Identifying, developing and nurturing HIGH POTENTIAL EMPLOYEES

I had written an article for the award winning e-journal of the Learning and Development Group. This appeared in the July – Sep 2014 issue. Download this issue from

To retain high-potential employees, the conventional wisdom is deceptively simple:

  • Identify, develop, and nurture them.

Many companies attempt to identify high-potential (HIPO) talent early in the employees’ careers and they invest heavily in nurturing this talent. Often succession planning is the name given to it, and it isn’t just about identifying and grooming candidates for a few top roles. It is about identifying and nurturing your high performing, high potential employees so that you can retain them and support their career progression.

These are the people who can easily walk out the door and find another job. They’re often the ones who embody leadership, whether or not they’re in management roles, and often hold a disproportionate amount of corporate IP and/or memory. They’re the ones you really need to keep.


To retain high-potential employees, the conventional wisdom is deceptively simple: Identify, develop, and nurture them. Paying special attention to the very best people will enable them to stay with the firm and eventually emerge as key leaders.


But translating this into action is much more difficult. There’s a difference between doing it and really doing it. Many firms have trouble keeping their best people, despite their investments in talent management. In fact, a 2010 study by the Corporate Executive Board indicated that “25% of employer-identified, high-potential employees plan to leave their current companies within the year, as compared to only 10% in 2006.” The study also found that 40% of the internal job moves for high potentials ended in failure.


What do we need to do for this?

  • Know who your real high potentials are

Corporate leaders typically look to the top-rated 3 % to 5 % of their employees as candidates for fast-tracking. In Harvard Business Review, researchers Jay Conger, Douglas Ready and Linda Hill describe high-potentials as individuals who “consistently and significantly outperform their peer groups in a variety of settings and circumstances. … They exhibit behaviours that reflect their companies’ culture and values in an exemplary manner. Moreover, they show a strong capacity to grow and succeed throughout their careers within an organization—more quickly and effectively than their peer groups do.”

The first step is to know who your high potential employees really are. It’s a common mistake to think that all high performing employees also have high potential. We often misconstrue a high-performing employee for a high-potential one. By doing this, we make a costly error in management and are risking the loss of real talent. We look out into our ocean of employees and can quickly spot those ‘high profile’ high-performers who stand out in the crowd. Often, our appraisal systems create this situation. Then there are the high-potential employees who are often left on their own and forgotten. They are hired, trained (maybe), and given attention when it is convenient, but they are often low maintenance so they fall under the radar.

But don’t be mistaken – low maintenance does not equal low potential, as these professionals are often simply doing their jobs and going unnoticed. Bersin by Deloitte defines a high potential employee as one “who has been identified as having the potential, ability and aspiration for successive leadership positions within the company.”

It’s important to determine whether your high performing employees want to move up in your organization. That’s the aspiration component of what being a high potential employee means. Also keep in mind that leadership doesn’t necessarily mean climbing the management ranks. An individual contributor who has the potential to increasingly specialize and demonstrate leadership in their area can also be a high potential employee. Start by identifying what constitutes “high potential” in your organization, then use your succession planning mechanism to get managers to rate their employees’ potential. At the same time, ask managers to rate their employees’ readiness for promotion, and to identify any who are at risk of leaving and why.


  • Develop your high potentials

Now that you know who your true high potential employees are, put plans in place to further develop them and support their career progression. Developing high potential employees does not only mean building them up to be people managers / leaders. Good succession planning will let you create talent pools that define the competencies required for success and progression in a particular area — like executive leadership, customer service, R&D, product management, etc. — the level of skill or proficiency required, and the learning activities that can help to develop them. You can then assign your high potential employees to appropriate talent pools for development. Conducting a baseline evaluation of your high potentials’ demonstration of talent pool competencies, assigning them appropriate development plans, then re-assessing their performance at regular intervals. This kind of development planning and management is a key contributor to employee engagement and retention.

Here again, succession planning makes the tasks easier and lets you aggregate and analyze ratings to track everyone’s progress. And it should give managers and employees easy access to the employees’ development plans, so they’re acted on, not set aside and forgotten.

  • Take action to retain your high potentials

If managers flag any high potential employees as being at risk of leaving, take appropriate action to retain them where possible.Sometimes, simply being acknowledged as a high potential employee, and being given the opportunity to develop and progress in their career, is enough to retain someone. Other times, you’ll need to take other actions, like adjusting their compensation, giving challenging work assignments, assigning a mentor, etc.Succession planning can help you identify those at risk of leaving and ensure the actions you take are reducing that risk.

  • Promote them when ready

Whenever a new position opens up in the organization, look first to fill it from your internal talent pools. Your planning earlier can help you determine your high potential employees’ readiness for a promotion or new assignment, and give you data to consider a potentially larger pool of candidates for a role than you initially had in mind. It can also help you identify areas where your talent pools are small, or where development activities aren’t effectively preparing high potentials for career advancement. In both cases, you can then take action to ensure you strengthen your talent pools.

  • Succession planning: a critical tool for success

Succession planning is critical for any organization. It helps you identify, nurture and retain your high potential employees and ensure the future success of your organization.By automating the processes and tasks that make up effective succession planning, and by aggregating vital data about performance, potential and development, succession planning helps you target your actions and make more effective decisions about who to develop, who to promote, and when to take action to retain.

It’s a good idea to repeat these assessments at least yearly to maintain a current data set, and to compare results year over year.


Execution, based on employee levels

The development has to chip in at all levels.

• Associate / Agent level

• Team Leaders to Managers

• Delivery leaders

• Executive Management

Any program will usually not be mutually exclusive for each of the above levels.For the first two levels, we may need programs which are function / knowledge specific, comprise of certification, both internal and external, we can use customized programs, covering cross geography orientations as well.For the second and third levels, the focus needs to be changed to build future leaders, both on people and subject matter fronts.And then for the last two levels, executive leadership enhancements, development of multi function and multi tasking capabilities will become critical. The strengths of knowledge and empathy has to be embodied into employees of these two levels.

As Managers & Leaders, we need to play a big role in building a pipeline of thriving talent, and it’s increasingly important that do this successfully. While employee development is no cake walk, failure to assess potential versus performance is a very real leadership problem. It simply takes dedication to identifying high-potential and high-performing employees, assessing their competencies, attributes and training needs, and then putting them on the right path to success.

This is what will lead organizations to great heights…


Mohit Gupta,

Managing Director,

SigmaTrail Consulting Pvt Ltd.