They represent 20 percent of your workforce, but do 80 percent of the work. These are your high-performing employees whose can-do attitude and recognized expertise in their particular area of your business consistently produce results. So, is promoting them to management the right move?

Maybe not, said Krishna Powell, a consultant with 20 years’ experience in HR, who led Tuesday’s NJBIA Business Bootcamp “Hidden Profit: High Potential vs. High Performing Employees.”

Krishna Powell of

Krishna Powell of HR 4 Your Small Biz

“Studies have shown that only 15 to 30 percent of high-performing employees are also high-potential employees who can succeed in leadership positions,” Powell said. “That’s why it’s crucial not to confuse the two. Performance is not potential.”

Companies make a costly mistake when they assume the only way to retain high-performing employees is by promoting them, Powell said. An even bigger mistake is basing promotions on how well employees do their current job, instead of their skill set for the new position. Worse yet is to place someone you want to groom for management on the “leadership track” without getting any input from them.

“Not all high-performing employees want to be leaders and most managers are surprised to find that out,” Power said. “Companies looking to retain these high-performing employees need to engage in an open dialogue with them to find out what motivates high-performers to stay.”

Powell said high-performing employees who don’t aspire to the corner office can be motivated by new and challenging projects, opportunities to share their expertise, face-time with management and other forms of recognition. Small tokens of appreciation for a job well done are effective, but only if the boss first makes an effort to find out what the employee’s outside interests are.

“Don’t give baseball tickets to someone who doesn’t like sports,” Powell said. The point is to make the high-performer feel appreciated, not annoyed that you know so little about them.

Laurence J. Peter, who nearly 50 years ago formulated the management concept known as the Peter Principle, warned that if companies keep promoting their high-performing employees to management jobs for which they are unqualified, the business will, over time, become one in which every position on the organization chart is filled by an incompetent person.

“You need to have the right people doing the right jobs at the right time,” Powell said. The key is to learn how to identify high-potential employees from the rest of the high-performers, she said.

“A high-performing employee knows their job and does it well, but a high-potential employee understands your business,” Powell said. “High-potential employees are self-motivated, goal-oriented, and have earned the respect from other employees who want to work and collaborate with them.”

A high-potential employee needs to know that the boss is thinking about them and their future role in the organization, Powell said, noting this needs to be an on-going dialog, not something conveyed only once a year as a part of an annual performance review.

Motivate high-potential employees with greater visibility, cross-training, a clear career road map, mentoring, and consistent encouragement and support, Powell said. Above all, be patient.

It takes at least two to three years for someone to develop the skills needed for a senior leadership position and there will be failures along the way, Powell said.

“You’re not going to knock it out of the park with all of them,” Powell said, noting only one of six will succeed in senior leadership positions. “That doesn’t mean the other five aren’t valuable employees, they’re just valuable to your organization in a different way.”

Krishna Powell is a principal at HR 4 Your Small Biz, an HR consulting firm based in West Trenton that provides HR audits, background checks, professional development, customized workshops, strategic planning and mediation. For further information, Powell can be reached at 609-436-9363.