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High Potential Employees-

identification & management

Defining High potential employees

• According to Silzer and Church (2009), potential can be defined as “the

modifiability of unobservable structures that have not as yet become
actual, or exist in possibility, capable of development in actuality (…) the
possibility that individuals can become something more than what they
currently are (…) it implies further growth and development to reach some
desired end state (…).

• In work environments, potential is typically used to suggest that an

individual has the qualities (e.g., characteristics, motivation, skills,
abilities, and experiences) to effectively perform and contribute in broader
or different roles in the organization at some point in the future”.

• In a recent Harvard Business Review article, “How to hang on to your high

potentials,” the authors define potential as a person’s ability to succeed in
roles with responsibilities of greater scale and scope.
• The authors define “greater scale” as “a job in the same area but with,
say, a larger budget or staff.” “Greater scope” is “a job involving activities
of substantially more breadth and complexity
Defining High potential employees

• High potential employees are those employees

believed to have potential to advance at a faster pace
than their peers, whilst demonstrating different needs,
motivations, and behaviors than ‘regular’ employees
(Pepermans, Vloeberghs, & Perkisas, 2003).

• HIPOs are not similar to high performers because the

latter are employees who produce immediate results
but not necessarily possess aspirations or engagement.
HIPOs are the people who have the potential to
assume higher positions in the future and they
normally score well on various leadership assessment
criteria (Schumacher, 2009).
High potential employee role shift
The performance potential grid
Aon Hewitt’s Employee potential Model
CEB CLC Model of High-Potential Employee

• Ability (the
combination of
characteristics and
learned skills),
• Aspiration (the
desire for the
challenges, and
rewards of more
senior roles)
• Engagement (the
Source: Corporate Executive Board – Corporate Leadership
Council, Talent Development – High Potentials
Silzer and Church’s model depicting Key
indicators of potential
Shell’s CAR criteria for high potential
9 Box Talent Matrix
Some challenges of HIPO identification

• Evaluations of performance and potential are usually not based on

objective indicators alone, but rather reflect judgments made by top and
line management. Hence, the process of identifying talented employees is
inherently subjective, and thus susceptible to bias.
• The assumption that past performance predicts future performance,
which often underlies the identification of talented employees, is a
controversial point
• Identifying an elite subset of the organization as talents can lead to self-
fulfilling prophecies such as the Pygmalion effect—i.e., the effect whereby
expectations of performance (high or low) determine actual performance
• Labeling a small group of employees as talented has also been
demonstrated to lead to negative effects as it can lead to increased
sensitivity to feedback and fear of failure among those identified as
‘exceptionally promising’
• Allocating a large proportion of the organization’s resources to a small
number of ‘superstars’ might damage organizational morale, embittering
loyal employees and causing resentment among peers
Assessing High potential Talent

• The best practices associated with assessing

potential focus on five central components –
• Consistent with organisational culture and
future strategy
• Multiple methods
• Flexible
• Cost effective
• Promotes on going development
Development of High potential employees

• 70-20-10 Learning Rule

Learning Activities with 70-20-10 Learning Rule
Learning Activities with 70-20-10 Learning Rule
Approaches of identifying HiPo

• Tenure approach
• Manager appraisal approach
• Decision makers consensus approach
• Criteria based approach
Tenure approach
• This approach is characterized by promoting
or identifying employees that have been with
the company the longest. The general theory
is that the person has paid his or her dues and
therefore should be moved into a critical role.
Another rationalization for this approach is
that the employee, because of his/her
longevity with the company, must have
acquired the appropriate knowledge, skill and
ability to be successful in a more critical role.
Manager appraisal approach
• This approach is characterized by having a
manager identify a subordinate for
promotion or special development based on
the manager’s independent judgment of
what high potential means. In this approach,
managers are usually left to their own
devices to develop criteria from which they
base their decisions.
Decision makers consensus approach

• This approach is characterized by decision-

makers meeting as a group to discuss
employee suitability for promotion or special
development. Although better than the
previous approaches, there is usually little in
the way of criteria to help articulate what is
meant by potential. This can result in
unproductive or inaccurate decisions.
Criteria based approach

• This approach is characterized by having

criteria that articulate how a high potential
employee behaves. Decision-makers are
required to use these criteria to identify talent
and to justify their choices. Typically,
assessment tools are used to help measure
the criteria. Examples of such tools are multi-
rater feedback (360-degree) and assessment
Best practices

• Surround high potentials with quality people

• Build organizational commitment to high potentials
• Challenge high potentials by giving them highly
visible, on-the-job opportunities
• Clearly defined success outcomes
• Balance organizational and personal goals
• High potential program should be part of the
development strategy
Hipo Roadmap