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Regardless of the size of the organization, identifying high-potential employees (HiPos) should be on the radar of every manager and HR department.
Not only do high potential employees make a significant impact in their current roles, but they can also be prepared for future leadership positions within the company.
Research shows that high potential employees are 91% more valuable to an organization than non-HiPos. But surprisingly, adding a HiPo to a team boosts other team members’ productivity and performance by up to 15%.
Sadly, not all leaders know what to look for when assessing talent, nor possess the skills to develop and retain these individuals. Too often, HiPos are not identified early enough and therefore are not given the proper attention and training they need to reach their full potential.
To make sure your organization is not losing out on top talent, we'll discuss the traits of high potential employees and how to identify them.
What is a high-potential employee?
Consider these two revealing definitions to help you better identify high-potential employees:
“A high-potential employee (HiPo) is someone with the ability, engagement, and aspiration to rise to and succeed in more senior, critical positions.”
- Gartner
“A HiPo employee is a person who has been identified as possessing the ability and the potential to not merely be promoted, but to ultimately ascend to the most senior levels of the organization.”
- Society for Human Resource Management (SHRM)
These definitions highlight the importance of identifying high potential employees’ skills and how they translate well to leadership.
They go beyond just being competent in their current roles and demonstrate a desire to learn and grow by taking up more challenging roles and responsibilities.
There’s another consideration to make, however, when identifying high potential employees, and that’s clarifying the difference between HiPos and high performers.
The crucial difference between high potentials and high performers
While certain traits come to mind when thinking about high potential employees, they usually overlap with those of high performers.
Reliable, hard-working employees who excel in their current role and consistently deliver outstanding results can be both considered high potentials and high performers.
But just because someone is a high performer doesn’t necessarily mean they have the potential to take on bigger roles. Similarly, not every HiPo is a high performer.
HiPos possess certain attributes that make them stand out from their peers—only about 15% of high performers are considered high potential. HiPos also show potential for growth and development into leadership roles.
3 reasons why you should identify your high-potential employees
High potential employees will be the individuals pushing your organization forward. They’re indispensable. They’ll be the ones taking on important roles, leading projects, and offering innovative solutions that shape the company’s future.
But beyond that, HiPos can also be a great source of employee loyalty and motivation for your organization.
1. Retention
More than anything, HiPos are more likely to stay with your company for the long term. But only when they are recognized and given the opportunities to develop their skills.
In fact, 64% of employees say they’re more likely to stay with their organization when given better opportunities to learn and grow. These growth and development initiatives can help your organization keep high potential employees long term.
2. Succession planning
While succession planning may not be the most exciting aspect of management, eyeing certain individuals for future leadership roles is essential for the long-term stability of any organization.
Not only does identifying high potential employees and succession planning give managers a greater sense of security knowing they have a strong bench, but it also allows HiPos to be groomed and prepared when your top talent leaves or retires.
3. Competitive advantage
More than 40% of leadership roles we know today will be different in the next five years.
Compared to other employees, HiPos are more likely to have a better understanding of the environment, the business, and customer needs.
With this, HiPos are more than just employees who show promise–they are future, dynamic leaders that can help your organization stay ahead of its competition.
Tools to identify high potential employees
As it stands, only 57% of companies have a formal standard for high potential identification. Rather, they rely on the instincts of management from observations and performance reviews.
While many organizations have a systematic approach to evaluating employees, a more holistic approach needs to be taken when it comes to identifying high potential employees.
The High Potential Trait Indicator (HPTI)
The High Potential Trait Indicator (HPTI), now known as the Thomas Personality assessment, is one of the tools to identify high potential employees—developed by Ian McRae and Adrian Furnham in 2006. It evaluates employee performance on seven criteria:
- Acceptance
- Adjustment
- Ambiguity
- Competitiveness
- Conscientiousness
- Curiosity
- Risk Approach.
Based on the ‘optimality’ model, it assumes that an individual’s personality traits can be an indicator of their potential to become a high-performing employee and future leader.
9-box talent review
The 9 box talent review is one of the more popular tools to identify high potential employees within a company. This model assesses employees based on two factors: performance and potential. Employees are then put into one of nine categories on the 3x3 grid.
Before using this tool, you need to define what performance and potential mean to your company.
- Performance: Goal achievement, key performance indicators, technical skills, and adherence to company policies.
- Potential: Indicators of future growth, such as learning agility, leadership qualities, and strategic thinking.
Situational Judgement Tests (SJTs)
SJTs are another one of the tools to identify high potential employees you can use. Their goal is to assess an employee’s ability to handle real-world work challenges and evaluate critical soft skills like:
- Decision-making
- Problem-solving
- Communication
- Conflict resolution
These tests will run employees through hypothetical scenarios relevant to their current or future role and ask them to formulate a plan of action with justifications. This will help you identify high potential employees beyond just technical skills and competencies.
Emotional intelligence tests
Evaluating emotional intelligence is also a part of identifying high potential employees. Emotional intelligence, meaning the ability to recognize, understand, and manage one’s emotions while navigating interpersonal relationships is a large contributing factor to workplace success.
Tests, like this one from Workplace Strategies for Mental Health, run the employee through questions around topics like:
- Their current ability to handle stress
- What triggers certain emotions and why
- How they address concerns in the workplace
- How they communicate in certain situations
Employees with high emotional intelligence are better at handling stress, collaborating with others, and leading with empathy—making them key candidates for your list of high potential employees.
5 ways to identify high potential employees in your organization
Only 15% of high performers are actually high potential employees. Aside from the obvious, here are some qualities that’ll help you identify high potential employees:
- Takes initiative and suggests new ideas
- Willing to go out of their way to help others
- Pushes boundaries and challenges the status quo
- Embraces change and adapts quickly
- Takes feedback well and strives for improvement
- Seeks out new opportunities to learn, grow, and develop professionally
- Shows leadership potential by driving projects forward without being asked
Relying on your gut will be important, but there are concrete tasks you should complete when making the call on whether or not an employee has potential to ascend the ranks.
1. Measure key performance indicators
Any good manager should use hard assessment data from performance reviews, surveys, and other feedback to measure the performance of every employee.
From the usual key performance indicators (KPIs) like sales figures and customer satisfaction to more specific ones like innovation, creativity, and risk-taking, keeping an eye on KPIs is a core part of the high potential identification process.
2. Look for intelligence and problem-solving ability
High potential employees are usually both intelligent and good problem solvers. They don’t just come up with solutions to problems, but they also look for ways to improve processes and develop new strategies.
For example, while an intelligent employee can think of ways to solve a problem, a high-potential employee will find and implement strategies to prevent the same issue from recurring in the future.
Thinking through if an employee is both a skilled problem-solver and highly intelligent will help in your high potential employees identification process.
3. Talk to them about their desire to take on leadership roles
High potential employees don’t just want to do their job efficiently; they also have the ambition and drive to take on bigger roles.
When identifying high potential employees, talk to them about their long term career goals and see how they respond. These conversations can provide valuable insight into how much potential each employee has and the roles they might be best suited for in the future.
4. Assess for high emotional intelligence
Possessing a high level of emotional intelligence is an important trait for HiPos.
As such, assessing emotional intelligence should be a part of managers’ high potential employee identification process, observing how they interact with colleagues and customers.
Are they able to stay calm in difficult or stressful situations? Do they show empathy when communicating with others? How well do they handle criticism? These are all questions to help identify high potential employees.
5. Talk to their colleagues and managers
Diving into the feedback of colleagues and managers can provide important insights about an employee’s potential.
Leaders should check in with managers and team members to get an idea of how well the employee works in a team environment and other key information that can help make an informed decision. Ask for candid opinions on their strengths, weaknesses, attitude, and behavior.
This strategy provides a more holistic view of the employee’s performance, which can be used to identify high potential employees in your organization.
How to identify high potential employees and develop them
Before using any specific methods or tests to identify high-potential employees, every organization needs to establish a benchmark for what it considers to be “high potential.”
It could include standards such as:
- Demonstrates leadership skills
- Has a track record of consistently exceeding expectations
- Willing to take on challenging roles and projects
- Commits to continuous learning and development
Once you've identified what constitutes high potential, it's time to start assessing your current employees and build the base for a high potential development program.
- Give them more challenging work: Letting them take on tasks that are outside of their current job descriptions will help build their skill sets and give them a sense of ownership over the projects they complete.
- Provide mentorship opportunities: Offer high potential-focused mentorship programs that will allow your HiPos to shadow senior members for an up-close look at how things are done in higher positions.
- Offer regular feedback and recognition: Praise your HiPos for the work they do with different types of recognition and provide constructive criticism when necessary to help them grow.
- Set up career progression plans: Investing in career progression plans will give your HiPos a clear path to follow and ensure they stay motivated.
Nurture your high potential employees
Identifying high potential employees and helping them grow is one of the most effective ways to make sure you retain your top talent and see the most benefit from their hard work.
Paying attention to the traits we’ve discussed above and using tools to identify high potential employees such as HPTI can help you spot potential stars in your organization.
Creating a HiPo program is a great way to prepare the right people for higher-level positions. But incorporating mentoring takes it to the next level and allows employees to learn from their managers and other experienced professionals.
With Together’s mentoring software, you can create and manage your mentoring activities with ease, making sure that your HiPos are getting the best guidance, support, and network to meet the organization's future needs and stay ahead of the competition.
See how Together can help you nurture your high potential employees—book a demo with one of our experts!
