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June 24 — Employees with high potential may or may not be performing optimally at present, so current performance should not be the only means used to identify them, executive consultant Brandon Heck said in a June 24 webinar sponsored by TalentQuest.
Heck illustrated the complexity of this question with a three-by-three matrix where performance assessment makes up one axis and potential assessment the other. Thus, for example, at one corner of the matrix is the “rough diamond,” a high-potential employee who is currently performing poorly, and at the opposite end is a “high professional” who is doing well but has low potential for further development.
Organizations should also beware of identifying “expertise and general intelligence” too simplistically with high potential, which “may lead you into the wrong path,” Heck said. “Intelligence may have only a 4 to 10 percent impact on performance.” On the other hand, emotional intelligence or EQ is an important component of potential in an employee, Heck said.
Research indicates two out of three companies “fairly regularly misidentify their high potentials,” said Heck, who works for TalentQuest, an Atlanta-based talent management company. This can lead companies to wrongly allocate their resources, lose true high potentials, cause some employees' careers to flounder and damage the performance of the organization as a whole, he said.
Common causes of failure to identify high potentials Heck cited include “not using predictive assessments,” a lack of structure or clarity in the organization's high potential program, and using “isolated data points” or relying on one person's opinion about employees. On that last point, Heck commented, “It's important to have a convergence of factors rather than just standing on one foot.”
High-potential employee identification should instead be multi-source, structured, objective—but not excluding important subjective assessments—integrated, driven by a shared mindset, and “not a separate series of actions, but woven into the fabric of what you're already doing,” Heck said. For example, high-potential assessment can be integrated with performance evaluation.
Heck said the question of how much potential an employee has turns on his or her capability; passion, commitment or motivation; and alignment—connectedness to the strategic mission of the company.
A company's high potential program “needs to be specific” to the company, not a set of vague generalities, Heck said. It is essential for HR to get “executive buy-in” for the program, he added, because “while these programs are often driven at an HR level and affect those below, they need to be part of the cultural mindset, the organizational mission,” and that in turn “needs to come from above.”
Many of the details about high potential assessment programs are disputed, and Heck suggested that such matters may depend on specific context. An example is what proportion of employees should be targeted for high-potential assessment. One study suggests 15-30 percent of employees should be targeted; McDonald's targets 20 to 25 percent; and others argue for a lower figure, only 5 to 10 percent, he said.
Also dependent on the context is the question of whether to tell the high potentials they have been singled out as such, Heck said. That may lead these people into getting swelled heads and thinking they will automatically advance, while frustrating other employees. But some argue it is important to let high potentials know they have been tapped.
Either way, Heck said, one should “avoid making hasty changes” about who is identified as high potential and who is not. “While the gate needs to swing both ways, there needs to be some mindful operation in terms of who you invite in and who you push out.”
Once high-potential employees, have been identified, “the best high-potential programs are generally a consultative and collaborative process as opposed to some kind of transactional dictate,” Heck said. In other words, high potentials need to be involved in “planning their own development,” he said.
Such employees also need continually refreshed feedback, and they need to be given real responsibility, meaning “the ability to set their own direction in their area” and room to make mistakes. Otherwise, your high potentials will “stay in the kiddie pool,” Heck said.
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