IDENTIFYING AND MANAGING HIGH POTENTIAL EMPLOYEES Robert Hogan, PhD (with Tomas Chamorro-Premuzic) Hogan Assessment Systems

Agenda Who are the “high potential” employees? Do they matter? Can we identify them? How do we motivate them?

HiPo Hype…

HiPo Hype… “A strategic focus on employee potential is the single thing an organization can do to maximize current and future performance.” Corporate Board

But nothing new Assessment psychology always focused on high potential High potential (probability) that behavior x occurs in the future Any psychological construct (talent, motivation, creativity) predicts future behavior and critical incidents But this is news to HR

Vilfredo Pareto (1848-1923) 20% of the workforce = 80% of the productivity. 80% of the workforce = 20% of the productivity. HiPo’s the rest

Defining HiPo’s To define HiPo’s, we must distinguish between perceptions & real attributes…

(Mis)Perceptions of HiPo’s “The top performers of today” Mmmm…. only 30% of those are real HiPo’s and just 20% with “people skills” 90% don’t perform well at next level

(Mis)Perceptions of HiPo’s Bad news: Every company has a HiPo model Good news: They are all the same

The DNA of HiPo’s… Rewarding Smart Productive Leader-like Entrepreneurial warm trustworthy predictable curious adaptable fast learner hardworking energetic high standards ambitious resilient good judgment creative opportunistic visionary Note: Cultural variability explains more emphasis on some than others

The DNA of HiPo’s… Rewarding Smart Productive Leader-like Entrepreneurial warm trustworthy predictable curious adaptable fast learner hardworking energetic high standards ambitious resilient good judgment creative opportunistic visionary Sensitivity Adjustment Sociability Inquisitive Learning approach Ambition Prudence Adjustment (-) Ambition Sociability Sensitivity Inquisitive Prudence (-) Sociability Excitable (-) Bold (-) Reserved (-) Imaginative Skeptical Dutiful Diligent (-) Bold Mischievous Colorful Bold Inquisitive Prudence (-) Sociability Affiliation Altruism Hedonism Science Aesthetics Recognition Security Commerce Power Recognition Commerce Tradition (-) Aesthetics Security (-)

Global Norms The DNA of HiPo’s is more or less global Small difference: Asians more intense, creative (entrepreneurial) and fun than English speaking Western samples

Bright Side Global Norms

Dark Side Global Norms

Core Values Global Norms

Politics Distort High Potential Identification Performance appraisals are influenced by office politics (surprise, surprise…) HiPo nominations don’t predict performance Valid tests do

Consequences of poor HiPo identification Failing to identify true HiPo’s causes them to leave for a competitor Identifying “fake” HiPo’s alienates coworkers (especially true HiPo’s)

Managing and Developing High Potentials Engagement key to retaining HiPo’s Good leadership creates engagement (but it is rare)

The Contexts of Leadership Leadership is more important in certain contexts than others — sometimes people need to be left alone. Consider the next slide—which shows that engagement is the key to retaining HIPOs.

CONDITIONAL LEADERSHIP MATRIX

Engagement as personality Some people engage more than others. But calling engagement a trait makes it an employee problem (letting management off the hook) Engagement is a management problem.

Engagement as a State Energy and persistence Positive affect and involvement Enthusiasm and pride A sense of empowerment Finding meaning/a sense of purpose Adapted from: Schaufeli, W. B., Salanova, M., Gonzalez-Roma, V., & Bakker, A. B. (2002). The measurement of engagement and burnout: A confirmative analytic approach. Journal of Happiness Studies, 3, 71-92.

Engagement ad psychological state A relatively persistent psychological state associated with behaviors beneficial to an organization Employee engagement is a function of how people are treated by management

Why should we care about Engagement? It’s the “g” factor in organizational life. It’s predicts every important business outcome (good & bad) It predicts individual and unit outcomes: absenteeism, turnover, productivity, and ratings of customer satisfaction.

Leadership  Engagement  Performance Managerial behavior drives employee engagement. Employee engagement drives business results. Good managers are good for business. Bad managers are bad for business.

Leadership  Engagement  Performance

Where does disengagement come from? boss or supervisor (most frequently cited) no control over work bad decisions by upper management (see 1) poor teamwork the company (see 1) office politics (see 1) no accountability

Hogan Leadership Value Chain “When organizations hire and promote bad managers, they alienate employees and undermine their own financial interests.” Robert Hogan 28

Good leadership fosters engagement Effective leaders: Act with integrity Treat people with respect Communicate effectively Make good decisions Take responsibility for their mistakes Establish standards and a vision Personality predicts effective leadership

Hogan Leadership Value Chain 30

(Mis)managing Engagement 47% of executives think they create engagement 57% of middle managers think long-serving supervisors cause low engagement 84% of respondents think disengaged employees are one of the biggest threats to their business 12% report that their company tries to deal with engagement!!

Engagement & HiPos (a) retention of HiPos is crucial (b) engagement is crucial for retaining HiPos HiPo’s could go anywhere else “To take engagement seriously requires a radical rethink of how managers treat their staff.” Robert Hogan A 2005 report by the Corporate Leadership Council shows that…

Creating a HiPo Culture: 5 rules Use validated methods to identify HIPOs. Don’t rely on current performance. Evaluate the colleagues of your HiPo’s Evaluate the managers of your HiPo’s. Senior leadership must support HiPo engagement.

In conclusion HiPo identification requires valid empirical tools (it is NOT intuitive) HiPo management – especially motivation and retention – requires engagement Engagement is a function of leadership

In conclusion Personality is key to identifying Hi-Po’s, and those who can identify and manage Hi-Po’s

Thank you robert@hoganassessments.com