George, an SVP for a global company, told select employees on his team that they were considered “high potential,” and were being groomed to accelerate within the organization. After learning that they were on track for leadership roles, these employees became more invested in the company and committed to its success. They were motivated, eager to develop new skills that would help them advance, and unwaveringly loyal to George and the company. Article by by Dave Brookmire, Ph.D.

Meanwhile, Heidi, the CEO of a major corporation, decided with her CHRO’s advice and counsel to tell her company’s “high potentials” that they were on track for leadership roles and expected to elevate within the organization. Many of these high potential employees immediately became overconfident – and overbearing – with the promise of future success. They were indiscreet with the news, informing their peers that leadership had pre-determined who would rise among the ranks and who would not. High performing employees who had not been deemed high potential were disappointed and disillusioned, sullenly going through the motions at the corporation while looking for advancement opportunities elsewhere. Several key employees left a few months later.

Should leaders tell employees they're high potentials? There are pros and cons to doing so. Theadvantages to telling employees that they're high potentials include:Increased retention, motivation, & commitment. By telling high potentials that they have promising futures within the company, they'll become (and remain) more invested. Securing their involvement and active participation. If they believe they're on track to succeed, they'll be more committed to the company's success. Determining their mobility. If companies expect high potentials to relocate, it can be helpful to ask early on if they're mobile. If not, it may limit their opportunities, and leaders might consider other, more mobile talent for development and advancement instead. However, there are also disadvantages to telling, including: Employees start believing their own press. Praising them as high potentials may result in overconfident, unbearable employees.

The grapevine. If you're telling 10 percent of workforce they're high potentials, what are you telling the other 90 percent? Word spreads quickly in any organization, so once employeesknow who's considered high potential, the rest of the team could quickly become disillusioned, unmotivated and unproductive. The risk of creating a “caste system.” Once staff know who is considered high potential, it can create a caste system, causing tension between “the haves” and “the have nots.” They take on too much, too soon. High potentials want to prove they can handle additional responsibilities, and often they fail because they've taken on projects and responsibilities that they're not equipped to handle.

When debating about if – and when – to tell employees that they're high potential: Consider the “whole package.” Don't consider an employee “high potential” just because they perform well. They should also maintain strong relationships with colleagues, clients and other key stakeholders, always acting according to company values. Recognize and reward excellent work. Regardless of whether you're telling employees they're “high potential,” acknowledge when they're performing well. Reward hard work with bonuses, raises, and advancement. By recognizing strong performance, you're telling employees they're valuable, increasing their motivation, determination and commitment.

Coach top talent.

Provide high performers with increased training, responsibilities, mentoring and, ultimately, advancement. Nurturing strong performers is far more valuable than simply telling them that they're high potential. “Weed” employees out. Some leaders tell high performers their status, then weed out those that don't have the maturity to handle that level of candor. If, after learning that they're considered high potentials, employees become overconfident or obnoxious, it can lead to their demise, leaving room for more mature, hardworking prospects to advance instead.

Be specific.

The term “high potential” can be vague and open to interpretation. Be clear about your expectations for your employees, as well as benchmarks and timelines for their advancement. Decide whether you can afford to gamble. If an employee is a key asset, critical to the business, and on track to accelerate within your organization, can you afford not to tell them that they're a high potential with a bright future at your company? By staying quiet, do you risk having high performers deflect to competitors? Leaders must decide if the potential benefits of telling employees they're “high potentials” outweigh the possible risks. www.cpstrat.com.