Do you know a high potential employee when you see one? Really? Are you sure? Does the guy who plays golf and talks a good game just seem like he should be a leader? Does an employee seem promising, because she reminds you of yourself at that age?
Identifying high potential employees is fraught with biases and opinions. Fortunately, the research literature provides some more objective guidelines for identifying high potentials.
In an earlier post, we talked about the corporate definition of ‘high potential (hipo)’ and how leaders assign the rating in succession planning. The process controls some of the human bias. A deeper understanding of the traits of hipos can further reduce bias.
Although used extensively in the corporate world, the concept of a ‘hipo’ does not get much attention in the research world. One 2018 psychology article examined the theoretical foundations of the hipo concept.
In a 2018 issue of Personnel Psychology, Finklestein, Costanza, and Goodwin wrote the article “Do your high potentials have potential? The impact of individual differences and designation on leader success”.
Importance of identifying high potentials
Finklestein et al cite several research studies that highlight the importance of hipos. Evidence indicates that a few star employees account for a disproportionately large portion of productivity.
Star employees make a substantial difference. This greater productivity justifies a larger investment of money and resources from the company. Identifying hipos early allows time for them to continue to grow, so they can be the stars of the future.
Companies also rely on a steady stream of talent to fill leadership roles. Hipos prepare to step into bigger leadership roles and fill the talent pipeline.
The label and the reality are different
One important note is that the label ‘hipo’ and actually having high potential are not necessarily the same thing. As described in an earlier post, the process to identify hipos relies on discussion and human ratings. As such, it falls prey to all of the biases and lack of information involved in any human decision-making process.
Talent Reviews, Succession Planning and the identification of hipos serves organizations and supports the talent pipeline. But these are not perfect processes. Mistakes get made. Biases come into play. Quiet people with potential might be overlooked. Charismatic people without potential might pull attention.
The authors call potential “a slippery construct” and the designation of hipos as “a noisy process”. It is hard and messy. Ratings change frequently. An employee’s status rises and falls over time. So, keep that in mind as we go deeper into the topic.
Indicators of potential
Finklestein et al examined the available research and compiled a model of how potential and the hipo designation impact leader success. They highlighted six traits that can indicate high potential. These fundamental traits support effective performance and leadership across any organization and industry.
- Cognitive ability: Cognitive ability (loosely defined as intelligence) remains a strong predictor of success at work and in leadership roles. It provides a foundation for learning, agility, decision making and more.
- Personality: Certain personality traits, like need for achievement and emotional stability, support high potentials. When considering leadership, the employee must be comfortable with people and able to maintain relationships.
- Social competence: Social competence incorporates many traits such as extroversion, warmth, social influence and understanding of social norms. The authors also mention charisma. In alignment with a previously discussed research study, charisma should be balanced.
- Learning agility: With hipos, companies are preparing leaders for the future. No one knows exactly what that future will require. Hipos must be willing and able to learn new things. They need to learn fast and apply the learning quickly as situations change.
- Developmental readiness: Developmental readiness consists of several traits such as learning orientation, self-awareness and confidence in one’s own ability to develop into a leader. Similar to elite athletes needing to be ready for mental exercises, employees need to be ready for intense development before moving into hipo developmental programs.
- Typical intellectual engagement: Typical Intellectual Engagement (TIE) refers to an employee’s interest in a wide variety of things and a ‘need to know’ the answers to complex problems. These people engage with the world and like to problem solve. TIE prepares hipos for the complex world of senior executives.
Other factors of hipo designations
In addition to the six traits of hipos, the authors discussed some additional factors in the designation process that are not individual traits. These factors contribute to the slipperiness and noisiness of the hipo designation process.
- Perceptions of potential leaders: People rely on schemas and mental models to evaluate the world. Specific schemas about what a leader looks like or acts like can skew hipo designations. These schemas can result in unconscious bias. Someone who ‘looks like a leader’ might get designated as a hipo, even if he does not show the expected traits. People also tend to have a bias for liking people who are like them. This form of unconscious bias can also skew decisions – often in favor of men and Caucasians.
- Impression management: Flattery and manipulation skills can also help an employee get noticed in the hipo process. Knowing the process and who the senior leader influencers are in the company can open doors.
- Developmental work experiences (DWEs): Developmental work experiences (DWEs) can accelerate growth of a hipo. One of the primary outcomes for hipo designation is to create customized development for them. This positive outcome has a secondary effect of creating a continued growth loop due to development, networking and visibility. In many ways, being designated a hipo could propel a borderline hipo employee into actually being one.
- Motivation: Being a hipo requires focus, internal motivation and commitment to one’s career. Many companies require hipos to agree that they will move anywhere requested, before they enter development programs. Not everyone feels this level of career motivation. For example, a highly technical person who does not want to be a leader of people or an employee comfortable in her current role are not likely to be designated as hipos.
Applying this research
This article provided a conceptual framework for identifying hipos. Hopefully, this sort of academic consideration will start firming up the definition and designation process.
Some questions to ask yourself:
- Am I interested in career growth or happy where I am?
- Does my boss know my career interests?
- Would I be considered a hipo in my company?
- How do my boss and other senior leaders perceive me?
- What should I add to my personal Individual Development Plan (IDP) to prepare myself for future opportunities?
Finkelstein LM, Costanza DP, Goodwin GF. Do your high potentials have potential? The impact of individual differences and designation on leader success. Personnel Psychology. 2018;71:3–22. https://doi.org/10.1111/peps.12225
Lisa M. Finklestein, Northern Illinois University
David P. Costanza, The George Washington University
Gerald F. Goodwin, U.S. Army Research Institute