2025 Potential Report
THANK YOU
We’re only able to produce high quality research like the 2025 Potential Report through your support. We wanted this survey to be the largest ever research project on potential and you made that possible!
To everyone who completed the survey – which was our longest ever in our 15 years of research – thank you! Your transparently sharing data provided a research base that allowed us to produce this very thorough report.
Thank you to those who sent notes and posts that encouraged participation including David Murray at Confirm, JP Elliott at Future of HR, Glen Kallas at Camden Delta, Manuela Morelli of Talentum Consulting, Brian Heger at Talent Edge Weekly, Angela Lane, Derrick Pauly and other that I may have missed. And thank you to the many people who re-shared our posts to their networks!
I have always believed that our HR community can produce great results when we support each other. This report is an example of that “by us, for us” mindset at work.
Thanks again and enjoy the report!
Sincerely,
Marc Effron, President
About the Report
The 2025 Potential Report provides a comprehensive view of how organizations worldwide are identifying, managing and developing their higher potential employees. This research continues our recent research theme into organizations’ top talent including our High Performer/High Potential Development Report and Critical Roles Report.
Why this Topic Area
The accurate prediction of how far and how fast individual’s can advance at work (potential) is incredibly valuable but remains a significant challenge. If we can increase this accuracy, we can reduce turnover risk in critical roles. We can ensure successors are available for key talent. We can reduce waste in our leadership development investments.
Our consulting and teaching experience shows massive variation in practice and the use of unproven methodologies in the potential identification process. This primarily results in Type 1 error (individuals being incorrectly identified as high potential) but there’s increasing recognition in a talent-scarce world that Type 2 error is also occurring (not identifying individuals who could successfully move upward in their organization).
In this Report
We provide insights into the processes used, definitions, tools, assessments, communications approaches and more. We thank the more than 300 companies worldwide that participated.
This report is intended to share information about how practices around potential are being applied today. It is not a “best practices” report or a benchmarking guide and should not be used that way. We encourage you to use the commentary to help guide your interpretation of the statistics presented.
As with all Talent Strategy Group research, we present objective findings based on a non-biased list of survey items. Our report does not include the social commentary or projected personal points of view that seem to seep into many firms’ reports.
We appreciate your interest in our research. We hope to serve your organization in the future.
The Talent Strategy Group
Report Highlights
There are surprising strengths and familiar weaknesses in the 2025 Potential Report. In what we believe is the most comprehensive survey ever of potential assessment and management, you shared that you use accurate assessment criteria, traditional charting tools and care little about building assessment capability or communicating potential status.
Some of the key findings you’ll read more about include:
Most companies assess for potential; those who don’t plan to: This is a near-ubiquitous process in the more than 300 companies surveyed. Most of those not yet assessing potential were smaller organizations.
Generally clear, science-based markers of potential: Assessment of the 70+ potential models submitted show that many used elements that are science-proven predictors of upward potential, including measures of ability, ambition, and agility. We don’t know how effectively individuals are being assessed against those predictors (although the stats below suggest not very well).
The 9-box still rules: The reported death of the 9-box grid has been greatly exaggerated. This tool emerges as the overwhelmingly favorite way for organizations to chart potential in their assessment process.
Little use of standardized assessments: Cognitive and personality assessments are used by a small minority of organizations to assist in the potential identification process. Fortunately, we didn’t find that organizations use any of the invalid tools that remain a favorite in select HR shops.
Low transparency continues: A small downward shift occurred since we last asked this survey question with even fewer companies now sharing when someone is or no longer is a high potential leader.
No commitment to capability-building: Very few companies have mandatory training for leaders in how to accurately assess potential. The low numbers on this item may be linked to the low potential prediction accuracy rate reported below.
Organizations rate their potential assessment process as largely ineffective: As evaluated either by their reported rate of being correct when predicting potential (44%) or by the percent of organizations saying they agree or strongly agree that their potential assessment process is effective (36%), there is a significant gap in organizations’ ability to accurately predict potential.
Process over Progress; Effort over Outcomes
Our 2025 Potential Report findings mirror the themes from our 2025 Critical Roles Report and our 2024 High Performer/High Potential Development Report. The HR community is making smart choices on process design. We see few obvious errors in the mechanics of how potential assessment is designed.
The gaps are in process enablement. There’s not training in how to accurately assess potential. There’s not accountability to have development plans for high potentials. There’s not transparency to tell someone that they are designated as, or no longer designated as, someone who can move far and fast in the organization.
The consistency of these themes across our research is disturbing and serves to undercut any potential gains that our profession may make in other areas. The “right” answer means nothing if it’s not implemented. What you have told us through your data over the past few years is that you are making smart choices, but that you are unable to leverage those smart choices to produce the expected results.
Going Forward
We challenge the HR practitioners reading this report to identify the weak implementation links in your practices for assessing and managing higher potential leaders. Ask yourselves, “What are the two largest reasons our organization is not accurately predicting potential or effectively managing those with higher potential?” Make solving those issues the number one and two priorities on your talent management strategy for next year.