Pitfalls of High-Potential Programs
Many organizations spend significant time and money creating programs to accelerate the performance of high-potential employees, yet HR leaders often have no idea whether their programs work. Too often, individual elements of hi-po programs are created in isolation from each other and HR leaders fail to lay out a blueprint for the way such programs will improve business results -- and how to measure the results.
By Brad Hall and Jim Williams
Several years ago we spoke to a woman who ran, arguably, the world's most well-known high-potential program. After learning the program details, we asked, "Does it work?"
"Of course it works! Google us," she said. "There are thousands of articles about our program. ... HR professionals from other companies come several times a month to benchmark us. And ... we had an event just last week and the participants loved it."
"But, why did you create the program?" we asked.
She said, emphatically, "To accelerate the performance of high-potentials."
"Oh, ... did it?"
She fumed, "How would I know that?!"
That may be the core problem with high-potential programs. We spend significant amounts of time and money, yet we don't know whether the program works. In fact, we're not precisely sure what it's supposed to do.
Building High-Potential Programs
Let's build a high-potential program using the same process we would to build an engine. First, we define the purpose of the engine. Will it be high mileage, high speed, or pull big loads? Second, we create measures that will tell us how the engine is performing to expectations. Third, we create a blueprint. The blueprint defines every required system and part and describes how all parts will work together.
All parts must be present. Having 99 percent of the parts, but no pistons, and an engine will produce nothing. Finally, we craft each part carefully to fit perfectly the other parts.
Unfortunately, when it comes to high-potential growth, we start with the parts -- isolated programs. Management development designs courses, talent management creates competency models and diversity initiatives increase awareness. But to what end? What, specifically, are we trying to achieve and what is the blueprint for getting there?
Define Success
HR leaders need to start with the question, "How will our high-potential program improve business results?" This needs to be more than a slogan; it needs to be a carefully considered plan.
Some HR departments define success by program quality: "We've adopted Company X's high-potential program." Others define success in general terms: "Accelerate the growth of high-potentials." But what does that mean and how will you know you've succeeded?
Once the basic premise is clear, define the target population. Most programs assume that substantial company tenure is required for top-leadership roles. That may be more valid for some functions than others. For example, in banking, relationship managers spend many years building internal and external relationships and social networks. Long tenure may be important.
Tenure may be less critical when appointing a controller or head of tax. Here is an example of defining success:
Objective:
To identify and rapidly develop high-potential talent in sales, marketing and operations.
Measures:
* Annual appraisal scores;
* Annual employee-engagement scores;
* Number of developmental milestones achieved versus plan at years three, five and seven; and
* Time between promotions versus norms.
Build the Blueprint
Once success is defined, the next question is: "What will be our system for producing the expected results?" Like an engine, all the parts must be present and all parts must be integrated. The system, not the parts, produces the result. There are three elements involved in improving the performance of high-potentials.
Selecting Candidates. The best training in the world won't make most of us into NBA players -- we just don't have the right DNA. In the NBA, and in many corporate roles, candidate selection is the most important step.
Selection starts by defining the profile of a high-potential. Morgan McCall of the University of Southern California has done excellent research on the high-potential competencies. He sees the following as predictors of executive potential: courageous, action-oriented, analytically agile, special talent with people, broadly respected and knows the business.
Others advocate slightly different competencies. But, the challenge for HR leaders is not getting "perfectly" defined competencies; the challenge is to build a process that will accurately assess high-potential competencies.
Royal Dutch Shell has a rigorous assessment process. The company uses assessment centers to assess personality traits, intellectual abilities (e.g., creative thinking) and business-case problem-solving. Don't let executives use gut-level assessments when choosing high-potentials.
Defining the High-potential Learning Path. The second element is the prescribed path for becoming a fully capable executive. Think of the way medical students become physicians. They go through a highly structured learning path of readings, lectures, labs, rotations, internships and residencies.
Assessments happen formally several times a semester, but less formally every day. There is no question whether med students are meeting developmental expectations.
An effective high-potential learning path is founded on the same principles. One path might be from finance manager to a CFO. First, determine what performance looks like when managers are ready for promotion to CFO.
Describe the quality of their business plans and execution, how they solve problems, make decisions and manage risk. How well do they develop their own people and how engaged is their team?
Design learning paths by in-depth interviews with people along the path to find out what was learned and in what sequence, how they learned it and how to assess it.
Set milestones along the path by describing typical performance at month one, six, 12 or more. Learning paths include target times for mastering each skill. High-potentials must know the performance expected at each milestone and precisely how that knowledge, skill and performance will be assessed.
Planning Developmental Experiences. The third element is program design and maintenance. A common mistake is to attempt to solve skill deficits with training.
For example, at IBM Japan, a new organization design changed the sales-executive role from revenue generator to general manager with a full P&L. The talent-management leader was asked to create general-management training to fill the skill gap.
However, in talking to the best general managers in Asia, a better solution was to change monthly reviews to focus on pricing, accounts receivable, etc. It worked. Get outside the training box.
Conclusion
It's time to flip the high-potential development model on its head. The new approach begins by defining success and how that will be measured. The next step is to build a prescriptive learning path with frequent assessments. Like med students, high-potentials must know that they either grow at the set rate or be dropped from the program. How and when growth is measured must be clear to all. Only after these steps should programs be designed. Success must be about great leaders, not great programs.
Brad Hall
is managing director of Human Capital Systems, a New York-based consulting firm. He is author of The New Human Capital Strategy and a monthly contributor to TheStreet.com's column, The Innovators.
Jim Williams
delivers learning processes that move more people to higher levels of performance, at least 30 percent faster. Based near Philadelphia, he authored the highly acclaimed book, Learning Paths (Pfeiffer and ASTD, 2004).
May 1, 2010 Copyright 2010© LRP Publications
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