What You're Doing Wrong with Your HIPOs

Tammy Heermann Article

In recent years the creation of high potential development programs has grown at an accelerated rate.

Studies have proven that HIPOs are up to 2 times more valuable than the rest of the employee population and they drive multiple times their compensation in business. Clinging to this promise, organizations are investing budgets into programs that will secure leaders needed for the future. Despite this healthy investment, organizations are not happy with the ROI these programs generate, nor the rate of acceleration of their HIPO pool. What’s happening here? Why can’t organizations seem to capitalize on this captive audience that is desperate to grow? 

There are a few common scenarios I see in nearly every organization that are shaping their HIPO strategy. Below I describe three. Do any of these scenarios sound familiar to you?

“Wow, we thought we had chosen great individuals, but when we got them together as a group the caliber of talent was so variable. We even wondered how some individuals got selected in the first place. It ended up creating a subpar experience for everyone.”

This is probably the most common scenario I see in organizations – defining the HIPO talent pool incorrectly. What happens? Senior leaders are sent a communication to nominate their HIPOs and voila the list gets created. Sure maybe there’s even a conversation that happens led by HR, but the outcome is much the same. Leaders lobby for their stars based on their previous track record of performance. Often times this nomination process generates a larger group than is necessary because it wouldn’t be fair, or economical, or politically correct if every function or every geography wasn’t represented. But if you want to make your investment pay off, you have to invest in the right people in the first place. 

  • Do you have an objective and valid way to assess people for potential?
  • Are you comfortable with segmenting your talent and providing additional opportunities to your HIPOs?

“We invested a significant amount into the HIPO programs, but we just don’t seem to be getting the return we thought we would. Our pipeline isn’t much stronger than it was before.”

The first thing wrong with this scenario is that HIPO development is viewed as a program rather than a talent management strategy that is embedded in multiple processes in your organization. 

Organizations over-rely on formal development programs. It’s easy to build an in-house program or buy one from an expert. Check the box; fill the seats; we have a HIPO program. Don’t get me wrong, formal development programs are great for aggregate skill development and for getting a group together to network and build a community of leaders. But most organizations stop there. If you really want to stretch and accelerate growth you have to provide individualized support through assessment, coaching, mentoring, and sponsorship. You also have to create assignments, projects and opportunities for moves in role, function or geography. When I advise organizations on these important accelerators, I get nervous stares because this is where the true investment is. This takes work and commitment by leaders in your organization. 

Organizations that get HIPO development right don’t wait for formal programs. Managers are talent developers, not mere performance managers. Top talent is continually being developed within departments everywhere. And when enterprise wide HIPOs are determined, it is the executive team that takes ownership for their retention and advancement.   

  • Is your culture of talent development strong enough to pull your stars through the organization?
  • Who is ensuring your enterprise wide HIPOs are getting the experiences and support they need to advance?

“I can’t believe Alex left! We invested so much in him. We really thought he would be the next one promoted.”

The mistake here is not following your HIPOs through the lifecycle. If HIPOs are valuable employees for you, they are targets for other organizations and head hunters too. In fact research has shown that the engagement of HIPOs can be quite low especially when pay for performance is not in place. If you treat everyone as equal, you may risk losing those who matter most. HIPOs also want and need to be given meaty projects, exposure and continual challenges. If you can’t provide it, then they will find it somewhere else. The real work with HIPOs begins after the formal program is over. You need to continually invest time in protégé relationships and transparent communication around what is possible over what period of time.

  • Do you establish quid pro quo relationships with your HIPOs so that investment in them is brought back into the organization?
  • Do you have continual honest conversations about how HIPOs are progressing and what opportunities are available for them, big and small?

Whether you’re looking to establish a new, or revamp your old HIPO strategy, first stop and ask yourself whether you are creating just another leadership development program. If you want to grow and retain future leaders, ensure first you are assessing and selecting the right ones. Then ensure you have the organizational commitment from your leaders to create the experiences and the plan to grow and retain the leaders you need.

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