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The Perils of Subjective Nominations of Potential in Succession Planning

Authored by: Managing Partners Roger Pearman and Robert Eichinger

We all find ourselves in another War for Talent. Most surveys report Top Executives are worried about having enough talent on the bench to fill near and long-term openings. Thousands of organizations periodically (mostly annually) have some form of talent review during which they attempt to identify high potentials.

We all acknowledge that the complexity and difficulty of flourishing in a global marketplace is continuing to get harder. The rate of change is building. The complexity of change is growing.  The speed of business is increasing. The digital revolution is changing everything. Competition is increasingly global. It takes more “talent” today to do the same senior-level job compared to decades ago and it will take even more going forward.  

There is and will be a never-ending need for people with the aspirations and talent to lead at the top, and each class of cohorts will have to be better than the class before.

Talent Management is a legitimate discipline. It has significant research behind the near consensus best practices. The Best Practices are mostly research-based, experience evolved and tested, with ROI documented. Winning the War for Talent is a known journey with alternate paths, and there are academics, practitioners, and consultants who specialize in the discipline of Talent Management. These individuals are ready to implement and execute all of the known Best Practices.

All that’s left is to do it!  But most organizations are not doing it well, or not doing enough of it well, to provide a competitive edge. Even those not doing it well know the Best Practices. Why the gap between knowing and doing?

All good and great things take time and effort. These are rare commodities for top executives.  Using a Best Practices process; following Best Practices protocols; engaging talented people engineers to facilitate talent management. Rare commodities indeed.

Best Practices Review

People who aspire to lead at the top of organizations–having what’s necessary and willing to do what it takes to get there and flourish–are plentiful.  But although many are called, few are good enough to make it. The current (and past and most likely future) supply of individuals with these rare capabilities is not enough to fill the opportunities.

Making it to and making it at the top requires a basic portfolio of knowledge, skills, abilities, and attributes and it takes organizations committed to developing future leaders. It takes two to tango to the top.  

There is near consensus on the basic arrows in the quiver of those with the capabilities to make it.  There are six clusters:
  1. Cognitive power.  It takes a minimum IQ or amount of intellectual horsepower to problem solve and do critical and analytical thinking at a level high enough to be competitive and win.  
  2. Motivation.  Because of the life balance sacrifices involved in a full-throated run for the top, you really have to want it.  
  3. Learning agility.  There is lot to learn.  There is a lot of ambiguity and uncertainty. Risky trial and error and correction. Changing to keep up with change. Global data bases. Few certain answers. Plenty of common challenges to solve and no rest until solutions are crafted. These require lifelong learning.  
  4. EQ. Most of the executive’s tasks involve influencing people up, down, sideways, and inside and outside the organization. Reading and responding to different people differently is the key mindset. The art of reading people is a bottom third skill for current top executives who are evaluated using 360 surveys. Treating and influencing different people differently is also a bottom third skill. There is a large EQ gap to fill.
  5. Pattern Mindset.  The best of the top have a systems mindset. They see patterns in information others do not see. They have a skill for essence detection. They see under the hood. They can find foundational causes others take longer to find or never see. They can explain how complex processes work. They have a block chain brain. Everything is connected.
  6. Brain Management.  Flourishing at the top includes managing well a lot of stress and frustration and tolerance. Demands on time and energy are high. Life/work balance is tested.  There are failures and disappointments, long hours and travel. Attention and focus are key. All of this takes emotional hygiene. Emotional management. Keeping the brain fit. Being able to bring everything to bear. Resilience. Grit. Resourcefulness. Self-management.

These six things plus all the behaviors that come with them equals what is commonly labeled potential. People who have more of these six things are thought to have the Potential to learn and grow over time and will be able to get to and flourish at the top.

There is substantial research and experience supporting the concept of Potential to Learn and Grow.  We have noted in our other writing that there are about 5% of the college graduate population who would be considered having enough Potential to get to and perform at the top.  5 of 100 graduates. The remaining 95 would make great employees and have material careers but are not good enough to get to the top. And there are non-college graduates with high potential as well.  

The opportunity to learn and grow has to be provided. Simply experience is the best teacher. The best practice is 70/20/10: 70% in challenging, expanding and broadening roles, jobs, and exposures, 20% learning from bosses, colleagues and others and 10% eLearning, courses, off-sites and personal learning. When we say experiences these are not just any experiences but specific experiences. Not just any learning from others, specific learnings. Not just any courses but specific courses. Again, we have outlined the specifics in other viewpoint articles and in TalentTelligent products.

Find them early. Attract them to internships. Give them opportunities to learn and grow from day one, and all the way to retirement. Assign them to developmental bosses. Get them totally engaged. Work diligently to retain them.  

All of these Best Practices require identifying those with Potential. Sourcing, attracting, acquiring, developing and retaining them over large chunks of time. We need to be able to evaluate the workforce and identify that small subset of people with high enough potential to get to the top and flourish.

The Weakest Link  

Aside from not holding today’s executives responsible for producing the leaders for tomorrow, there is another fundamental weak link in the process. Most talent review processes include nominations (mostly subjective) from bosses who believe they know who the high potentials are. Some organizations have highly informed and trained bosses who work hard to provide accurate nominations. Most bosses don’t get this right.

Asking for nominations is the fundamental flaw. Over the years talking to thousand of bosses involved in the annual talent reviews, most do not look forward to the process and are not comfortable making the nominations. And the studies suggest they are not very accurate.  There are false positives–people are nominated who turn out to be not good enough. And false negatives–people who have high potential but are not nominated. People who were qualified at one time but not anymore. Late bloomers who were not qualified before but are now.

There are five reasons for the inaccurate nominations:
  1. Most of the nominators are not high potentials. They are strong enough to have become bosses at several levels, but they are not among the top 5%. While little research speaks to this, we think it makes sense that the more you meet high potential descriptors, the better chances of identifying someone else who meets them.
  2. There is a values blockage. It is an elitist proposition that some people are better than other people and with growing social movements–DE&I and other Woke environments–this is hard for many to believe, much less support. Many believe anyone can be a High Potential if they really wanted to be one. Everyone is potentially a good manager or leader. As a result there are organizations which no longer use the term or the concept of High Potential. Regardless, it’s a thing and this thing makes up about 5% of the working world.
  3. There is a practical reason for a false negative. It’s talent hording: hard working bosses trying to keep the ship afloat have high potentials, but they do not want others to know, and they certainly don’t want others to take them away. If they nominate their likely High Potentials, the talent may be taken away from them for development. You nominate, you lose.  
  4. Most nominators will not be around when the nominated become legacy leaders. Most today have all the trouble they can handle with producing short term results. Investing time in a future in which they will not be present is a tall request. 
  5. Most nominators are not well informed. There is much research available on what exactly is a high potential. What do they look like, do and say?  How can you tell?  How would you know if you were interviewing one?  If one was on your team?  If someone else had one you also knew?

Help is on the way. All the research, studies and hands-on experience is getting us closer to a tight definition and a set of High Potential characteristics that can be observed and noted. We think it is time to turn more toward science.

There are about 5 worthy survey processes that purport to measure potential. We have one called KSAP (The Knowledge, Skills, Abilities and Attributes of People with Potential). There are four others. Research is being completed and reported. The processes all measure most of what potential means with satisfactory psychometric quality.

We don’t have to rely on subjective nominations. There is a test that produces a score. The results can be supported by boss viewpoints. Since this is one of the most important tasks a leader needs to complete to maintain momentum toward organizational success, let’s convert to science. 

Who are your vetted, validated and verified high potentials? Invest to find out.

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