Assessing performance and potential

A typical tool for organizations to assess talent is the 9-box grid. One axis is performance, and the other axis is potential, choices being low-medium-high. It allows for a simple framework for categorizing talent so that differentiated actions and investment is possible. What is more difficult is to have a balanced and objective discussion to truly slot the existing talent into the right categories.

The performance axis is often based on the organization’s annual performance management process, and the low-medium-high categories align with the performance rating scale. To make investments in talent more meaningful, the expectation is that managers are challenged to use consistent performance standards, so that not every employee falls into one category. Another consideration is to make sure that performance is not only evaluated based on pure results, but also on behaviors: How the results were achieved. Otherwise the organization runs the risk that people who leave behind dead bodies to reach their goals are viewed as top performers – a recipe for becoming a morgue.

The Corporate Leadership Council has developed a simple model for assessing potential. It has three elements that need to be evaluated: Ability, engagement and aspiration.

Ability encompasses the inherent talent and the skills acquired in the employee. When assessing leaders, these often include business acumen, technical and functional expertise, and leadership skills. When assessing potential as part of ability it means looking at the learning agility of the employee: How fast can they grasp new and complex concepts? Are they able to take on stretch assignments and unfamiliar responsibilities? How far can they reach?

Engagement is another component of potential. Does this employee LOVE this organization? How dedicated are they? How high is the emotional attachment? We are looking for passion. Lukewarm employees will not go as far as champions.

The last element is aspiration. You cannot push a rope. The employee’s drive and ambition is a key determinant of where their career will take them. They will be asked for personal sacrifices from time to time. Relocation is often part of the career path. High potentials actively manage their own careers.

Based on trusted dialogues with employees and objective discussions among the leadership team, the 9-box exercise can give a good snapshot of the talent pool of the organization. The next step is to act on that information.

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The Peter Principle: Is your organization run by incompetent people?

The Peter Principle was developed by Dr. Laurence J. Peter and Raymond Hull in 1969, and asserts that “in a hierarchy every employee tends to rise to their level of incompetence”. In other words, according to this principle, organizations keep promoting employees until they reach their level of incompetence. What are ways to avoid the Peter Principle creeping into your organization?

Everyone in Human Resources is familiar with another principle: “Past performance is the best predictor of future performance.” This is a good rule of thumb, as long as the job role and the environment are not changing significantly. Put your star sales producer into a sales manager position and you might be up for a surprise. Your best leader in solid growth years might not be your go-to person in a turnaround crisis.

So what are your tools to make sure you have competent people in every position? First of all, be clear of what competencies are required for success in each job. When you promote internally, you should be just as specific and demanding as hiring externally.

Second, the 9-box assessment is a wonderfully simple way to discuss among the management, which employees have reached their limit and which ones have a great journey ahead. A 9-box grid categorizes employees based on their current performance (low-medium-high) and their future potential (low-medium-high). Based on these two dimensions, the organization can design targeted development programs for them.

Third, promote learning agility as a competency across your organization. Select employees that are eager to learn and try new things. Promote a culture that is open to feedback and change. Encourage everyone to learn from mistakes instead of looking for someone to blame. This creates an employee base that is less likely to get stuck in their level of development.

Fourth, create talent processes that systematically push new talent upwards. Define key positions and what type of competencies and experience they require. Slate high performers and high potentials for the positions, and intentionally create experiences they need to gain. Let them test their skills before they have to step up. Coach and mentor them until they are ready to move. When it’s time for promotion, they have already proven their competence. The Peter Principle can go and hover above some another organization.

If you need help with 9-box assessment or high potential development plans, contact Liisa Pursiheimo-Marcks at liisa@forteconsulting.biz or at 512-484 8263.

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