Cindy, the CEO of a rapidly expanding global software organization, needed to aggressively identify and develop her next generation of leaders. The organization had succession planning programs in place, but couldn’t develop leaders quickly enough to keep pace with their growth.
The chief human resource officer (CHRO) suggested transparency, telling high potentials the company was making substantial investments to help elevate their careers. The CHRO believed transparency would solidify commitment and boost motivation among top talent, and eliminate prospects that weren’t the right fit. Cindy discussed this with her leadership team and was surprised at the leaders’ strong—and divided—reactions.
The team made key points about the positives of transparency:
- Securing increased commitment. By telling high potentials they have promising futures within the company, they’ll be more invested in its success.
- Boosting retention, motivation and commitment among the ‘chosen’ employees. Knowing they’re poised to elevate within the company means they’ll stay loyal to the organization and work hard to succeed there.
- Determining who will (and won’t) be a good long-term fit. Some leaders tell high performers their status, weeding out those without the maturity to handle that candor. If employees become overconfident or obnoxious after learning they’re high potential, it can lead to their demise, leaving room for other talented prospects to advance instead.
They also argued the negatives:
- Your plan could backfire. Telling select employees they’re poised for greatness may create unbearable employees who believe in their own superiority. They may coast on their previous merits, believing that since they’ve already sealed the deal, they don’t need to work as hard to succeed.
- The power of the grapevine. Word spreads quickly, so if you’re telling 10% of the workforce they’re high potentials, the other 90% will quickly figure out they aren’t. This can cause major friction between the haves and the have nots, and much of your team could become disillusioned, unmotivated and unproductive.
- They overcompensate. Some high potentials want to show they can handle additional responsibilities, but may take on too much too soon. By taking on more than they’re equipped to handle, they risk failure.
To determine whether to be transparent, consider these points:
- Commit to coaching top talent. Make talent development a high priority, providing high performers with increased training, responsibilities, mentoring and, ultimately, advancement. Developing strong performers is far more valuable than simply telling them they’re high potential.
- Consider the whole package. Don’t assume employees are high potential because they perform well. Each employee’s “soft skills”—personality traits, reputation, integrity, etc.—should factor into your decision.
- Be specific. ‘High potential’ is a vague term that can be open to interpretation. Be clear about expectations and benchmarks/timelines for advancement.
- Recognize and reward great work. Regardless of whether you tell employees they’re high potential, acknowledge strong performance and reward hard work with praise, raises and advancement. By doing so, you demonstrate employees’ value, increasing their motivation and commitment.
- Decide whether you can afford to gamble. Will transparency keep high potentials loyal and prevent them from deflecting to competitors? Or will it backfire, eroding your corporate culture? Determine whether the rewards of telling outweigh the possible risks.
Every company has high-potential and low-potential employees. Finding the best staff members and cultivating them is critical to any company’s long-term success. When it comes to telling them vs. not telling them, you must weigh the benefits and drawbacks and decide what is right for the long-term growth of your firm.