Every succession plan depends on one question: who are the people worth developing for bigger roles? Getting it wrong is costly in both directions. Overlook a high-potential employee and they may leave. DDI's Global Leadership Forecast 2025 found that 21% of high-potential individual contributors intend to leave, up from 13% in 2020. Promote the wrong person and a team suffers.
What is the difference between performance and potential?
Performance is how well someone does their current job. Potential is how likely they are to succeed in a bigger, more complex one. The two overlap, but they are not the same. A top individual performer may struggle to lead others. A solid performer may grow quickly once given a stretch role.
What signals show high potential?
Look for evidence of all three of these together:
- Results. They consistently deliver in their current role. Potential without performance is rarely enough.
- Learning agility. They learn fast in unfamiliar situations, ask good questions, take feedback well, and apply it.
- Aspiration. They actually want more responsibility, and are willing to do what a bigger role requires.
Other useful signs: they influence peers without authority, they handle ambiguity calmly, and they think beyond their own team.
What tools help you identify high-potential employees?
- A talent review. Senior leaders discuss each candidate together, using examples from real work, so one manager's view does not decide.
- A simple grid. Many companies plot people on performance versus potential (often called a nine-box grid) to guide the conversation. Treat it as a conversation tool, not a verdict.
- Assessments. Leadership assessments such as the MLEI or a 360 add data that conversation alone can miss.
- A stretch test. Give a promising person a short, real stretch assignment and see how they handle it.
What mistakes should you avoid?
- Equating visibility with potential. The loudest people are not always the most capable.
- Ignoring aspiration. Ask people what they want. Not every strong performer wants to lead.
- Labeling too early or forever. Revisit the list every year. People grow, and circumstances change.
- Identifying people and then doing nothing. A high-potential list without development plans is just a list.
How does The Executive-Panel help?
The Executive-Panel helps organizations assess bench readiness and develop the next leaders with coaching tied to real roles and real work, as part of succession planning across the pipeline. Book a free consultation to talk through your bench.
Related reading
- What Is Succession Planning? A Practical Guide for Growing Companies
- Leadership Development From New Managers to Executives: What Each Level Needs
Frequently asked questions
Should you tell employees they are considered high potential?
Usually yes, in terms of investment and growth rather than a promised job. People who know the company is investing in them are more likely to stay.
What is a nine-box grid?
A nine-box grid plots employees on two scales, current performance and future potential, to guide talent discussions. It works best as a starting point for conversation, not as a final rating.
How many high-potential employees should a company have?
There is no fixed number. Focus on having at least two developing candidates for each critical role in your succession plan.
