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Jul 18, 2014

Organizations the world over are investing big sums in high-potential employee (HiPo) development programs because they rightly see that developing their employees is the best and most efficient way to find their firm’s future leaders.

And the rewards can be great: CEB research shows that organizations with strong leadership can double their revenue and profit growth.

But all this investment is for naught if a firm’s brightest and best take all their “world class” training and hot foot it off to a competitor. SHL Talent Management research shows that a staggering 55 percent drop out of HiPo programs.

Given the career risk to an HR executive in telling their CEO that half the top talent in the company is likely to leave within five years, they should not only focus on those development programs but on engaging and retaining HiPos.

HiPo engagement

That HiPos are hard to hold onto shouldn’t really surprise anyone, because they are in huge demand. If one firm wants them, then so do their competitors. And they are rare. Only one-in-seven high performers are considered “high potential;” i.e., that they are likely to reach a senior position.

So for those few, it’s a seller’s market. They’re will look carefully at their experience with their existing company and weigh it against career prospects elsewhere.

SHL Talent Management research shows that whether they go or stay depends on their engagement with the firm. It’s one of three essential components (with aspiration and ability) that helps managers understand which of their employees is likely to rise to a senior position, perform well in the role, and stay with the firm long enough to justify the investment.

Before allocating a place on a HiPo program it’s important to understand whether the employee is committed to the organization and sees it as the best place to realize their career goals.

The anatomy of engagement

As our data and research show, engagement can be measured and has two components: ”current engagement” and “future engagement.”

Current engagement is determined by a combination of past experiences with an employer, and an employee’s current experiences in their job, role and work environment.

Future engagement is determined by an employee’s expectations about their job, career and their employer, or what we call “engagement capital.”

Engagement levels, both for now and the future, will depend on an individual’s rational and emotional commitment to their employer. They are going to be as interested in their alignment with the organization’s mission and goals as they are with their personal challenges and goals.

How to keep HiPos engaged

Almost 60 percent of HiPo employees with high engagement have a high intent to stay; more than double that of HiPos with lower levels of engagement. To keep HiPos engaged, managers should take three steps.

  1. Show them some love. Make sure they know they’re important to you, as that helps build commitment. Amazingly, 63 percent of organizations don’t even tell their HiPos that they are high potential.
  2. Give them a challenge. Give them highly visible and challenging stretch roles. Our research shows that 70 percent will stay if they get a challenging task and unconditional support.
  3. Make them commit. In return for your firm’s investment in them, consider asking your HiPos to commit to your organization for a period. A surprising 89 percent of organizations ask for no such commitment.

Taken together, these steps can improve the success a high potential development program by a factor of 11.

This was originally published on the CEB blog.