Retain Your Best Employees by Developing their Potential

We enjoy writing about human capital management technology and how to use it. However, today we are focused on principles and practices that need to be in place before the technology can benefit you. We are thinking about to keep your best employees.

How to retain top talent has been a hot topic for as long as we can remember. With the economy showing signs of recovery and concerns about the growing technical skills gap, it has surfaced again as the top concern of business leaders.

Many of the discussions use the terms “top talent” and “top performer” interchangeably, but the difference is important. Both need your attention, but different ways.

We use top talent to describe people with the potential to excel as leaders. They may not have the knowledge or experience to be high performers. They may not be competent yet, but they possess the ability to adapt to rapid change and to develop into larger roles.

Top performers are people who excel in the current role. They may or may not have potential for a larger or different role. They may lack one or more of the essential characteristics of high potential, or a negative attribute that will limit them.

Companies need to keep both – for different reasons and in different ways.

Culture and Purpose

The first need is a consuming purpose and a positive culture.

• A positive culture that values people recognizes and rewards achievement and doesn’t leave its wounded behind. It will have guiding principles that lead people to do the right thing.
• A purpose beyond next quarter’s financial results is one characteristics of high performing and high potential people is that they want to have a positive effect on other people. In a business enterprise, that means customers, communities, and each other. A positive purpose will foster and amplify that wish.

Roberta Matuson got our attention last fall in a Forbes article titled Why You Should Not Hire Top Talent. She described three top performers hired for their talent, then driven away by cultures that didn’t value or appreciate their contributions. Her point: if your culture doesn’t value and support talented top performers, you don’t deserve them.

Fostering Potential

We describe what defines top talent, but we need to be specific about what traits researchers identified as essential to executive leadership potential. Research by Claudio Fernandez Aroaz of Egon Zehnder with Boris Groysberg and Nitin Nohria of Harvard Business School gives us valuable information on how to identify potential, It also shows us how to grow talented leaders into executive leaders.

One results of their research is the Egon Zehnder model, “The Essentials of Executive Potential” It displays the characteristics as concentric rings to show the range from those most difficult to change to those easily learned.

The researchers describe five qualities that describe high potentials across the many organizations they studied.

• The first is the right motivation. It is the determination to achieve ambitious unselfish goals. They show deep person humility and are invested in being better at everything they do. Fernández-Aráoz et. al. describe this as a stable and unconscious quality which will not change.
• ”Curiosity: a penchant for seeking new experiences, knowledge, and candid feedback and an openness to learning and change.
• Insight: the ability to gather and make sense of information that suggests new possibilities.
• Engagement: a knack for using emotion and logic to communicate a persuasive vision and connect with people.
• Determination: the wherewithal to fight for difficult goals despite challenges and to handle adversity” (Fernández-Aráoz).

In addition, they recommend evaluating intelligence, values, and leadership abilities. You don’t need genius, but enough intelligence to meet your requirements. Values will include honesty, integrity, and a match with your organization’s core values.

Develop Potential

A cookie-cutter approach to developing potential will not produce the best results, and could do  great harm. Your development program must be aligned to your organizational strategy. The qualities and skills you develop will be unique to the company and the industry. Our experience with a national mortgage company and a global shipping company produced very different models.

There are, however, common characteristics your program needs:

Good communication. Many companies try to keep their high potential selections secret. Don’t bother – people talk. You need to communicate carefully. People will move in and out of the program, and you need to deal with managers not selected. More about this later.

Challenging assignments. If you don’t offer a challenge, someone else will. That doesn’t mean you need to overload them, and it doesn’t mean they don’t need a mentor readily available.

Rotation. Job rotation doesn’t mean a rigid series of assignments through every business function. It means the need to learn the business well, and need to deal with a wide range of challenges. Keep your strategy in mind.

Rewards. The rewards should be appropriate, but not excessive. If you find you need large rewards, it indicates something is amiss.

Flexibility. Your program will change, and people will move in and out of it. In a meeting about ten years ago, Jack Welch described the six-year program to develop replacements for him and other top executives at GE. Jack explained that they grouped their top contenders into an “A” group, then created another “B” group who did not meet the criteria of the A group. At the end of the program, none of the A group survived the program, but several of the B group did.

Foster High Performers

Part of the inevitable fallout of naming high potential talent is the conversations with high performing people not selected for the program. The best approach is honest communication. If you use an assessment and review the results with the employee, it can be constructive conversation.

We know many people grateful for the conversation. It relieved them of the dread of failure in a more responsible position and enabled them to readjust their expectations. We are reminded of a Firefighter Engineer in a medium-size city who took an exam to become a Lieutenant. He told us he wouldn’t be disappointed if he didn’t pass, saying with a big smile, “If I don’t make it, I get to keep driving a fire truck for a living.”

Top performers become complacent and restless if left in a role that no longer challenges them. The best solution may be a progression for individual contributors who become senior contributors and act as gurus for people in their field. Another may be to give them a challenge in a different role. We all know of top performers promoted into leadership roles they couldn’t handle. Lawrence Peter lives on.

One More Thought

If you are ready to start changing your culture, would it be helpful to have high potential leaders to help you take on the challenge?

References

Fernández-Aráoz, Claudio. "21st-Century Talent Spotting." Harvard Business Review. June 01, 2014. Accessed February 24, 2016.

Fernández-Aráoz, Claudio, Boris Groysberg, and Nitin Nohria. "How to Hang On to Your High Potentials." Harvard Business Review. October 01, 2011.

PhenomeCloud is a comprehensive technology solutions provider committed to empowering businesses to overcome challenges, enhance their workforce capabilities, and achieve superior outcomes.