‘High potential’ employees make up 15 percent of the workforce - 34 percent of them women and 66 percent men, according to a Deloitte study shared exclusively with Moneycontrol.
High potential talent refers to the set of individuals who demonstrate the potential to perform higher-order roles than what they are currently at. These higher-order roles can be typically at higher grades – vertically up – or can be critical roles identified by the organisation.
Interestingly, just 6 percent of companies formally inform people of their high-potential status. A formal process for managing high-potential individuals is present in 62 percent of organisations, according to key findings from a study on the subject. About 18 percent of organisations compare their personnel management procedures to industry’s best practices.
With 62 percent of companies saying they have a formal process for identifying high-potential employees, the Life Sciences industry leads the chart with 71 percent of companies having the process in place, followed by Manufacturing (65 percent) and Services (41 percent).
“Organisations use a combination of instruments to assess an employee’s potential. The simplest criteria [ranges from] being manager feedback to evolved ones as performance, personality profiling, behavioural competency assessment and functional assessments,” Dr Neelesh Gupta, Director of Human Capital Advisory Services at Deloitte India, told Moneycontrol.
When it comes to creating high-potential personas, 28 percent of organisations give more weight to observable behaviours than inherent abilities. High-potential talent is identified by several parameters, including leadership abilities, next-level capability, innate talent, and consistent high performance.
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The need to manage high-potential employees
In companies, high potential management involves three steps: identification, development, and effectiveness measurement. According to Gupta, these employees represent an organisation’s future leaders, and a formal process helps them identify, develop, and retain them before they get poached by competitors. This is the most vulnerable group.
While the report doesn’t specifically cover hikes, differentiation for top talent can be as high as 2.8X as compared to average increments. In terms of percentage, top talent can receive a hike of as much as 27 percent, considering an average increment of 9.8 percent.
“Further, by having a ready pool of qualified talent, organisations can seamlessly fill leadership positions when they become available, ensuring continuity and stability. Growing talent from within helps build institutional knowledge and capital – a time-dependent currency,” Gupta said.
Other retention tactics include funding or support for further education, certifications, workshops, conferences and offering double promotion, among others.
Gender-wise distribution
At the junior level, where 15 percent of the workforce comprises high-potential talent, women hold 29 percent of the positions. On the other hand, at the middle level 14 percent of the workforce has high potential, of which 37 percent are women.
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“Typically white collar female workforce representation in India Inc is 20 percent. These numbers vary by industry with tech being highest, and manufacturing recording the lowest. Progressive focus on diversity initiatives is helping drive better representation in the High Potential cohort in both Junior Management and Middle Management. However, we’re still far away from 50:50 representation,” Gupta said.
The survey reached out to more than 150 companies with an average headcount of 2,600 employees and an average revenue of Rs 5,340 crore.
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