Pooling for Potential: The Underrated Value of HiPo Identification
In the face of change and the current competitive talent market, how can high potential identification unleash untapped organizational value?
Organizations continue to grapple with rapidly changing business contexts and are more impacted by unplanned changes and volatility in their operating environments. There is more pressure than ever to respond with agility and have ready talent pipelines to drive and support organizational objectives.
In this blog post we will unpack why a healthy talent pipeline is critical, the importance of identifying high potentials in the broader organizational context and in alignment with an integrated talent management strategy, and how to adapt to changing contexts by mobilizing and deploying the right talent. When it comes to successful high potential programs, the keys to success are knowing what talent you have (against organizational requirements now and in the future) and how to make objective decisions to align talent to where it adds the most value.
Where does high potential identification fit in?
Talent management refers to the strategic process of managing the demand and supply of talent in response to the organizational strategy through prioritized practices and activities. When thinking about the organization’s future and emergent needs, the leadership pipeline or bench is often a prioritized talent pool, to ensure organizational sustainability. Criteria for identifying this talent pool is often progression along a leadership pipeline, as well as current performance and perceived competence.
High potential talent is another talent pool that holds great potential value, by identifying talent with the future potential that is required by the organization and purposefully aligning development opportunities to ensure talent is enabled and supported, to fulfill critical roles in the future. The value of high potential identification lies in its future orientation and defining a talent pool who are being developed and can be deployed into critical roles, within both leadership and specialist pipelines.
What do we mean by high potentials (HiPo)?
Although there is little debate that high potential identification can hold value for the organization, defining what “high potential” refers to is often a contentious issue. Having a clear definition within the organization goes beyond just semantics—if we can accurately define what we mean by high potential talent, we are likely to clarify why this is an important talent pool and how it can add value (measure impact), and how we identify this talent.
High potentials share attributes that predict their likelihood of success in the future. These are both current and future-looking attributes, which are proven to predict future performance. SHL’s high potential model highlights these attributes when defining high potentials:
- Ability: provides insight into the individual’s capacity to deal with the associated cognitive tasks or complexity of future roles. Ability in isolation is however not enough to accurately predict future potential, as it negates individual motivational factors. Having high levels of ability makes an individual 12 times as likely to be effective in a more senior role.
- Aspiration: refers to motivational factors that drive individuals to achieve their career goals. Understanding aspiration is critical to ensure that individuals have the energy and drive to apply their ability effectively. Individuals with high aspiration are 11 times as likely to achieve executive positions.
- Engagement: refers to the extent to which individuals are committed to the organization in the longer term. It provides insight into the likelihood of the individual applying their ability effectively within the organization. Highly engaged individuals are twice as likely to stay in the organization, put in extra effort, and meet performance expectations.
How do we get it right?
Given the importance of HiPo identification and the value that it adds, there are a few practical considerations that help us to get it right:
- Clearly define what potential means
We define potential as the ‘’sweet spot” where ability meets aspiration and engagement. Where all these attributes are aligned, individuals have the drive, ambition, aspiration, and ability for future potential. Once HiPo’s have been identified, organizations often struggle to take the next step, which is defining “potential for what?”. Taking the organizational context into account, defining potential should also answer two questions:
1. Do we have the talent we need now and in the future, i.e. are we strategically aligned?
2. Can we fill critical roles, i.e. do we have healthy pipelines and coverage?
- Using objective data to identify potential
Although performance data is a valuable metric to consider, our research suggests that performance alone cannot predict high potential, with only around 15% of high performers also likely to have high potential. By combining backward-looking data (performance, attainments, etc.) with forward-looking data (potential, preferences, motivation, and ability) you are able to objectively identify HiPo’s.
- Leverage a robust HiPo identification process to increase diversity in your pipeline
A common (unintended) consequence of HiPo programs which are based on subjective beliefs about potential, is the impact of bias in identification. Traditionally, we have seen that up to 73% of HiPo’s identified are done so primarily on a single subjective nomination. By utilizing robust and objective data and technology platforms, you can identify hidden gems that have potential but may have been overlooked or not considered for inclusion.
- Manage HiPo pools strategically and tactically
Once identified, insights into the HiPo talent pool can assist in aligning development programs to the overall gaps of the talent pool, to ensure readiness. It also provides a basis for robust career conversations and personal development planning, ensuring high potentials are recognized and engaged.
- Review and sense check in changing contexts
By utilizing a data-informed, robust identification approach, HiPo talent pools can easily be reviewed periodically to check for relevance, or to re-align as contexts or business challenges shift. This significantly reduces the time and effort spent on the identification process, to shift the focus to an agile response that supports business objectives.
High potential talent pools are underrated and largely under-utilized talent pools, despite their potential value add to organizations. Effective HiPo programs start with having a clear definition of what potential means in the organizational context, how to objectively identify high potentials, and proactively managing and deploying this talent to support the organization.
Talk to us to explore how we can support your organization in your journey!