The Value Of Cultivating High-Potential Vs. High-Performance Employees

The key difference between cultivating high-potential and high-performance employees.

November 23rd, 2016   |    By: Gwen Farrell    |    Tags: Onboarding, Management, Employees, Planning, Hiring & Firing, Staff, Strategy

Here’s a question that sometimes confounds supervisors and HR departments alike:  Is there a difference between a high-potential employee and a high-performance employee?

The answer is yes, and confusing one with the other is apt to lead to some some poor promotion decisions down the road. It also could deny a business the full benefit of having truly high-potential workers on its staff.

A high performer is easy to spot, clearly excelling at whatever job he or she currently fills. But as the Peter Principle observed several decades ago, there is a tendency in business to serially promote competent people until they reach their level of incompetence. Thus, an asset can become a liability.


High-potential employees are not simply good at what they are currently doing. Rather, they embody many of the same qualities identified with successful leadership.  They are self-motivated, goal-oriented and recognize the steps needed to meet their objectives. They continually look for ways to improve and embrace a culture of learning that leads them to knowledge and skills that may be only tangentially — or perhaps not at all – related to their current responsibilities.

In addition, high-potential employees are not afraid to take prudent risks and to learn from failures and mistakes that ultimately could make them good leaders.  They also are strong communicators with the skills to collaborate well with others and attract the respect of colleagues and team members. They are prolific idea generators, and enjoy envisioning what can be accomplished.

But merely identifying high-potential employees, although crucial, is only part of the corporate task. An employer must take steps to cultivate them by encouraging career development and providing incentives to remain a company asset. A plan is necessary – one that includes the following steps:


High-potential employees should know that senior management recognizes and values their potential.  In addition to being a morale-booster, this demonstrates that management is committed to helping them advance within the organization.


High-potential employees consistently look for opportunities to increase their knowledge and skill sets. Allowing them to work in other departments or with employees in different sectors of the business and providing time to attend seminars that will expand their knowledge base will continue to motivate and engage them.


Even the most talented individuals can benefit from ongoing direction and feedback from supervisors. Managers should work collaboratively with high-potential employees to set goals. Feedback should be provided, so employees recognize their progress.


High-potential employees need to know that their abilities and efforts make a difference for them and for the company. Management should help employees understand how their efforts help the organization meet its short- and long-term goals.


Everybody appreciates praise for a job well done. This can be especially true when a challenging goal or a new milestone has been reached by a high-potential employee.


As noted, high-potential employees tend to be ambitious and eager to reach the next level of their careers.  When such employees realize that an employer is invested in their future, they may be more inclined to remain with the company and help it flourish.

High-potential employees can be great assets, with the capacity to make a major impact on an organization’s future success. Business entities should recognize and embrace them. It’s a sound way to help build a new generation of leaders, as well as to defeat the Peter Principle.

This article originally appeared on VentureApp

About the Author

Gwen Farrell

Gwen Farrell is a sales professional with a proven record of helping small businesses. As the owner of a successful small business, Gwen has an extensive background in increasing company revenues through improved employee engagement. Gwen naturally understands the challenges Business Owners face daily as well as the tremendous feeling of success. Gwen is actively involved within her community sharing her energy and enthusiasm with numerous school and athletic organizations as well as local entrepreneurial groups.

Discuss this Article

Unlock Startups Unlimited

Access 20,000+ Startup Experts, 650+ masterclass videos, 1,000+ in-depth guides, and all the software tools you need to launch and grow quickly.

Already a member? Sign in

Copyright © 2024 LLC. All rights reserved.