TM - August 2007 - (Page 39) attributes, these individuals can be difficult to find, so retaining them needs to be a primary concern. Retention in Today’s Environment that same study, 57 percent of the firms interviewed saw an improvement in productivity. Identifying high-potential employees can open the door to frank, productive discussions about the areas in which they need to grow. Such feedback now can be given in a more concrete context for assessment and development, which will likely foster their development. Naming high potentials (and making the criteria for selection public) also gives other employees a tangible goal to achieve highpotential-employee status. It also empowers individuals to take charge of their own development and careers. Step 2: Develop an Innovative Development Program The do-more-with-less approach to business that prevails today makes high-potential employees a vital component of an organization’s success. According to a recent survey conducted by executive coaching organization Marshall Goldsmith Partners, the typical difference in contribution between a top performer and a below-average performer at the same pay-grade level is more than 100 percent. This vast difference in performance levels certainly could leave gaping holes within an organization if too many high-potential employees are lost. Most companies are experiencing difficulty hiring qualified candidates, and the mass exodus of retiring baby boomers over the next several years will compound the situation. These phenomena require companies to cultivate existing talent and expedite the development of high-potential employees. Just as a speed-to-market product strategy can generate a competitive advantage, effectively developing current and future leaders can produce a comparable competitive advantage — assuming you can keep them. Step 1: Tell Them They are HighPotential Employees As with other training and development programs, tying the objectives of a high-potentials program to the company’s business strategy is key to make sure it will meet the organization’s needs. To ensure alignment, it is critical to set a proper foundation for the program. This typically includes: • Identifying selection criteria for high-potential employees. • Testing the criteria with key business leaders for validity. • Developing a communication strategy. • Creating a process to evaluate effectiveness and facilitate continuous improvement. Once the foundation is in place, focus on how to make the high-potentials program an effective means to attract, retain and motivate top employees. A successful program typically integrates a development strategy (that builds core competencies) and an organizational strategy (that enables high performers to do their best work). Key elements of a development strategy include: • Company communications that create a link between a high-potential employee’s contributions and the company’s success. • Performance plans and assessments that support the achievement of stretch goals. • Mentoring or coaching that allows high-potential employees to learn from select employees or experts. • Lateral assignments or projects that transfer learning in the workplace. • Stretch or overseas assignments that challenge and provide a catalyst for growth. • Formal training through external or internal programs. An organizational strategy should include: • Performance-based compensation. Organizations that base their compensation on seniority versus August 2007 It’s the oldest question in succession planning: Should you tell employees they have been identified as high potentials? Answers are decidedly mixed. A benchmarking study by the Center for Organizational Research revealed 54 percent of participating companies do not tell employees they have been labeled as high potentials. Reasons for not telling often include setting expectations they cannot keep, using a high-potential status as a bargaining chip or kicking back on the current job now that a promotion is in sight. We live in a society that identifies and develops high-potential talent, so why shy away from that in business? Children with above-average abilities in sports, academics or the arts enter programs to obtain the guidance they need to develop their skills in the hopes of achieving excellence. Life in the office should be no different — high-potential employees should be identified early and then developed, challenged and recognized for their achievements. Many successful companies find great value in letting their employees know where they stand. There can be valid reasons for not telling employees they’ve been identified as high potentials, but the overall benefits of revealing this outweigh the risks — just telling candidates can be an effective retention strategy in itself. According to a study of 225 corporations across 10 major industries, 69 percent of companies experienced improved retention once high-potential employees learned of their status. In talent management magazine www.TalentMgt.com 39 http://www.TalentMgt.com
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