The HiPo Effect: How to Identify and Nurture Your High Potential Employees to Maximise Corporate Growth

Few executives and HR managers would dispute that some employees show more potential than others. It is a fact of organisational life. And while many organisations understand the importance of their high potential employees (HiPos), research suggests that programs designed to nurture talent aren’t being successfully developed and implemented. This means many organisations are missing out on a significant increase in productivity, efficiency and corporate growth.

SHL research suggests that HiPos bring 91% more value to an organisation, and exert 21% more effort than other employees. So how can you identify and nurture your high potential employees to not only keep them, but to ensure a talent pipeline and healthy succession planning for your organisation? In this article, I will answer this question by first looking at what a HiPo is, how to identify them, and the benefits of delivering an effective employee development program.


What is a High Potential Employee or HiPo?

According to Harvard Business Review, high potential employees or HiPos “consistently and significantly outperform their peer groups in a variety of settings and circumstances. While achieving these superior levels of performance, they exhibit behaviours that reflect their companies’ culture and values in an exemplary manner. Moreover, they show a strong capacity to grow and succeed throughout their careers within an organisation—more quickly and effectively than their peer groups do.”

In short, a HiPo is someone who is likely to become a key player within your organisation, meaning they are worthy of special care, development, and retention. But when determining who the HiPos are, it is important to keep the emphasis on potential. Often, employers confuse potential with performance, and they are far from being the same thing. As Tomas Chamorro-Premuzic writes in Forbes, “performance is what you do, and potential is what you could do.”

As individuals rise through the ranks from contributors to leadership roles, the skills and capabilities that ensure their success will change. Just because a talented employee performs well in their current position, doesn’t mean they have an ability or even the aspirations to take on a more senior role. In fact, judging an employee’s readiness for a new role based solely on their performance in their current position, may have the unfortunate result of:

  1. removing an employee from a position in which they are happy, engaged and performing well,
  2. placing them in a leadership role for which they are not ready.

It is for this reason that focusing on potential, in addition to performance when determining who your HiPos are, is especially critical.


How to Identify a True HiPo

Most organisations will have identified 3% to 5% of their employees as being high performers or having high potential. But to truly determine those who will be likely to rise to and perform within senior positions, requires careful assessment of three distinguishing attributes – Aspiration, Ability and Engagement.



Aspiration refers to an employee’s willingness and desire to tackle the challenges and opportunities associated with leadership roles. HiPos may demonstrate an interest in being involved in decision-making processes, and they often desire more responsibility and independence. They proactively seek out new challenges and crave constructive feedback regarding their performance.



Ability refers to the combination of an employee’s inherent qualities and their learned skills. HiPos don’t just do their jobs well, they are also fast learners who leverage their existing strengths to help them acquire new skills quickly. They welcome professional development opportunities and recognise the value in supplementing their talents with new knowledge and best practices. 



HiPos are exceptionally engaged employees, demonstrating a significant commitment to the success of the organisation that extends beyond their own individual performance. They often exemplify many of the qualities that are most valued within the company culture, and can be seen assisting other employees with the aim to reinforce the overall efficiency and success of the team.

SHL’s research suggests that talent who lack even one of the above attributes have less than a 40% chance of success at the next level. SHL’s ‘How to Reduce Risk and Realise More Value in Your HiPo Program’ eBook continues to say:

“Through objective assessment of all three factors, you can accurately identify your top talent while ensuring you avoid the most common HiPo program risks:

  • The risk that they will fail to rise to a senior position
  • The risk that they won’t be effective in a more challenging role
  • The risk that they will leave to join competitors, diluting your bench strength


How to Nurture HiPos

The important thing to remember when discussing programs to retain and progress HiPos is that these individuals have been identified as having potential. They are not fully-fledge leaders, ready to step into a senior or critical role – yet. They likely will be, but they need developing and nurturing.

These individuals are also ambitious and are looking for new challenges either within your organisation or someone else’s. Simple acknowledgments will not keep a HiPo on the path to leadership. Their aspiration, ability and engagement needs to be rewarded and nurtured in meaningful ways. Otherwise, they will look for this somewhere else.

SHL’s research shows that the most effective high-potential programs provide individuals with a clear career path, offer structured development opportunities that are aligned with personal career goals, and provide challenging work assignments.

Traditional training approaches need to be supplemented with on-the-job experiences, mentoring and senior support for a HiPo to fully develop their leadership skills. According to SHL:

“The most effective high-potential development activities are centred on highly visible, important, and challenging experiences. These experiences not only place individuals in assignments where their potential can be applied and realised, they also drive up organisational commitment and aspiration among HiPos.”

When it comes to developing high-potential programs within your organisation, consider implementing the following:

  • Assessments for your employees to determine strengths and areas for growth
  • ‘Enrichment’ training either through courses or mentorship to further develop their strengths and specific skills
  • Regular feedback and training opportunities to address any areas for growth
  • Reinforced learning opportunities through on-the-job experiences and new assignments
  • Personal progression plans aligned with career goals and progress assessments
  • Internal support programs and guidance from current leaders


The Benefits of the Right HiPo Program

HiPos represent a company’s strongest leadership pipeline, and an investment in their success is an investment in your organisation’s future.

We know that key players won’t be around forever, so by nurturing your high potential employees, you are avoiding having to replace top talent with external candidates. An external recruitment drive can be more expensive and have lower chances of success. Even when you hire people with the right skills, they may fail to adapt to your organisation’s culture, and replacing them can cost a small fortune.

Furthermore, investments in programs that actively identify and develop HiPos into successful leaders can have a positive impact on your organisation’s performance and bottom line. SHL has identified the following results:

  • Strong leaders can achieve over 90% more revenue
  • Strong leaders can achieve 2 x more profit growth
  • Organisations that foster an effective learning environment can experience a 14% increase in performance

By identifying, cultivating and investing in employees with exceptional aspirations, rare abilities, and greater engagement, you can ensure that the next generation of leaders within your organisation will be equipped to boost performance, foster innovation, and maximise corporate growth.