5 Ways to Assess Leadership Potential in Your Employees

It makes sense to hire from within. Outside candidates are more costly, take longer to adapt, and leave at higher rates. By contrast, promoting internally costs next to nothing and fosters company loyalty. Plus, you already have a good read on your candidates’ abilities and company fit. So, how do you choose from your current pool of employees? Here are five ideas to consider when hiring your next supervisor or manager. 

#1. Consider Diverse Candidates

According to the Harvard Business Review, managers are more likely to promote people with a similar background, education level, attitude, and personality. We’re even partial to people who dress in a similar fashion. In other words, we tend to hire people that remind us of ourselves. However, a diverse team ensures a variety of skillsets, strengths, and approaches. And diverse leadership is correlated with greater innovation and revenue, according to Forbes. A 2018 study showed that companies with diverse executive teams generate 19% more revenue. 

When hiring, managers should look for someone with complementary — but not identical — traits to create a well-rounded team.

#2. Control for Likability

Likability is a powerful influence. It’s natural to want to work with someone you have chemistry with. Unfortunately, the most likable candidate may not be the most qualified. Some leadership roles may even be undermined by a person that is overly agreeable.  

One way to overcome the likability bias is to adopt a standardized evaluation. An unstructured interview may be tempting, especially with people already familiar with us. But conducting a formal interview levels the playing field and ensures the candidates are evaluated on exactly the same criteria. If you decide likability is critical to the role, control for it by including it on the assessment form. Then it can be scored like other traits, versus unduly influencing your decision.

#3. 360 Degree Evaluation

As the name suggests, this method gathers information from all directions — clients, colleagues, and other managers. Considering multiple perspectives can help overcome personal bias when hiring. Also, a candidate’s behavior may change depending on the audience. Colleagues can give insight into whether your prospect is respected by their peers. Clients will know best whether they can foster and maintain relationships with the customer base.  

When using a 360-degree evaluation it’s important to set a very clear rating scale. For instance, one person may require perfect performance to earn a five. Other raters may be more generous with their scores. The more specific you can be, the more reliable your ratings. 

#4. Look Beyond the Star Performers

Management comes with its own skillset. The company’s top performers may not have what it takes to lead. In fact, many top performers are promoted into roles they are incompetent for. This mismatch between skills is known as the Peter Principle. It’s important to control for this effect by promoting employees based on leadership ability — not their performance in their current role. Being a whiz in accounting doesn’t mean that employee can inspire and motivate others to perform.

#5. Assess Soft Skills

A lot of leadership qualities are difficult to measure. That‘s why many companies fall into the pitfall of promoting their star performers. Alternatively, they rely on data that is easily quantified, such as years of experience. But so-called “soft skills” — such as initiative, emotional intelligence, and time management — can better predict who will succeed in a leadership role. 

It’s likely you’ve been watching your potential hire for some time now. Whatever their role, leadership potential tends to assert itself. A few questions you can ask yourself (or their colleagues): 

• Does this person seek out additional responsibilities?
• Are they willing to do what it takes to get the job done (stay late, help out a colleague, etc.)?
• Does this person come to you with complaints? Or solutions?
• Do other employees see them as a guide and trusted resource they can turn to?

Beyond these basic questions, a number of tools have been developed to nail down those essential soft skills.

Mindtools is a free resource. They offer a number of online assessments including the aptly titled, “How Good Are Your Leadership Skills?” The initial assessment takes fewer than ten minutes and provides a detailed analysis of a candidate’s strengths and weaknesses. Articles, further assessments, and additional resources are suggested based on results.

Clifton34 is produced by Gallup, a global analytics firm. For US$ 49.99, it offers a complete talent profile for your candidates. Over 2 million high-achieving individuals were interviewed in order to identify 34 “talent themes”. It provides a more in-depth analysis than Mindtools, and access to more resources tailored to nurturing any identified strengths.

Self-assessment can be helpful too if delivered properly. An assessment that has candidates score themselves across traits may lead to nothing but 5s. Instead, try having the candidate rank their skills from strongest to weakest. You’ll get a better insight into what they believe their assets really are.

Spotting Leadership Potential in Your Employees

Every company needs to plan for leadership continuity. Assessing employees now and grooming them for management roles will ensure the company continues to grow and thrive. It’s important to look beyond the numbers to the soft-skills that predict a quality manager. A variety of assessment tools are available to help you choose the best candidate.