Finding HiPo: How to build talent internally

Businesses, from startups to multinationals, are shifting their focus from performance to potential as they try to create and nurture future leaders within the organization. In a time where technology, skill sets and roles can become obsolete in a year, corporates are realizing the importance of potential and focusing on competencies like learning agility, innovation and ability to operate in a volatile, uncertain, complex and ambiguous (VUCA) world. While performance reviews remain central, firms are developing high potential, or HiPo, programmes to best utilize the potential of their employees. “These programmes are needed as all high potentials are high performers, but not all high performers are high potentials," says Rajan Kalia, founder of Gurugram-based talent management and leadership consultancy firm Salto Dee Fe.

High potentials are identified through talent management, and the process is a culmination of performance review, assessment of individuals through a psychometric test, and management calibration of top performers.

“A typical high potential programme will include a combination of job experiences of cross-functional nature, officiating for higher jobs, management development programmes, coaching/mentoring. It may also include exposure to different geographical regions. The programme usually lasts 24-36 months," explains Garima Dhamija, founder partner at Salto Dee Fe.

The growth mindset

At Max Life Insurance, 40% of leadership positions are filled by internal staff. The company has a Best Bets programme that gives special attention to the need for investing in the organization’s talent.

“Potential and performance must go hand in hand for an employee’s success. However, the focus is higher on potential and we continuously strive to sharpen our potential assessment framework and validate it with the success of our internal mobility programmes. The aim is to build leadership capabilities and a talent pipeline to take up key positions in the organization," says Shailesh Singh, the company’s director and chief people officer.

A 2018 study by Salto Dee Fe that included interviews of 120 human resources (HR) leaders from across industries, found that high potential employees are 91 percent more valuable to an organization than other staff. An added benefit of such programmes is that they help retain top performers, says Rohit Hasteer, HR head of digital real estate startup PropTiger. “A high potential programme gives star employees the opportunity to grow personally and professionally. This is also our way to upskill and offer them exposure to world-class learning and opportunities that helps them to leverage their potential to the maximum," adds Hasteer.

These programmes are important for organizations that are growing aggressively, says Anshul Lodha, regional director of recruitment consultancy firm Michael Page India. “While the larger companies started developing these programmes a while ago, other players are seriously incorporating these of late, as a growing number of organizations are betting on younger employees based on their potential. These programmes are relevant as they allow a group of handpicked people to be closely mentored, trained at an early stage," says Lodha. “The two clear benefits of this approach is that it helps identify and acknowledge standout performers and helps the organization give these employees strategic projects that aids their development as well as helps retain them," he adds.

Defining high potential

There is a clear push among the majority (64% of organizations have a formal process in place to identify high potentials) of India Inc to create a high potential programme. Yet there is no one definition that firms or HR experts agree on. Salto Dee Fe’s research shows that 31% of the organizations have their own custom model for defining high potential and add to that models created by consultancies. “One thing common to most of these models is the fact that they take into account learning agility (the ability and willingness to learn and grow)," says Kalia. As far as models created internally by organizations go, they also take into account organizational values and culture fit.

At Max Life Insurance, the high potential programme is built on a foundation of meritocracy. “We have instituted the organizational talent review process, which is used for assessment and career planning of potential talent across the organization. As part of this process, each business manager identifies high potential talent in their respective functions who are identified as ‘best bets’ based on a combination of their current performance and future potential," explains Singh.

General intelligence, a kind of underlying brainpower, has up to 25% impact on employee’s performance, says Kalia. “This factor should be considered while designing any high potential definition, along with factors such as personality and culture fit." Contrary to popular belief that high potentials demand high wages, majority of them focus on knowledge and experience gathering by doing challenging assignments, and faster career progression to get exposure before filling the top spots, the Salto Dee Fe study found.

Leader driven

Most successful high potential programmes are found in organizations in which the leadership team is involved in developing them. Both at Max Life Insurance and PropTiger, the high potential programme takes a collective view from the top leadership.

“Best Bets is directly owned by the CEOs. Having their investment in the process lends not only a great degree of credibility, but also sustainability. We also follow the practice of line mangers being closest to the employee and hence promote their partnership in this journey," says Singh.

In PropTiger, different business heads are directly involved in the programme interventions. “Their involvement creates a buy-in among their teams and fosters great learning and growth opportunities for the high potential employees," says Hasteer. In their first international office in Dubai, nine out of 10 positions were filled from existing top performers.

Such investments of time and money both from the leadership and organization are imperative as they give businesses a competitive edge by having a continuous pipeline of talent, and also improve retention of future leaders and top performers.

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