary incentives for potential reenlistment by using a linear programming assignment optimization model. The ICONIC (Identifying the Cost of Non-monetary Incentives) model was developed as a proof-of-concept mechanism to identify the cost for non-monetary incentives. Forty-five Sailors and sixty billets was the sample size used to test the assignment model. Forty-one different scenarios were run with 50 percent weight on both Navy preferences and Sailor preferences that included a variety of NMI offerings. The same forty-one scenarios were run with 100 percent weight on Navy preference and 0 percent weight on Sailor preferences, and vice versa, for a total of one-hundred twenty-three different scenarios. The number of NMIs offered in each scenario was incremented as follows: five, ten, fifteen, twenty-five, and thirty-five. PCS, training, and fit costs were used to calculate the cost of the NMIs. In general, the more emphasis placed on the Navy's cost, Sailor value decreased. Conversely, Sailor value goes up when cost is ignored. Moreover, the Sailor fit of a particular billet increases when cost is ignored. The key component of the objective function was to minimize the Navy's cost and increase value to the Sailor. In general, the model's results proved successful and showed a logical connection between the philosophical idea of how cost might behave as the number of NMIs offered increases and the heuristic assignment methodology. This proof-of-concept will continue to revolutionize the most economical way to attract and retain Sailors.
Type
Thesis
Description
MBA Professional Report
Series/Report No
Master of Business Administration (MBA) Professional Reports
Department
Business Administration
Organization
Department of Defense Management (DDM)
Identifiers
NPS Report Number
Sponsors
Funder
Format
xvi, 75 p.
28 cm.
28 cm.
Citation
Distribution Statement
Approved for public release; distribution is unlimited.