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The Leadership Incubator

Does Your Company Need to Rethink High Potentials?

By Nancy D. Solomon | 5-min read


This article was originally published on The Leadership Incubator and is republished here with the author’s permission.

I really wanted to attend the training, but since I’m not a HiPo my company won’t give me time off.

My boss only pays for coaching if you’re designated a high potential employee, so I’m going to have to figure out how to pay for it myself.

We allocate budget for HiPos only, so if he’s not a HiPo I can’t help him.

These are the verbatim conversations that spurred me to go on a mission to help reinvent the High Potential (HiPo) classification or, at the very least, help rethink it.

I invite you to come along.

First, let’s look at the numbers together.

According to Harvard Business Review, 5% of employees are HiPos. Gallup reports that engaged employees are now 33% of the workforce. Which means that 27% of employees are engaged, but not classified as HiPos.

I’ll get to why that’s significant in a moment.

Perhaps, the most confounding issue with the HiPo designation is that it’s nebulous, fluid and subjective and, therefore, positively correlated to unconscious bias—the very phenomenon on which many companies are now doing mandatory training.

The criterion for High Potentials not only varies from company to company, but also within the same organization, and from manager to manager.

As you’ve probably already experienced, the quality of your manager and your relationship with that person will largely determine your success in your company. Or your failure to succeed.

Can You Afford to Neglect 27% of Your Employees?

The unintended, but not inconsequential, impact of HiPo programs is a decrease in the morale, ambition and longevity of those who are not selected to be members of this elite club- the notHiPos.

That’s a high price to pay, given that “companies are bad at identifying high-potential employees”

    • > 40% of individuals in HiPo programs may not belong there

    • 42% are below average in leadership effectiveness

    • 55% of HiPos drop out of their program within five (5) years (Corporate Executive Board – CEB), and

The 27% of engaged employees who don’t get the special recognition and perks that accompanies this coveted status are, default, relegated to the status of “other.”

“Other” people inevitably feel left out, rejected and unwanted which, ultimately, leads to disengagement. These are the folks who often become flight risks. This is the intellectual property that vanishes out the door.

If you’re thinking, “But no one knows who we select for the HIPo Program,” you’d be wrong.

Who’s who in the HiPo culture is likely one of the most open secrets in your organization.

Both cohorts (HiPo and notHiPo) know what group they’re in, and membership in both of them has real and measurable consequences.

Everyone, including the HiPos themselves, knows that they are the people who are singled out for leadership training and development, conferences, sponsorship, coaching, rewards, Skittles, whatever. They might as well hang a sign around their necks; it’s that obvious.

Now back to our 27% notHiPos…

Being left out doesn’t inspire people to want to make their best contribution, and have the most positive impact on their organization. Sure, there are people who don’t care if they graduate to HiPo, but many do.

The feeling of “other” is further exacerbated when managers are unable to tell them exactly what they need to do differently to earn the elusive HIPo status. It’s not that these managers are necessarily holding back, it’s often that they, themselves, have no idea what it takes.

This is particularly challenging for women whose performance reviews are less constructive and more personal than the reviews of their male counterparts, which are geared toward suggestions to develop additional skills.

Do You Want to Retain Talented People?

This 27% of the engaged employee population is what I’ve coined, The Unheard Third™ (though not quite a third right now, it’s close enough for the sake of conversation.)

Over the years, I’ve trained a lot of these people. Hundreds of them. In fact, I love working with them as much as I love working with HiPos: Most are ambitious, inspired and determined to succeed. Many of them are “Unheard” simply because:

    • They don’t have a manager who values their contribution

    • They’re in a position that doesn’t allow them to leverage their strengths

    • They don’t have a strategic plan in place for their career advancement

While one might decide they lack career maturity or executive presence, The Unheard Third are usually very passionate, curious and optimistic. They put their Growth Mindset into overdrive, and their desire and determination to use their potential is palpable.

Many of these notHiPos say they want a position that they can grow into. The position they talk about, that they plan for, will challenge them to be their best. They’ll have the autonomy to use more of their potential, and it will prepare them to become HiPo leaders, themselves.

These are wonderful problems to have; they speak to issues that are solvable given the right training, mentoring, and a well-matched manager.

It’s hard to capture, in words, the disillusionment and sense of frustration experienced by an engaged employee when he or she discovers that leadership went outside the company to fill an enviable position; a position this person really wanted.

Sure, it’s sometimes necessary to bring in fresh talent, perspective and experience. But at what cost?

In a time when companies are eliminating entire layers of leadership, trimming staff and requiring employees to do so much more with so much less, can you really afford to overlook the talent in your own backyard?

If your org can’t allocate budget to train the Unheard Third, how can it afford the resources to search for new talent when tenured employees leave in search of more expansive opportunities?

Wouldn’t it make sense to fully discover the potential of the talent you’ve already hired; the ones who already understand your culture, and are waiting for their turn to shine? “Waiting” being the operative word.

If employees don’t know what you’re looking for in your most elite talent pool, how can they possibly deliver? That’s right, they can’t. So, tell them precisely what they need to do. Then train them to do it. Create a mandatory mentoring program. Get them coached. Do whatever it takes, because replacing them is very expensive, and the money is the least of it.

Nancy D. Solomon, MA Psych, CEO and Founder of The Leadership Incubator, is on a mission to help Fortune 1000 companies turn individual, team, and organizational potential into measurable performance. Known as The Impact Expert, she is a main stage speaker, expert trainer and veteran coach who helps leaders solve key issues related to leadership development, employee engagement and advancing women. Nancy has made a difference for such companies as Microsoft, Target, Acura, Westin, Nordstrom & ADP and with many passionate individuals.