opened manilla folderMember-based advisory company CEB has stated that over two-thirds of companies fail to identify their employees with the most potential, which threatens long-term performance goals. Failure to retain high-potential (HiPo) employees drives these future leaders to competing organizations who will invest in their development. In order to keep top talent, companies must re-evaluate their retention programs and boost spending to maximize bottom-line results.

According to CEB’s “Improving the Odds of Success for High-Potential Programs,” major corporations spend an average of $3 million per year on leadership and development programs for high performance employees but still lose 55 percent of these employees within five years. This high level of turnover wastes the money spent on retention efforts and drains organizations of their leadership bench strength. Weak leadership generates about half of the revenue and profit growth of organizations with strong leadership.

“There is mounting pressure on companies to realize the value of any talent investment made, especially Hi(gh)Po(tential) programs which deliver future leaders for the business. Too often resources, training and career opportunities are directed at employees who lack the aspiration, engagement or ability to be effective at the next level. This misidentification is preventing those with the strongest potential from reaching senior roles and could restrict an organization’s future productivity, innovation and performance,” said Eugene Burke, chief science and analytics officer at CEB.

Insights from the research indicate a four-pronged approach to improve the caliber of an organization’s leadership:

• Develop a clearer definition of the key attributes required by employees to rise to senior roles.

• Adopt a systematic process for identifying high-potential talent through objective talent assessments.

• Offer career opportunities in return for long-term commitments from employees.

• Help HiPo’s learn new skills but also apply their existing skill sets in different roles through high-impact development experiences.


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