Using High Potential Programs to Develop Successors

Organizations have long used high potential programs to develop successors. However, recent research shows that these programs haven’t always come with a significant return on investment.

In fact, according to a 2013 high potential program study by The Corporate Executive Board Co., despite increased investments in high potential programs, most human resources professionals lack confidence in them, with about half reporting that they’re either dissatisfied or highly dissatisfied with their programs.

Given the fierce competition for talent and the need to grow a strong bench of successors, high potential programs will remain an important strategy in employee development. What organizations need to do is understand how they can improve the success of these programs to build a stronger leadership bench.

First, define “potential” correctly. Many organizations confuse current performance with future potential. However, longitudinal benchmarks reveal that roughly 30 percent of today’s high performers are successful when promoted two levels up. Those organizations that have successful high potential programs recognize that employees need more than strong performance in their current role to succeed in future ones. They also need to have the aspiration to rise to a more senior role, the ability to manage and lead effectively in these new roles, and engagement levels that show high commitment to the organization.

Without measuring each of these — ability, aspiration and engagement — organizations will be wrong more often than not in deciding who to bet on for the future.Next, measure potential objectively. Organizations in the U.S. have spent several billion dollars on high potential programs since 2012, according to CEB research. Yet, surprisingly, nearly half of them lack a methodical process for identifying and developing high potentials, and only a third of organizations use assessment data to identify candidates.

Manager assessments alone are subjective and may not be accurate enough to determine employees’ ability, aspiration and engagement. To ensure fair and valid identification of high potentials, organizations should adopt objective assessment tools and evaluation methods.

Then, create differentiated development experiences. The typical high potential program fails to prepare participants for roles they may hold in the future. Providing high potentials with targeted projects and stretch assignments helps them learn new skills. It also builds their ability to apply existing skills to different roles within the organization.

Finally, ask for commitment in return for career opportunities. High-potential employees are strong performers and are highly marketable, thus they are often confident in their ability to find work elsewhere. Yet, CEB research shows that only 11 percent of companies require formal commitment from their top performers.