Yeah -- it's pretty common inside management consultancies, too (which is the model Meg Whitman tried to impose at eBay. I don't think it helped them.)
The military at least has less rotation in the Warrant Officer system (you can be a pilot for ~almost your whole career, or a comms expert, etc.), and has decent programs for technical expertise development for enlisted (until you get past E-8, but E-8 is a great terminal rank). There's a difference being a Blackhawk pilot with a combat units vs. medevac vs. 160th, but it's not that big a difference vs. running an infantry company to a staff officer position in an occupation force to running an acquisitions program in DC.
The officer corps really does seem to sacrifice a lot in order to create O-6 and in particular general officers. If the goal were just to produce the best possible company and field grades, you'd probably do something more similar to how warrants are handled.
One of the biggest problem the military has (in jobs like occupying a country) is gratuitous individual rotation. I spent more time in Iraq than ~any military officer I ever met, because I actually lived there. There were KBR cafeteria workers who spent the entire conflict, and truck drivers who knew more about the situation (by virtue of driving on the roads for 5 years pretty much straight) than the military responsible for them.
The solution to that, IMO, would be to assign higher level units to tasks, and then rotate their subordinate units through on a repeating basis. e.g. 1CAV should "own" Southern Iraq for the duration, and HQ elements should remain in place the whole time. Individual BDE could rotate through. This was essentially the British Empire model. For other capabilities, at least rotate a unit back and forth to the same area -- 6mo rotations would be fine if it were half on, half off, to exactly the same thing; sort of similar to how the navy blue/gold crews worked.
It is way too easy to win on OERs by checking boxes vs. actually doing anything. You end up with people making meaningless changes when something is already fine (sometimes, cycles every other commander!) just to make their mark and get something on the OER.
I personally have respect for JSOC and for combat arms during wartime as a good model for leadership (all the way from E-4 through O-6; never talked to people much beyond that), but I don't think the military model in the US works during peacetime or in roles outside combat arms, medical, aviation, or SOF.
Another interesting model for all of this is how the Soviet officer structure worked -- they'd put their best available candidate into a role, but wouldn't promote him to the official rank right away. You could end up with a Colonel commanding a Corps if he was the best guy available. There were maximum ranks for various positions, but not minimum ranks.