High-potential employees, or HIPOs, are supposed to be an organization’s future. However, correctly identifying which employees have the most potential is often a difficult task, due to ambiguity surrounding the term HIPO and the fact that most managers don’t seem to believe their organizations’ criteria for high potential are accurate. Moreover, HIPO selection is easily “politicized”: In a recent Harvard Business Review post, Tomas Chamorro-Premuzic and Abhijit Bhaduri discussed six ways managers often play politics in identifying, promoting, and developing HIPOs, namely the politics of intuition, self-interest, avoidance, favoritism, ageism, and gender:
In short, the politics of potential can prevent organizations from upgrading their leadership talent and make data-driven decisions an anomaly rather than the norm. Too many times we have seen the CEO’s favorite candidate be put through a formal assessment simply as a way of confirming a decision that has already been made in advance, not for merit.
Our research at CEB, now Gartner, has touched on all of these political dynamics, and fortunately we’ve found some straightforward and practical solutions to the problems identified here. Organizations using best practices are ensuring their HIPOs are managed as enterprise assets and not held captive to the whims of a manager. Here are some real-world examples of how organizations are overcoming the six political barriers Chamorro-Premuzic and Bhaduri identify (and CEB Corporate Leadership Council members can click through the below links for more information on our research):
The politics of intuition occurs when managers “follow their gut” when nominating HIPOs based on their own judgement of employee performance and future capability. Instead, all managers within an organization should have standardized, clear, and business-relevant criteria to identify HIPOs. CEB recommends evaluating employees for potential against three key characteristics: Ability, aspiration, and engagement. Critically, managers need to be involved in validating the details of these criteria to ensure that HIPO they are not an abstract HR concept. Our recent study on high-potential employees shared a real-world practice Black Hills Corporation uses to align HIPO identification to changing business needs, in order to identify the best HIPOs to fill emerging leadership opportunities.
According to our diversity and inclusion research at CEB, now Gartner, creating an inclusive team climate is just as important as improving diversity. However, organizations still struggle to determine what inclusion looks like for them. For many of us, the concept of diversity is concrete, but inclusion feels a lot less defined. D&I budgets are increasingly focused on leadership development and D&I leaders are making inclusive leadership a priority, but most employees don’t agree that their manager fosters an inclusive environment, and perceptions of inclusivity are lower further down the organization chart than they are among senior leaders.
In a session on building inclusive leaders at our ReimagineHR conference on Wednesday, we heard from Bob Lennon, VP of Industrial Components Business at Rockwell Automation; Aida Sabo, VP of Diversity and Inclusion at Parexel; and Celeste Warren, VP of HR and the Global D&I Center of Excellence at Merck, about how they are defining inclusion for their organizations and implementing it in their organizational cultures. Here are some key ideas that came up in Wednesday’s conversation for how to encourage inclusiveness among leaders and the entire workforce:
Create a Common Language of Inclusion
The definitions of “diversity” and “inclusion” can vary across organizations and each leader and employee also may have a different interpretation of how these live within the company. The most successful organizations, however, define the D&I narrative for all their leaders and employees globally. By using a common vocabulary to communicate D&I efforts to the workforce, the organization can have a clear understanding of what inclusion means. Storytelling also can be an essential tool for communicating the success of inclusion initiatives, as it is important to know what metrics and success stories to share with leaders, employees, and external stakeholders to create transparency and accountability.
Make Inclusion About the Entire Workforce
Oftentimes employees who do not identify as a part of a marginalized talent segment feel excluded by D&I efforts, but according to our panelists, it is not only important to get these employees to buy into inclusion, they are in fact an essential part of these initiatives. Some employees get stuck because they don’t know where they are in their own journey of inclusion or recognize the significance of supporting D&I as an ally.
At our ReimagineHR summit in Washington, DC, on Wednesday, dozens of heads of HR, HR business partners, learning and development leaders and specialists convened in a peer benchmarking session on leadership, or more specifically, what their organizations are doing to improve the effectiveness of their leadership in the future.
When we talk about leadership, different people and organizations have different ideas of what the word “leader” means. Most of the organizations represented in the room define “leader” as anyone who manages other people, while about 20 percent said it referred specifically to the top three to four layers of management, whose decisions affect the entire company. Other participants noted that while they have a specific definition of “leader” as manager, they expect all of their employees to demonstrate leadership, or identify employees who are not managers themselves but still lead their colleagues through their influence.
When we talk about leadership development, though, we are usually talking about identifying the people who will succeed the current generation of senior managers and executives at the organization. Here are some of the topics that came up in Wednesday’s discussion of what HR professionals are thinking, worrying, and getting excited about as they try to identify the leaders of tomorrow:
Developing Leaders for the Future Is the Primary Concern
The majority of participants said this was their biggest challenge at the moment. In the conversation that followed, several people attributed this challenge to the rapid pace of change in today’s business environment. Developing people within an environment of constant change is tricky, they said, as it becomes harder to be sure that what leaders and prospective leaders are learning today will still be valuable to the business when the time comes to use it. Even more importantly, the consistency of change means that leadership development becomes an ongoing journey. An employee can no longer acquire a single set of “leadership skills” and believe they will always be ready to lead with that skill set.
CEB's Clare Moncrieff (L) and Mazars CLO Tyra Malzy (Simon Meyer)
According to recent research from CEB (now Gartner), in order to create an inclusive climate for teams, organizations need to focus not only on climate quality (the average level of inclusion that employees feel) but also on climate strength (the variation between how different employees perceive the inclusivity of their team). In a session on building inclusive leaders at our ReimagineHR conference in London on Thursday, we heard from Tyra Malzy, Chief Learning Officer at Mazars, about her experience integrating inclusion into her company’s business practices and engaging its younger workforce in decision-making. Here are some of the strategies she shared:
Normalize Inclusion in Leadership
As Malzy explained, Mazars needed to reach out to its millennial employees and help senior leadership see the business value of including these employees in its decisions. To meet these goals, the company made several key choices.
- Start with saying “yes”: Mazars found that when leaders were concerned with the impact of change, they often responded in a risk-averse manner, usually resulting in saying “no” to ideas that deviated from the organization’s typical decision-making process. By making a habit of saying “yes” more often, this helped generate a more open environment for co-developing solutions.
- Crowdsource ideas from employees: An important component of making leadership more inclusive is empowering employees to lead from the ground up. Mazars created an app for individuals to share their ideas with others within the company, vote on those which they like the best, and then have the top five presented to senior leaders. Finally, the executive team picks which business ideas to implement. Mazars also surveyed employees to understand their thoughts on management preferences and organizational culture. They then used this information to create specific projects associated with the interests of the employees.
- Bring visibility to functions and individuals that are doing this well: By sharing examples of diverse groups that are outperforming other teams or functions, Mazars challenges teams with limited diversity to step up their diversity of thought and improve their outcomes.
Create a Culture of Inclusivity in Decision-Making
McDonald’s and Ben & Jerry’s may not have a lot in common in their corporate philosophies, but both companies have recently begun offering their low-skilled employees significant educational opportunities that will help them wherever their career paths may take them.
Eighty percent of employees at Ben & Jerry’s ice cream shops are in their first-ever job. The Vermont-based company is now offering them skills training through an online program called Core Academy, where employees can take one of four courses: Beyond the Job parts 1 and 2, Activism Academy, and Social Equity & Inclusion. These topics jibe with the company’s stated commitment to social responsibility.
“We started thinking about what are our responsibilities to this entry-level workforce,” Collette Hittinger, the ice cream company’s global operations and training manager, told SHRM’s Kathy Gurchiek earlier this month, “and we decided we had plenty of programs about how to run an ice cream store,” but nothing to develop skills that would enhance workplace and customer interactions, such as emotional intelligence. The training opportunity also prepares their workforce, 75 percent of which is aged 18-24, for leadership down the road.
Ben & Jerry’s developed the program in partnership with the local Champlain College and California-based Story of Stuff Project. The coursework draws from Champlain’s MBA programs for its content and project-based structure. Participation in Core Academy is voluntary, but the program has been very well-attended and received. It also allows Ben & Jerry’s to stand out in attracting workers for their minimum-wage service industry jobs.
McDonald’s is offering a more traditional education credential, as participants in its “Archways to Opportunity” program can earn a high school diploma through the fast food titan’s partnership with Cengage Learning. Since the 18-month program launched in 2015, roughly 100 employees have completed it and over 800 are currently enrolled. Amanda Eisenberg at Employee Benefit News has the details on the program, which is designed for adult learners:
Earlier this month, Jeffrey Immelt was replaced as CEO of General Electric after 16 years at the helm of the company. Much of the coverage has depicted Immelt’s stepping down as a result of investors losing confidence in his leadership after GE’s stock underperformed in the past year, as in this Bloomberg report, for example:
Amid mounting pressure from activist investor Trian Fund Management, GE said Monday that Immelt will be replaced by John Flannery, a 30-year company veteran who oversaw a jump in profits at the health-care unit. In a sign of just how great opposition to Immelt had become in the investing community, the stock soared the most in more than a year and a half after the announcement was made.
This was not a snap decision by GE’s board of directors, however. In fact, the planning for Immelt’s succession began not in 2016 or 2015, but all the way back in 2011. Susan Peters, Senior Vice President for Human Resources at GE, shared the company’s strategy in a LinkedIn post, illustrating a thoughtful process befitting a giant corporation responsible for hundreds of thousands of employees and hundreds of billions of dollars in assets:
First, we knew it would take years to move potential candidates through the leadership roles that would develop them. We began intentional moves of key leaders to give them new, stretch experiences with ever increasing exposure to complexity.
By 2012, we wrote the job description and then continuously evolved it. We focused on the attributes, skills and experiences needed for the next CEO, based on everything we knew about the environment, the company’s strategy and culture.
A new report from the Boston Consulting Group underscores a significant obstacle to the development of women leaders in global organizations: an imbalance of opportunities for global mobility. While women are slightly less willing than men to relocate internationally for work, BGC found that among those who are willing, fewer women than men are afforded the chance to work abroad:
Among the women we surveyed, 55% told us that they are willing to move abroad for a job assignment (including 44% of women in relationships and with children). Our research also shows that this percentage is not fixed: companies can take measures to increase it.
However, only a small subset of women currently get the opportunity to take international postings. According to our data, fewer than 30% of the women who were willing to move had actually done so, compared with nearly 40% of the men in similar situations. In other words, there’s a gender gap that companies need to overcome. If companies continue to assign more men than women to international postings, they will unwittingly be putting their promising female managers and executives at a disadvantage, decreasing the diversity of their future leadership teams.
Now more than ever, international experience unlocks doors to leadership roles in multinational firms, and while global competencies are hardly the only thing leaders in such organizations need to succeed, the absence of those skills can quickly derail a leader’s career path.