In 2021, Airbnb faced one of the most significant challenges in its history. The travel industry was in turmoil due to the pandemic, and the company had to lay off a quarter of its workforce. However, Airbnb’s investment in leadership development over the years allowed it to recover swiftly. The company had nurtured a group of high-potential employees who were prepared to take on critical roles and drive innovation. Airbnb’s ability to foster a culture of adaptability and resilience ensured its survival and propelled it to record profits by 2023. This case highlights a crucial truth: leadership development is not a luxury—it’s a necessity.
Many organisations, however, struggle with identifying and nurturing high-potential employees. Some rely too heavily on instinct, while others conflate high performance with high potential. Without a structured approach, they risk leadership gaps, stagnation, and even attrition of top talent. So, how can organisations effectively identify and develop these future leaders?
Identifying High-Potential Employees Beyond Current Performance
A common pitfall in leadership development is assuming that top performers are future leaders. While high performance is a factor, it is not the sole determinant of leadership potential. High-potential employees (HiPos) exhibit three critical traits:
- Ability – Cognitive agility, problem-solving skills, and technical competence.
- Aspiration – A strong desire to grow, lead, and take on greater responsibility.
- Engagement – Commitment to the company’s mission, values, and long-term success.
Take the example of IBM. The company realised that performance reviews alone were insufficient in identifying future leaders. Instead, they implemented a rigorous evaluation process combining peer feedback, psychological assessments, and leadership simulations. This multi-faceted approach ensured that their HiPo pool included not only high performers but also those with the strategic mindset and resilience needed for leadership.
Nurturing High-Potential Employees Beyond Traditional Training
Identifying HiPos is just the first step. Developing them requires an intentional strategy that goes beyond conventional training programs. Here’s what works:
1. Strategic Job Rotations and Cross-Functional Exposure
A common mistake that organisations make is keeping high-potential employees in their comfort zones for too long. To truly develop leadership capabilities, organisations should implement structured job rotations across different functions and departments. This allows HiPos to gain a broader business perspective, develop cross-functional expertise, and build relationships across the company.
For example, Siemens has an internal mobility program that moves high-potential employees through various leadership roles across engineering, sales, and management. This ensures that by the time they step into senior leadership roles, they have a well-rounded understanding of the company.
2. Data-Driven Talent Assessments and Leadership Forecasting
Rather than relying on traditional performance reviews, organisations must use predictive analytics and AI-driven talent assessments to identify and track leadership potential.
Companies like Unilever and Nestlé use sophisticated HR analytics tools to assess leadership traits, work habits, and decision-making abilities. These tools help HR teams forecast which employees have the potential to take on executive roles in the next five to ten years, allowing for better succession planning.
3. Stretch Assignments and Crisis Leadership Opportunities
High-potential employees should not just be given leadership theories. They should be placed in challenging real-world situations where they must apply their skills. Assigning HiPos to lead major projects, handle corporate crises, or spearhead business turnarounds can accelerate their leadership growth.
A great example of this is Tesla, which often assigns its HiPos to lead high-pressure projects with minimal oversight. Those who thrive under these conditions quickly move into executive roles, while those who struggle receive targeted development opportunities.
HR Strategies for Long-Term HiPo Development
Beyond individual training methods, organisations need structured HR strategies to identify, engage, and nurture their high-potential employees. Here are three proven approaches:
- Succession Planning and Leadership Pipelines
Companies should maintain an active leadership pipeline by mapping out future leadership needs and aligning HiPo development with business objectives. PepsiCo, for instance, has a detailed succession plan where promising employees are groomed for C-suite roles years in advance.
- HiPo Recognition and Incentive Programs
High-potential employees should feel valued and motivated to stay. Implementing special recognition programs, fast-track promotions, and financial incentives can help retain top talent. Salesforce, for example, offers HiPos exclusive leadership retreats and accelerated career progression.
- Culture of Internal Mobility
Instead of hiring external leaders, companies should prioritize internal promotions. Firms like Schneider Electric and Microsoft encourage internal mobility, ensuring that HiPos have clear career paths within the organisation rather than looking elsewhere for leadership roles.
Overcoming organisational Barriers
Despite the best intentions, many organisations face barriers in HiPo development. Some of the most common challenges include:
- Managerial resistance – Some managers hoard top talent instead of supporting their growth.
- Lack of clear criteria – Without standardised assessment methods, identifying HiPos becomes subjective.
- Short-term focus – organisations prioritising immediate results over long-term leadership development risk losing future executives.
The Challenges in Bangladesh
In Bangladesh, these barriers are even more pronounced due to specific cultural and structural challenges. Many organisations, especially in traditional industries, rely heavily on seniority rather than leadership potential when promoting employees. This leads to stagnation, as younger high-potential employees feel overlooked and leave for better opportunities abroad or in multinational corporations.
Additionally, hierarchical workplace cultures often discourage HiPos from taking the initiative. Unlike in Western corporations, where leadership skills are actively nurtured through mentorship and open communication, Bangladeshi organisations often operate in rigid, top-down structures where decisions are made at the highest level with little input from emerging leaders. This limits the growth of leadership talent from within.
To overcome these challenges, Bangladeshi organisations must actively modernise their HR strategies. Companies like Grameenphone and BRAC Bank are leading the way by implementing structured leadership development programs, encouraging open feedback cultures, and providing HiPos with exposure to international best practices. More companies need to follow suit if Bangladesh is to develop a strong, future-ready leadership pipeline.
The Long-Term Impact of Investing in Future Leaders
organisations that proactively identify and develop high-potential employees secure their future competitiveness. Look at companies like Procter & Gamble and PepsiCo, which have produced an impressive roster of CEOs across various industries. Their secret is a relentless focus on structured leadership development, mentorship, and performance-based career progression.
Leadership cannot be left to chance in a fast-changing business world. Top organisations actively scout, nurture, and refine their HiPo programs. This ensures they have a bench of capable, visionary leaders ready when needed. The question isn’t whether leadership development is necessary—it’s whether organisations will invest in it before it’s too late.
Author: Nusrat Jahan
