To set expectations, I obviously cannot answer that question for you, but I can try to better frame the pros and cons, so that perhaps it will help in your own decision making process - if that is the boat you fall in. Keep in mind this also fits other branches, such as the Navy (Division Command):
- You get to be a Company Commander
- You might learn more about leadership and further mature
This is different for everyone. Some people feel like their O-1/O-2 time didn't give them enough of a leadership opportunity, or perhaps you have had some great Company Commander mentors and you really want to go through the steps they went through so you can get there too. Then again, if you feel like you are only going to learn a little bit from the experience, then this is not a major selling point. It all depends on where you feel you are now in terms of maturity and experience.
- You'll get more Post-9/11 GI Bill Benefits
This is really on the margin, since additional GI Benefits might just lower the financial aid you would have gotten anyway, and either way, the reduced salary over the next few years will not make for the GI Bill benefits (see cons below). However, to those that are extremely risk averse and have families worried about surviving in b-school, then this is indeed a positive... though I really hope nobody stays to lead troops primarily for GI Bill benefits.
- Your age upon leaving service will make you less competitive for HBS and Stanford, and to a lesser extent, other schools. See my analysis at age at HBS here.
- You will be entering your new career older, and likely working for people younger than you
Some people won't really care about this, but it's something you need should know about. Traditional post-MBA jobs are the same whether you are 27 years old or 37 years old. A first year consultant at McKinsey or a banker at Goldman Sachs gets treated the same after b-school, and has the exact same job whether you have 2 years of military experience or 12 years (I've seen this exact scenario play out of HBS - these are not made up numbers). Keep in mind that the added maturity and military experience may actually make you more competitive for the position, and may certainly help you perform better in the job itself, but it's important to understand that it is in fact the same job after business school, and you will be working for the same person as you would have otherwise.
- You will be giving up significant lifetime income opportunity
The caveat to all this is of course is that if the added military experience, leadership, and maturity makes you into a better leader, then the numbers may not work, because you could argue that you would achieve more in the private sector with given added experience than you would have otherwise. The numbers only assume you would emerge from the military with similar leadership competencies... so only you can really make the determination of where this assessment fits you. Most are naturally somewhere in the middle.
- You might learn a lot of bad habits from the military that won't help in the private sector
Certainly leadership experience in the military is generally superior to that of the private sector. However, depending on where one actually goes within the military bureaucracy, you may just pick up a bunch of bad habits; also known as becoming too "institutionalized." This is largely dependent, in my opinion, of how your time in military will actually play out, who your commander/mentors will be, and what kinds of opportunities you may have. If all your unit does is enforce haircuts and deal with "dental readiness" - then you may not get a tremendous boost from the experience. Also keep in mind that generally speaking, the longer one stays in, the more inertia he has to continue on the path. This is neither a pro or a con necessarily, but it is a reality.
- Given the above point, keep in mind whether or not you will deploy as a Company Commander
Being a Company Commander is one of the best jobs one can have in the military. It's an honor that shouldn't be taken lightly or taken for granted. If serving as a Company Commander is important to you, then you probably don't want to risk regretting the lost opportunity later in life. If on the other hand you are ambivalent about the experience, and think that it will somehow actually help your MBA and post-MBA career path, then hopefully you now you see that is not necessarily the case.
For more thoughts on staying in, getting out, and when, read my article on Military versus MBA and private sector careers.