How organizations assess and select high-potential talent is a source of unnecessary friction. Clear criteria and communication are key to developing a deep bench.
by Mike Prokopeak
March 22, 2012
As baseball’s spring training winds to a close this month, some promising young stars will earn a spot alongside veteran players on the opening day roster. Others will find themselves back in the minors.
Baseball managers have a pretty well-established set of statistical tools to decide who advances and who doesn’t. Statistics such as batting average, on-base percentage, earned run average and fielding percentage all provide a good picture of young stars’ potential for success. In corporate America, there’s not nearly as much consensus on how to select high-potential people for development.
According to a survey of more than 562 senior executives conducted by AMA Enterprise, an advisory services division of American Management Association, selection criteria varies widely.
“Some companies make tenure a precondition, but most do not,” said Sandi Edwards, senior vice president at AMA Enterprise. “Some restrict programs according to precise criteria, while at other organizations the criteria are vague, or at least not explicit.”
According to the AMA survey, 14 percent of organizations invite all employees to apply to participate in high potential development programs. Twenty-four percent make no announcement and depend on informal ways to inform their employees. At 41 percent of organizations, participation is limited by specific criteria, and more than one-fifth (21 percent) of executives surveyed don’t even know how participants are selected.
The question of who gets recognized as a high potential and who doesn’t isn’t academic. Prestigious and lucrative leadership positions are at stake, as is the future of the organization.
“There are some people in the organization you just can’t afford to lose,” Edwards said. “You need to know who they are. They need to know who they are and you need to be able to help them see their intrinsic value to the organization.”
The Critical C’s: Communication, Clarity and Criteria
The lack of communication and clarity about high potential assessment and selection is a roadblock for high potentials looking for recognition and opportunity. It’s also a source of friction among the employee population at large.
“They don’t know how to get into it; they don’t know what the criteria are; there’s not a real sense of transparency in the organization so that people understand that it’s not based on favoritism … but that it’s based on real, true skill sets [and] enablers for the growth of the organization,” Edwards said.
The more everyone in the organization understands how and why high potentials are selected, the better the program will be, she added. Those who are not selected will at least understand the criteria and skills they need to build to make the jump and see the process as more fair.
While communication and clear criteria for selection are universal, the actual parameters for selection should vary depending on the industry and the organization’s needs.
“Retail organizations are different from financial institutions or technology companies, and within each sector, growth and sustainability strategies may be quite different,” Edwards said. “So too may be each organization’s requirements for leadership.”
In general, Edwards said a solid high potential selection process should be based on a number of factors, including common tools such as performance appraisals, peer reviews and performance on stretch assignments such as project task forces. Senior management should also be integrally involved in talent review and assessment. Talent managers play a critical role in helping leaders develop a talent-targeting mindset.
“Every senior manager should be looking around to see who are the people that could possibly replace them or their peers, and it should be a part of the fabric of the organization,” Edwards said. That mindset should apply not just at the top level of the organization, but also throughout the middle to ensure a strong pipeline of managers to execute on business strategy, she added.
Don’t Be Content With the Status Quo
Defining selection criteria is important in another way. It helps the organization focus on future demands and the talent required to meet those needs. Without criteria, senior managers will tend to stay in their comfort zone, selecting candidates similar to themselves or who mirror people they’ve picked in the past.
“Sometimes they’re going to overlook people that have unique abilities that the future will demand,” Edwards said. “If you continue to just advocate and promote people that are just like the people before them, you’re going to get just what you’ve got. You’re not going to get the improvements and the innovation and the different perspective.”
The way that assessment and selection is conducted today casts a negative shadow over talent management in many organizations, she said. Only 12 percent of executives surveyed said their program is perceived as impartial and even-handed. Twenty-four percent said it is unfair and political and 27 percent think their program is well intentioned but flawed. “That certainly doesn’t bode well for morale and for people feeling good about the organization,” she said.
Refining the selection process can overcome that perception and provide a boost to both individual performance and organizational objectives in the process.
“With minimal resources and challenging economic times, you want to make wise investments in your human capital,” Edwards said. “Part of that is to know which part of your human capital can help you achieve what you’re trying to achieve.”
Mike Prokopeak is vice president and editorial director of Talent Management magazine. He can be contacted at mikep@talentmgt.com.
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