How to Identify High-Potential Employees (Characteristics & Criteria)

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.

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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)

At their core, high-potential employees possess skills that translate seamlessly into future leadership roles. They look beyond their current competencies and actively look for opportunities to learn, grow, and handle complex business responsibilities.

High potential vs. high performer: What’s the difference?

While certain traits overlap, it is critical not to confuse a high performer with a high potential employee.

• High Performers excel consistently in their current role. They meet quotas, hit operational benchmarks, and are incredibly reliable individual contributors.
• High Potentials possess the agility, strategic curiosity, and ambition to grow out of their current role and succeed within senior leadership positions.

Only about 15% of high performers are actually high potential employees. A high performer may be perfectly content remaining the operational backbone of their team, whereas a high-potential employee is constantly driving towards broader corporate strategy.

3 reasons why you should identify your high-potential employees

Identifying high-potential employees early protects your organization against leadership gaps and talent flight. But beyond that, HiPos can also be a great source of employee loyalty and motivation for your organization.

1. Retention & engagement

HiPos crave development. Statistics show that 64% of employees are more likely to stay with their organization when provided clear pathways to learn and grow. Identifying them allows you to deploy targeted development programs before they look for opportunities elsewhere.

2. Strategic 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. Identifying your HiPos allows you to build a reliable talent bench, making it seamless to fill critical executive roles when top talent retires or moves on.

3. Accelerated Competitive advantage

More than 40% of leadership roles we know today will be different in the next five years. With modern leadership demands shifting rapidly, HiPos provide a distinct competitive edge. They learn faster, adapt to industry disruptions with ease, and require less long-term structural onboarding compared to outside hires.

Core characteristics of high-potential employees

Before deploying assessments, look for these natural characteristics and criteria in your day-to-day operations:

• Initiative & high agility: They don’t wait to be told what to do; they proactively step up to solve operational bottlenecks.
• Composure under pressure: When a crisis hits, they remain calm, objective, and solution-focused.
• Strategic curiosity: They look beyond their immediate tasks and ask thoughtful questions about company-wide goals and decision-making.
• Natural peer leadership: They naturally step up to support and coach overwhelmed colleagues, even without a formal manager title.
• High coachability: They accept detailed feedback constructively and instantly apply it to improve their performance.

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:

1. Acceptance
2. Adjustment
3. Ambiguity
4. Competitiveness
5. Conscientiousness
6. Curiosity
7. 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.

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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 practical ways to identify high potential employees

If you want a reliable strategy to pinpoint high potential within your ranks, implement these 5 operational habits:

1. Track analytical performance data

Use hard performance metrics (KPIs) to spot baseline standouts. Look for individuals who don't just meet their numbers, but show consistent innovation in how they achieve those results.

2. Test problem-solving in real time

An intelligent employee solves a problem once; a high-potential employee builds a permanent system or strategy to prevent that issue from ever happening again. Watch how employees approach structural problems.

3. Hold direct career alignment conversations

Talk openly with your team members about their long-term goals. Ask them candidly about their aspiration to take on senior management positions to see if their personal ambition aligns with your succession planning needs.

4. Evaluate emotional intelligence (EQ)

Observe how individuals handle workplace friction. High emotional intelligence—the ability to navigate interpersonal dynamics and stay calm under stress—is an absolute prerequisite for executive leadership.

5. Gather 360-degree feedback

Check in with an employee's peers, direct reports, and cross-functional partners. Peers often spot leadership traits, initiative, and everyday coaching qualities long before senior management notices them.

How to develop and retain high potential talent

Once you identify your high-potential employees, you must actively protect your investment. Keep them engaged using these developmental frameworks:

With Together’s mentoring software, pairing your high-potential talent with the right executive mentors is seamless, ensuring your future leaders get the exact support and network they need to drive your company forward.

See how Together can help you nurture your high potential employees—book a demo with one of our experts!