Potential Isn't Everything ?

I have always been tempted to understand the euphoria regarding potential assessment in organisation. So to make this clear, we dissect the essence of Talent strategy & management and unplug this mystery ...

 

One of the biggest overarching mistakes we see People managers and their organizations make is confusing performance, potential and readiness. It’s important to understand that each has a distinct definition:

·         Performance is how one is performing now in his or her current role.

·         Potential is one’s likelihood of leadership growth.

·         Readiness is one’s fit with a specific role, job, or job family.

 

Confusing these three concepts can lead to disastrous decisions about talent. Those who perform effectively in one job won’t necessarily succeed in a job at the next level. Those with potential need to be developed. And even those who have been identified as having potential and have benefited from development may still not be ready to take on a challenging role or job.

Let us look at this from an Olympic gymnastics coach perspective on what it takes to spot potential in young gymnasts. She looks for traits such as attitude and mental toughness in girls who are still years away from competing at the highest levels. Similarly, in business, when looking to identify those with leadership potential, it’s not current performance that matters (though current performance must be the starting point for identifying potential) as much as what sort of leader an individual is capable of growing into in the future.

Unfortunately, just 34 percent of companies feel that they are effective at identifying those with potential to lead early in their careers, yet those that do perform better. Common mistakes include:

·          Focusing on current performance alone

·          Inconsistent criteria

·          Unchallenged perspectives and opinions

·          “Promote your own” strategies

·          Singular focus on strengths (no consideration of leadership  derailers)

·           Identification without subsequent diagnosis of development  needs

Taking into account the critical differences between potential, performance and readiness, it’s our job to make sure the organization is doing an effective job of identifying those with the most leadership potential. Because resources (i.e.time, money, development opportunities) are always in finite supply, we have to be diligent about investing those resources in that small segment of our organization’s leaders—typically no more than 10 percent of the leader population that represents the greatest future payoff for the organization.

There are two different reasons to assess leaders:

1)      For potential and

2)      For readiness (performance is best ascertained by gathering performance feedback)

 When an individual is assessed for potential- the assessment will look at a number of factors, including: learning agility, drive and commitment, critical thinking, risk taking, perseverance, interpersonal savvy, receptivity to feedback, and propensity to lead. If individuals display these factors, there is a better chance they will succeed as they move up the leadership ladder.

 

Assessment of readiness- on the other hand, is done against the Success Profile for a specific role (e.g CFO, VP Marketing). This assessment provides a prediction or signal that someone is capable of moving into a specific role or position and succeeding.

 There is tremendous value in each of these assessments, as they both provide the objective data needed to understand current talent capability and gaps. This is why many highly effective organizations use both- using assessment for potential to focus on growth and assessment for readiness to inform promotion and placement decisions.

 

Plus, it’s far more effective than relying on being able to “spot” those who are ready for key jobs right now or those who can be developed to step into those jobs in the future.

 

So the interesting question is"Are we hyping the Potential Assessment too much"?

 

Sd/-

Roohul Haq