How Organizations Fail High-Potential Talent

August 17, 2023
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It’s a wonderful feeling when a home-grown high-potential executive moves upward and takes their rightful place in the C-suite. Everyone celebrates the selection and sits back to watch the magic. At least, that is how it’s supposed to be. But what happens when the individual with so much promise can’t deliver after the big day arrives?

It always comes as a shock when someone with an impressive combination of talent, experience, and results fails to achieve success in a new role. What causes a high-potential or ready-to-scale executive (a HiPo) to crash and burn when scaling to the next level? Failure can usually be traced to one of two causes—an unaddressed shortcoming in the individual or a failure at the organizational level.

Below I’ve outlined the danger points within the organization that can result in failure as well as preventive measures or corrective steps that organizations can take to ensure their HiPos are well prepared and supported.

Failure to Consider Strategic Goals
The foundation of a successful talent-management program should begin with a clear picture of the organization’s strategic goals. What does the company need to accomplish over the next three to five years? How will it be done? What dangers lurk over the horizon? What kinds of people will the company need to be successful given these challenges and opportunities? Without this grounding in the direction of the business, organizations are at risk of filling critical ranks with leaders who have impressive skillsets but cannot execute the strategic vision.

An evaluation of strategic goals should inform organizational leaders about the abilities and behaviors required of future leadership. Once consensus has been reached around the characteristics needed to sustain future organizational success, they should be codified and publicized. Executives who are ready to scale should then be assessed and developed with these qualities in mind.

(Mis)Identification
Organizations often overlook or fail to identify those who are ready to scale. The most common causes are:

  • An abundance of subjectivity in talent reviews
  • Lack of a consistent process to accurately assess capability
  • Equating future potential with current performance

 

While exceptional results may be a requirement for being deemed a HiPo, outstanding performance in and of itself does not guarantee success at the next level. Proper identification of potential starts with an accurate and targeted assessment of leaders. Programs that are successful at identifying high-potentials include a vigorous focus on future success that is independent of past performance.

The organization’s hit rate can be further enhanced by leveraging objective executive assessments. Once an assessment is completed, talent review roundtables—where managers meet and seek alignment on high-potential leaders in the organization—can mitigate the misidentification of those with readiness to scale, so long as they are carried out objectively and with multiple diverse perspectives in the room.

Many talent processes perpetuate bias and hamper the extent to which leadership can become more diverse, and the individuals involved in identifying those ready to scale need to be mindful of this. Improving diversity in the leadership pipeline requires talent processes that enable managers to have healthy conversations with the right boundaries and structure in place. Bringing curiosity, courage, and objectivity to talent conversations to drive better decisions was the topic of our recent webinar on this topic. You can read more here.

Failure to Develop and Retain High-Potential Talent
A good identification process means little if the organization falls short on talent development and retention. Development of HiPos accelerates their readiness and prepares them to move more quickly through the pipeline. Stretch assignments, external coaching, mentoring, and learning opportunities are all key elements of the development and engagement of high-potential talent.

A primary goal of all these experiences should be increasing the executive’s self-awareness. Leaders who gain a deep understanding of their strengths and weaknesses early in their career are better able to leverage their assets and more consistently show an ability to mitigate and compensate for their derailers.

In addition to the bottom-line benefit that is derived from more effective leaders, development also plays a critical role in the retention of HiPos. Investment in their growth signals to them that they are valued by the business and allows them to envision a future there. This is particularly important since executives advancing through the ranks are particularly attractive to outsiders.

Lack of Support During Transition
Transitions are where the rubber meets the road and will test how well the organization has identified and developed its high-potential talent. Transitions can also be stumbling blocks. One of the biggest mistakes organizations make is thinking that selecting or promoting the right person is the last thing they need to do; it is really only the beginning. Providing the right kind of support to a new leader can mean the difference between success and failure.

To increase the likelihood of success, businesses should plan the transition as far in advance as possible. When a transition or promotion is imminent, a clear roadmap will mitigate the risk of early missteps and accelerate success in role. Research by RHR International shows that full integration can take as long as 18 months. Support is needed throughout this time frame. Transition can be supported through internal mentoring, external coaching, and periodic feedback that enables timely course corrections.

The Bottom Line
To ensure the success of your ready-to-scale executives:

  • Evaluate current and future strategic goals for clues on future leadership requirements
  • Assess candidates to identify gaps and predict performance in a given role
  • Use assessment insights to identify HiPos
  • Support HiPos with development programs before appointment and integration after
  • Continue development and support even after promotion

 

By addressing any issues early on, the organization can strengthen the development process and keep prepared and capable executives flowing upward through the leadership pipeline.

At RHR International, we’ve supported thousands of leaders on their journey to the top. To find out more about our executive assessments, visit our website here.

Matt Betts
Matt Betts is responsible for both the technical and creative sides of data analytics, producing insights that are easily accessible to clients and creating innovative, data-forward solutions to help clients make sound talent and business decisions.
stephen-johnston
Stephen Johnston is a Consultant on the Executive Bench team. He is well-known for his expertise in developing talented leaders and also for his dedication, having spent his career, and his life, devoted to others.