Being in the IT industry for 30 years in different setups like large Blue Chips, start ups and investor backed companies, I have experienced environments with great performance, turn around situations, growth cases and saturated organizations. People who have made a difference to the organization, the culture and the performance have very different backgrounds, potential and experience. They are not always the ones with best assessment for potential. 

Hiring for potential from my point of view is not making a company great. It potentially gets people who have passed assessments best in decision making positions but they may lack four things to be successful: values, empathy, experience and the ability to communicate. Rarely the assessments on hiring for potential get these leadership competencies all right.

A company that needs better processes and implement software platforms to run its processes smarter, more digital and efficient, hires a Change Manager or CIO. The best potential will not help to drive this change if the experience is lacking on how to implement end to end processes best in class and avoid major software implementation mistakes. It requires a good education and practical long term experience to transform processes and implement those otherwise the company spends a fortune on failed projects and will loose competitiveness. For sure you need people who can think as well strategically on those positions as well but without experience and deep knowledge it will be a no starter.

If you have a team of people who are not performing well in a market that is growing, it requires quite some market skills, people and operational skills to turn this team into a high performing team. Just potential in leadership would not be good enough. Some parts require a deep understanding of market dynamics, some require empathy  and communication skills to give the team purpose and a setup that actually gets to operational efficiency and best in class performance.

I have seen people with great skills, empathy and awesome results who would not been hired based on an assessment where perceived potential would be measured only. What a shortfall for the company to let this talents go.

Don't get me wrong you need potential on your team, people will learn a lot on the job and gain experience. that is why we have young talents and mentorships. But a great team is not hired on the drawing board. A great team has diversity in skills, experience and capabilities. Focussing on just one part will make you fall short.

When I started my career at IBM, we were trained after our university degree for one year. 26 weeks of training to have a toolset from technical, conceptual, customer facing skills before we were allowed to see a customer. Even after this one year, we all needed to gain experience to provide real value to customers. It is not different when you hire managers for potential not having the toolset and experience to succeed.

Hiring for the following competencies and capabilities and create a diverse team:

• Values
  
• Potential
  
• Empathy
  
• Experience
  
• Communication skills
  

to achieve the best results for your company. A team of high potentials which is incapable to work together or not able to communicate purpose won't help and it gets worse if you have no industry skills on the team. 

The mix of skills makes the success happen including diversity in gender, culture, age and orientation. Potential is only a part of what you need to succeed. If people with great potential have gained the experience and demonstrated empathy, values and reach the team through good communication, they may become leaders at a later stage.