Today, HR teams are obsessed with gauging employee behavior, work patterns and identify key characteristics/personas. Among these, specialized programs for HIPO or high-potential employees have fast gained popularity.
What is a HIPO?
While definitions tend to vary, a HIPO employee is demarcated on the basis of probability and judged as someone, who, in the future, will become a key contributor in the organization. This is a person that the company will invest heavily with learning & development and business role opportunities to succeed.
Now, most HIPO initiatives are designed to enhance productivity and improve bench-strength. HR professionals are, in fact, pushed by research (and budgets constraints) to embrace this idea, given that a number of studies suggest that only 5% of employees require special treatment since they will later take on positions of power. But unfortunately, this is often counterintuitive. Did you know that according to Gartner, 73% of HIPO programs show no ROI? In fact, the HIPO principle has a notorious track record of underperformance. Among the 300+ strategies analyzed by Gartner, less than 80 nurtured HIPO employees.
What happens to the non-HIPO people?
Statistics show that one out of every seven employees is labeled as a HIPO. So, what happens to the rest of the population? Are they kept right at the end of the line, abandoned and not taken seriously? Should we not invest in them? More importantly, if you ask many of them about their companies HIPO initiative, chances are they’d say that they feel ‘demoralized’ and ‘disheartened’. In fact, if there was ever the possibility that the individual would push forward, change things around and build on their core competencies, it’s a high probability that they will take a back seat now.
Additionally, what’s more worrying about these programs is that the selection of most HIPO employees is subjective and loaded with biases. Even if told to the employee, it generally leaves them confused, embarrassed and sometimes, feeling unqualified. Placing them in a position of entitlement without truly or totally testing their capabilities, actually creates a disengaged, demoralized and uncompetitive environment that has a direct impact on organizational productivity.
Let’s now further extend the argument against just HIPO culture.
3 reasons why ‘HIPOism must go’
1) Performance isn’t potential
One of the biggest challenges to any HIPO initiative is that it only thinks in the short-term and identifies current performance as a key indicator. Firstly, organizations don’t always accurately measure performance. Secondly, performance at a basic, task-based level doesn’t guarantee genuine effectiveness in higher, more complex roles.
An individual contributor, when promoted to a manager, and when a manager is made a senior business leader — all on the basis of a HIPO plan — they might eventually fail to make the cut or might not want that success. This is because as you go higher up, there are multiple capabilities one requires, from leading diverse teams, managing external stakeholders, architecting the overall enterprise vision and often, solving complex and intricate problems.
2) A rise isn’t always equal to effectiveness
Most HIPO programs work as a direct corridor to leadership. This does make sense in a way given that the top talent in a company must manage its resources, take key strategic decisions and create an appropriate organizational structure.
Again, short-term performance is hardly a barometer for leadership. Remember, it’s one thing to emerge and another thing to be effective. A great organizational leader isn’t just good at his/her core competency, but also must possess several other important skill-sets — the ability to network with various people both inside and outside the organization, a commitment towards setting goals for employees, managing targets at a pan-organizational level and constantly bringing people together. It means that they must have sound judgement, a highly-evolved sense of empathy and the ability to accurately estimate what needs to be done next.
By merely focusing on immediate performance and the ability of a worker to push oneself to the forefront of the attention, one may bypass those silent workers who actually possess all of these above characteristics.
3) Development should have no partiality
(Source: Dept. Of HR )
Regardless of an employee’s current success or delivery patterns, everyone deserves a chance at growth and development. In fact, studies suggest that the core aptitudes for becoming a leader exhibit themselves at a young age.
However, what’s needed is a mindset shift in the organization to start introducing continuous feedback, adaptive learning, and foster collaboration & teamwork. This is why L&D must move from being a cost center to a profitable entity, with a seat at the business table, focused on quantifiable and measurable results that yield productivity improvements and develop individual development paths for all. Of course, there will be levels, layers and appropriate segmentation. What’s necessary is to create a detailed program that’s built on an atmosphere of positive reinforcement and is powered by data and analytics and a workplace environment that inspires and energizes all employees