Finding the BEST

Eric Beaudan and Philippe Cavat on how to identify your organisation’s best high potential talent – and what to do with it

In the 1970s and 1980s, US television channels would start their nightly newscast by asking the ominous question: It’s 10pm, do you know where your children are? In today’s world, business and HR leaders might start their strategic review sessions with a similar phrase: It’s 2018, do you know where your high-potential leaders are? If you can’t answer that question, and can’t back it up with quantifiable data, the odds are against you in the battle to attract and retain talent.

High-potentials typically make up only five to 10 per cent of an organisation’s employee population. They are often defined as leaders who can step up one or two levels within 18 to 24 months, or sometimes as individuals who can quickly switch from one leadership role to another in a different function and quickly add value. As McKinsey found in a recent study of 600 organisations, these “fast talent reallocators were 2.2 times more likely to outperform their competitors on Total Shareholder Return (TSR) than were slow talent reallocators.”1

So how do you identify high-potential individuals, and what are the qualities that these individuals display early in their career? With millennials slated to make up threequarters of the global workforce by the year 2025, being able to spot these characteristics and encourage their development will be key to any organisation’s success. Yet an Oracle white paper found that “only 20 per cent of our respondents report being Very Satisfied or Satisfied with the ability of their organisation to track metrics associated with their HiPos, including where they are sourced”.2

Given this dilemma, we’ve gathered some best practices and lessons learned from the dozens of organisations where our Leadership Practice has been assessing leaders globally to find those rare nuggets. Here are some takeaways:

Cast a wide net: Clients often ask us if they should only assess employees who are seen as high-potential by their business leaders, and invariably the answer is no. People who are labelled as high potentials without a formal assessment are either simply high performers in their individual role, or people who stand out from a very short talent field. In many cases, pressured business leaders nominate people who would never be selected on a high-potential list through an objective assessment process.

Look for future leadership potential and motivation, not past performance: Performance ratings are situational and limited to a certain time period, with lots of external contributing factors. To properly assess potential, you need to look deeper and determine what an individual’s passion and inner leadership talent truly looks like. It is striking how often, once you identify and redeploy a high-potential employee, you multiply that individual’s contribution to the organisation.

Recognise diversity: Not all strong performers are alike, and likewise not all high-potentials are alike. Some high potentials will thrive when presented with opportunities to deepen their expertise in their field. Others would rather sample multiple experiences and learn about different parts of the business. Not all will follow identical career paths.

Provide guidance and feedback: There is a general misconception that high potentials are self-guided rockets that can naturally achieve their goals, when in fact many are still in the early stage of their leadership development. Structured development and coaching are thus required to help ensure that the individual doesn’t burn out during his or her ascent.

One final thought: the debate over whether or not to disclose high-potential status to employees is largely over. Harvard Business Review authors Douglas Ready and Jay Conger reported that “the percentage of companies that inform high-potentials of their status has risen from 70 per cent about a decade ago to 85 per cent today”.3 Letting high-potentials know that the organisation values them and is willing to invest in their development is a good indicator of how robust your ability to spot high-potential talent really is. This in turn creates a powerful plank in your talent strategy that benefits the entire organisation.

1 ‘Linking Talent to Value’, McKinsey Quarterly, April 2018

2 ‘Managing High Potential Employees: Managers Can Make the Difference’, Oracle Human Capital White Paper, 2017

3 ‘Are You a High Potential’, by Dougals Ready and Jay Conger, Harvard Business Review, June 2010.

Eric Beaudan is the Global Head of Odgers Berndtson’s Leadership Practice, based in Toronto. Philippe Cavat, based in Paris, heads up Odgers Berndtson’s Leadership Practice in France.