Identifying, Assessing and Selecting NextGen Leaders (2018)

11© Business Expert Press 978-1-94784-320-2 (2018) Expert Insights
www.businessexpertpress.com
Identifying, Assessing,
and Selecting NextGen Leaders
Sattar Bawany
“In today’s challenging economy and hypercompetitive
business environment, CEOs and senior executive teams
face enormous challenges to achieve and sustain break-
through operating results. The intensifying war for talent,
globalization, economic change, more stringent regulation
and tougher governance make realizing shareholder value
increasingly difficult. But the tougher challenge is identi-
fying, selecting and developing new leaders—critical for
developing the sustainable competitive advantage for the
organization and its eventual success.”
Prof. Sattar Bawany (2014b)
In“Managing Talent: Demystifying Board’s Role in Talent Management
in Talent Management Excellence Essentials.”no. 09.2014 Vo. 2 No. 09,
pp 18-19
Abstract: In most part of the world, shortage of lead-
ers and talent, in general, is evident. Organizations are
facing greater pressure to deploy future leaders faster
in response to the challenges ahead for business and
HR leaders in a dramatically changing digital, volatile,
uncertain, complex, and ambiguous (VUCA) business
landscape. In an age of disruption, business and HR lead-
ers are being pressed to rethink their current practices
in how they identify, assess and develop next-generation
(NextGen) leaders to ensure the sustainability of their
organizations.
How do organizations identify and select the next
generation of leaders? This article is designed to provide
insights and understanding of the best practices and con-
temporary approaches to talent assessment and selection of
high-potential talents or future leaders of the organization.
Keywords: High potentials, Leadership pipeline,
Next-Generation leaders, Talent assessment, Talent
identification, Talent management, Talent selection and
development, War for talent
Prof Sattar Bawany is the CEO of the
Centre for Executive Education (CEE).
He is also concurrently the Regional
Managing Director and C-Suite
Master Executive Coach of Executive
Development Associates (EDA) in Asia
Pacific. He is also the Adjunct Professor
of Leadership and member of the
Advisory Board of the Curtin Graduate
School of Business (CGSB) of Curtin
University, Australia.
Email: sattar.bawany@cee-global.com
Website: www.cee-global.com
LinkedIn: www.linkedin.com/in/
bawany

© Business Expert Press 978-1-94784-320-2 (2018) Expert Insights
Identifying, Assessing, and Selecting NextGen Leaders
2
Introduction
Today’s dramatically changing work
environment demands that organizations
have to continuously ensure that there is
a robust leadership pipeline ready to be
deployed now and in the future. Identi-
fying, assessing, selecting, and develop-
ing the next-generation or potential future
leaders are, therefore, critical strategic
objectives for ensuring a sustainable, com-
petitive organization. The business case for
doing so is clear as supported by extensive
published research. In the first 18 months
of ascending to leadership positions, 30
to 70 percent of leaders fail (Hogan 2011).
These failures cost organizations substan-
tial time and resources, with estimates
ranging from $750,000 to over $2.5 million
to replace senior leaders, and the estimated
cost of replacing a CEO is an astounding
$12 million to $52 million (Stoddard and
Wyckoff 2009). Equally important indirect
costs are associated with leader failure,
including increased employee stress and
decreased engagement (Schippmann 2010).
Today’s businesses face unprecedented
challenges operating in a global envi-
ronment that is increasingly becoming
volatile, uncertain, complex, and ambigu-
ous (VUCA). Leaders are also confronted
with increased competition, globalization,
demand for growing social responsibili-
ties, and a stream of technological revolu-
tion causing disruption in the marketplace.
Hence organizations need to strengthen
their leadership bench strength and also
ensure the availability of leaders today
and tomorrow to take on the responsi-
bility to ensure the sustainability of the
organization.
In essence, the heart of the leadership
challenge that confronts today’s leaders
is also applicable to next generation of
leaders who will be expected to lead in
situations of ever greater volatility and
uncertainty in a globalized business envi-
ronment, allied with the needs to deal with
scale, complexity, and new organizational
forms that often break with the traditional
organizational models and structures
within which many have learned their
“leadership trade” (Bawany 2015).
One of the challenges of identifying
high-potential individuals is the inherent
complexity of making predictions about
how successful a person might be in the
long-term future. It involves defining
what you are trying to predict, assessing
a person against the appropriate criteria,
and making predictions about future per-
formance. A wide range of issues needs
to be considered, including the person’s
capabilities and motivations and the chal-
lenges and opportunities associated with
future positions in the organization. This
is different from a selection decision
where there is a clear understanding of
the specific job requirements for the posi-
tion to be filled.
NextGen Leadership Pipeline
Leading in a world that is highly disruptive
as well as VUCA not only provides a chal-
lenging environment for leaders to operate
and for executive development programs
to have an impact: it also provides a much
needed range of new competencies. The
new reality is resulting in the realization
that new and different capabilities are
needed to succeed (Bawany 2018).
Leading organizations continuously
asked where their future or next genera-
tion (NextGen) of leaders will come from.
It would seem that the same approach has
been implemented for a long time, which
includes identifying high-potential talents
within the workforce and provide them
with the relevant leadership development
opportunities so as to equip them with
critical leadership skills and competencies
that would be required to drive the orga-
nization strategy (Bawany, 2014b). Given
the daunting challenges that these future
leaders will have to resolve, which are to
result from the ongoing highly disruptive
and VUCA-driven environment, there is
a need for organizations to continuously
reassess their approach toward ensuring

3
the development of the right set of skills
and competencies for their NextGen lead-
ers (Bawany, 2017).
One of the most important, yet misun-
derstood, questions within talent manage-
ment is how to successfully identify and
manage high-potential employees—those
talented few who can and will step up and
deliver in bigger, broader roles. Smart busi-
nesses know how to take full advantage of
their talent by identifying those who have
the highest potential. This ability to iden-
tify the elusive “potential” in an employee
is considered a key competitive advantage
(Silzer and Dowell 2010).
According to the Corporate Leadership
Council (2010), most companies believe that
their high-potential employees are more
than50percentvaluablethananaverageem-
ployee. Not surprisingly, over three-quarters
indicate that high-potential identification
is an immediate/short-term priority. The
investment in high potentials has also
increased, with 80 percent of companies
claiming to have spent more dollars than
ever before on this group. And the appeal is
clear on the other side as well—promising
talent is attracted to companies known for
having strong development resources and
opportunities (Fernández-Aráoz, Groysberg,
and Nohria 2011).
Talent management represents an orga-
nization’s efforts to attract, develop, and
retain skilled and valuable employees. Its
goal is to have people with the capabilities
and commitment needed for current and
future organizational success. An organiza-
tion’s talent pool, particularly its managerial
talent, is often referred to as the leadership
pipeline (Conger and Fulmer 2003).
Developing the next generation of
leaders involves building a sustainable
leadership pipeline for the organization.
Ram Charan introduced the image of a
leadership “pipeline” (see Figure 1) and
asserts that, if whatever is flowing through
it gets stuck, the pipeline will not deliver
the resource it contains (Charan, Drotter,
Figure 1: The Leadership Pipeline Framework

4
and Noel 2000). Where the pipeline shifts
direction, things can easily get stuck. It
is the task of managers who lead to help
those who get stuck to move on (up or out)
and make room for others.
Who Are the NextGen Leaders?
Broadly speaking, next-generation or future
leaders are primarily the high potentials
of the organization. High-potential tal-
ent is often viewed as an employee who
is assessed as having the ability, organiza-
tional commitment, align to the organiza-
tion’s values and have demonstrated the
competencies and skills as well as the moti-
vation to rise to and succeed in more senior
positions in the organization. Each organi-
zation will have their own definitions of
high-potential talent, but in essence, the
process and criteria for assessment and
identification of high potentials are quite
similar between organizations.
A robust leadership pipeline is critical
to driving strategy and growth so organiza-
tions may achieve their goals. But, while
many organizations have devoted consider-
able resources to the development of these
next-generation or future leaders, few have
a readily available pool of these leaders who
are ready to take on greater responsibilities
and to meet the daunting challenges of the
future. While the severity of the issue var-
ies among organizations and industries, it’s
clear throughout the business world that the
demand for these future leaders is greater
than supply and as a result, many organi-
zations face a shortage of leadership talent.
The complexity and fast-changing nature
of the hypercompetitive global economy
have created the demand for new lead-
ership mindsets, skills, and capabilities.
With the failure of leadership development
programs to develop people fast enough to
fill the new and changing roles required for
success, many organizations are in a pre-
dicament and their long-term sustainabil-
ity is in question.
Having a robust leadership pipeline remains
as one of the critical talent management
issues facing organizations around the world
operating in a VUCA business environment
as this would contribute toward the develop-
ment of a sustainable competitive advantage
of the organization. This is achieved by
identifying and cultivating emerging tal-
ent early while enhancing organizational
capability. Developing a leadership pipeline
starts with identifying and then transform-
ing high-potential individuals to a variety of
developmental opportunities and experiences
(Bawany 2014a).
Organizations are facing unprecedented
new leadership challenges, including
developing different generations of lead-
ers likely to be from Gen Y or Millennials,
meeting the demand for leaders with global
fluency and flexibility, building the ability
to innovate and inspire others to perform,
and acquiring new levels of understanding
of rapidly changing and emerging tech-
nologies and new disciplines and fields. As
experienced leaders, managers, and profes-
sionals continue to leave an organization,
their intellectual capital and tacit knowl-
edge, unless codified, will be lost, creat-
ing tremendous challenges at a time when
the market is growing more global and
dynamic. This translates to tougher com-
petition in the marketplace, making the
search for high-potential people externally
more difficult and future success more elu-
sive. Further, there is a sense of urgency
for organizations today to accelerate the
time to competence compounds the chal-
lenge of building a strong leadership pipe-
line from within (Bawany 2018).
The leadership development training
programs may be strengthened, broad-
ened, and deepened to include inspiring
and engaging others, as well as cognitive
readiness skills and emotional and social
intelligence competencies. These capa-
bilities can be addressed by incorporating
specific activities and exercises designed
to increase awareness of their impact and
importance in familiar techniques, such
as case studies or applicable business
simulations.

5
Additionally, opportunities for appli-
cation and practice can be provided in
experience-based approaches where par-
ticipants work to apply the concepts and
skills directly to real business issues, while
colleagues and facilitators provide feedback
based on behaviors they observed during
their work together.
We are operating in a hypercompetitive
VUCA business environment. The world
moves faster today when compared to 20
years ago. Companies feel the pressure
to decrease time to market and improve
the quality of products while delivering
on ever-changing customer expectations
to maintain competitive posture—that is,
be adaptive and nimble. Driving results in
high-performance organizations (HPOs) is
difficult even for companies that have the
benefit of dedicated and knowledgeable
employees and business leaders to lever-
age (Bawany 2018).
From ongoing research by the **Centre
for Executive Education (CEE), it has been
identified that various next-generation
leadership competencies such as cognitive
readiness (critical and strategic thinking
skills), emotional and social intelligence,
managerial coaching and leading team for
performance, effective negotiation and
conflict management, and cross-cultural
communication and diversity management
are crucial to driving results and achieving
organizational success in an HPO oper-
ating in a highly disruptive and increas-
ingly VUCA-driven business environment
(Bawany 2016).
Identification and Assessment
of NextGen Leaders (High
Potentials)
In recent years, the use of formal assess-
ment efforts has broadened both within and
across organizations (Scott and Reynolds
2010). The increasing emphasis on the war
for talent, first identified in the early 2000s
(Michaels, Handfield-Jones, and Axelrod
2001), has raised awareness levels and
concern over an organization’s ability to fill
future gaps in the leadership pipeline. This,
in turn, has led to an increasing emphasis
and focus on talent management strategies
and frameworks in organizations (Cappelli
2008) including the creation of new job
titles, dedicated roles, and entire functions
dedicated to this area of focus. It has also
led to a heightened focus on high-potential
identification in corporations (e.g., Camp-
bell and Smith 2010). In particular, there
is an increasing emphasis on finding the
most effective assessment method or tool
that will identify future leaders with the
greatest potential for enhanced develop-
ment and succession.
Many organizations recognize that
assessment, selection, and development
procedures for their people are of para-
mount importance in order to achieve a
sustainable competitive advantage. Increas-
ingly, they are turning to the Assessment
Centre approach, which, when carefully
constructed and well run, can provide a
number of benefits to an organization seek-
ing to improve its approach to the selection
and development of their talent, which in
turn can identify and predict key behav-
iors in the workplace that transform future
leaders. These benefits may include but
are not limited to:
■■ Reduction in turnover and subsequent
recruitment costs (as the most appropri-
ate individual is selected for the leader-
ship role)
■■ Identification of high-potential talent
within an organization
■■ Identification of individual strengths
■■ Identification of individual development
needs
■■ Identification of crucial “skills gaps” to
drive the organization forward
■■ Provision of a robust process for restruc-
turing of the organization if needed
■■ Provision of relevant and credible infor-
mation for Succession Planning
■■ Production of a detailed Talent Audit within
the whole organization

6
The purpose of an Assessment Centre
(AC) is to obtain the best possible indica-
tion of a person’s actual or potential capa-
bility to perform in the target job or level of
responsibility. The AC is designed to focus
on the systematic and objective identifica-
tion of behaviors of an individual for the
purposes of selection, placement, promo-
tion, development, career management,
succession planning, and training. The AC
method is now regarded as one of the most
accurate and valid assessment procedures
and is used globally for both selection and
development.
Leveraging on an Assessment Centre
It is difficult to provide an exact defini-
tion of an AC, since the content may differ
widely depending on the objectives of the
program for each organization. In general,
however, an AC involves the standardized
evaluation of behaviors and the follow-
ing key factors should be included in the
process:
Assessments Are Behaviourally Based
The primary purpose of an Assessment
Center is the evaluation of the performance
of participants against a pre-identified set
of competencies or criteria. These compe-
tencies or criteria can be identified by car-
rying out a thorough job analysis of the role
in question (whether the job is an exist-
ing one or a new position). These criteria
should incorporate the participant’s knowl-
edge, ability, personality, and personal
motivation. This will enable the identifi-
cation of those behaviors that differentiate
successful from the less successful perfor-
mance. It is also important at this stage to
ensure the context in which the behaviors
take place is understood, together with the
level of complexity of the problems likely
to be encountered by the jobholder.
Several Candidates or Participants
Are Observed Together
This allows interaction between partici-
pants, both in the actual exercises and
less formally, ensuring that the program
is more interactive as well as more eco-
nomical. With the increasing advances in
technology, these groups can not only be
formed physically but also in the form of,
for example, a Virtual Assessment Center.
While there are no hard and fast rules on
the numbers of participants to be involved
in each center, the practical considerations
for the design of the center usually require
multiples of four or six participants.
Assessment Is via a Combination of Methods
A key factor in the design of a center is the
inclusion of at least two work sample sim-
ulations that replicate, so far as possible,
the key challenges of the job in question.
These simulation exercises will typically be
used in combination with other assessment
techniques to ensure comprehensive cover-
age of attributes and skills and to increase
the reliability of measurement. Two impor-
tant factors to bear in mind when selecting
appropriate assessment methods are:
(i) Do they capture the different situational
contexts of the job?
(ii) Do they provide the opportunity for
the accurate assessment of the range
of skills and competencies required to
perform the job?
When designing the center program, and
selecting the assessment methods to use,
it is important to ensure that there are at
least two measures for every competency
to be assessed.
Multiple Assessors/Observers
The involvement of a number of assessors
increases both objectivity and impartiality.
A key factor in the use of multiple assessors
is that the timetable should be designed in
such a way as to allow for their rotation so
that, ideally, a range of assessors observes
each participant. The assessors can be
taken from a range of personnel special-
ists, line managers, and psychologists. All
should be fully trained in the behavioral

7
assessment process and in its application
to the particular exercises being used in the
center.
Integration of Data
An integration session provides a fair and
objective review of all the evidence gath-
ered and aims to gain consensus among
the assessors. The aim is to focus on the
participant’s overall performance against
the competency model and to identify a
pattern or profile of strengths and devel-
opment needs of each individual. When
used for selection, no decision should
be taken until all the evidence has been
shared and a final rating agreed upon. This
session should be used to gather informa-
tion to provide feedback to the participant
on their strengths and potential develop-
ment areas, and the participant may even
be given some feedback during the center.
Ideally, no one assessor should have all the
data on a single participant until the inte-
gration session.
Lessons Learned from Derailment
of High-Potential Identification
It would be prudent to learn from mistakes
other organizations made in identifying
candidates that were eventually proven
not to succeed in future leadership roles.
Interestingly, most managers will nomi-
nate high performers who are not actually
high potentials based on past performance
only, but not validate the selection with
some form of observational or psycho-
metric assessment or through an AC as
described in an earlier section. These man-
agers mistakenly assume that high per-
formers are automatically high potentials.
There have been extensively published
research that clearly supports that this is
not the case, when in fact only 20 percent
or less of high-performing employees are
also high potential (Ready, Conger, and
Hill 2010). A manager may be a high per-
former at their current level but struggle
with a higher-level business leadership role
due to increased demands and capabilities
required to succeed in those roles. Second,
after implementing a high-potential pro-
gram in the company, there is no organi-
zational system or processes to develop,
rotate, or deploy candidates to help them
gain the right experience so that they can
prepare themselves for their next role.
Leading organizations develop their
high-potential leaders best through
job-based exposure and stretch experi-
ences, so the organization must have a
well-defined process to support these activ-
ities. For those high-potential leaders who
are not managed under a structured devel-
opment process, many or most lose faith
in the company providing for their career
and they may leave the company to pur-
sue their careers with another firm. On the
hand, there are many instances that many
or most of these high potentials stay with
their current companies when they can
see their future aligned with the company’s
future.
Often managers and executives confuse
assessing an individual’s current skills and
abilities with the person’s potential, just as
they confuse past performance with future
effectiveness. Current skills and abilities
are different from potential and need to be
considered separately. Accurately assess-
ing a person’s current knowledge, skills,
and abilities is an important first step, but
it should not be confused with determin-
ing the person’s ability to grow, adapt, and
develop enough to handle more complex
future work challenges and responsibili-
ties. Unfortunately, this difference is not
typically recognized or discussed in most
organizations, even when they understand
the difference between past performance
and future effectiveness. This may be due
to a poor understanding of the difference
but also to a poor definition and measure-
ment of potential.
Unfortunately, the judgment about an
employee’s future potential is often left to
a hasty discussion at the end of a long suc-
cession planning meeting, and the decision
is frequently made by few or even a single

8
senior executive. Few organizations have
specifically defined what they mean by
potential or how an individual employee’s
potential differs from past performance or
current abilities and skills. Even when po-
tential is clearly defined, the judgment can
be difficult. How do you evaluate a person’s
ability to grow and develop in the future?
Making predictions about the future is more
complex than assessing a person’s current
skills and abilities. It may be similar to
predicting progress on other development
variables (Silzer and Church 2010).
In 2009, Executive Development Associ-
ates, Inc. (EDA) embarked on a research
and published the findings of the study on
the identification of high-potential leader-
ship talent. The respondents were asked to
address the factors they consider to iden-
tify high-potential leadership talent (Hage-
mann and Bolt 2009). The following factors
as listed in Table 1 rated the highest:
Table 1: Factors in Identifying of High Potentials
Factors for
Identification of
High-Potential
Talent Explanation/Description
1. Strong track record
of performance,
proven results, and
success in past or
current roles
Executives said they look at how successfully candidates perform their various
job duties individually and compared to their peers. For instance, one executive
said she looks for successful people in their current roles; another looks at
job performance, and a third stressed standing out above the rest. One executive
asks,“What kind of results are they getting? Did they go beyond what was
initially laid out, and did they complete the project?”
2. Strong
interpersonal skills
Understanding the people-side of business. Interpersonal skills were described
as softer skills and included the ability to interact with diverse individuals;
to recognize how actions will affect themselves, others, and the business; to
understand the people-side of the business, and to express empathy. When
describing individuals who have strong interpersonal skills, one executive
says he looks for people who are not all about themselves. One executive asks
himself:“How do they achieve results? How do they work with people to get the
work done?”
3. Strong
communication
skills
Strong communication skills include excellent verbal and written
communication. Excellent verbal and written communication and clear, concise
communication at all levels were emphasized repeatedly as key predictors of
future success. One executive identified high potentials by their ability to give
presentations and how well they communicate and handle conflict. For many,
the ability to communicate with their team was critical.
4. Drive, initiative, or
an ambition to an
increased level of
responsibility or
readily accept new
challenges
High potentials were described as hungry individuals who are self-driven
and not expecting the company to take them in any certain direction. Always
thinking of a better mousetrap, these individuals are spotted by their initiative,
persistence, and drive—their work ethic. One executive searches for individuals
who are always unsatisfied with the status quo—looking to change what needs
changing. One of the role-model leaders asks himself,“Does the individual have
an interest and desire to learn more and to take on more responsibilities?”
5. An ability to create
and articulate
company vision
and strategy; set
direction, execute
objectives, and
understand the
total business
Not only was it important to understand the company vision and strategy, but
it is also important to look for individuals who are vision-setters, meaning they
have a vision, share the vision, execute it, and get others to buy into it. In other
words, they cast a vision for people to follow. One of the executives mentioned
that high potentials should have no fear of personalizing the strategy and vision
or of seeking input from subordinates because that is often what it takes to
understand the dynamic(s) across the organization, and to have a clear point of
view in understanding the (total) business and the context it is in.

9
Competency-Based Selection
of NextGen Leaders (High Potentials)
The work of David McClelland (1973) set
the stage for the widespread growth of com-
petencies. McClelland argued that aptitude
tests, almost universally used to predict
performance, do not serve their intended
purpose well and are prone to cultural
biases. Also, he argued that other traditional
measures, such as examination results and
references, are equally poor at predicting
job success. Instead, McClelland suggested
that individual competence might provide
a more promising alternative for predicting
performance. He described competencies
as representing groups of behaviors under-
lying individual characteristics that enable
superior job performance.
The 1980s witnessed a growth in using
competencies to identify and predict lead-
ership effectiveness and long-term success
(Boyatzis 1982; McClelland and Boyatzis
1982). These applications led to the devel-
opment of leadership competency mod-
els and competency-based selection
tools, such as behavioral event interviews
(Boyatzis 1994; McClelland 1998). Compe-
tencies also provide a structure for linking
performance with cognitive ability and per-
sonality, coaching employees to overcome
dysfunctional behavior (Boyatzis 2006),
and selecting and developing high-potential
employees (McClelland 1994).
Managers are required to ensure that
organizations achieve their objectives.
Managerial competencies are defined as
sets of knowledge, skills, behaviors, and
attitudes that a person needs in order to
be effective in a wide range of managerial
jobs and various types of organizations.
Organizations applying several managerial
competencies, which drowses attention
to the need to understand how different
these competencies are working in orga-
nizations, therefore require to highlight
the most effective competency in order to
enhance it for a good performance.
Competency is an important concept
in organization management since it is
closely related to excellent work perfor-
mance. Individual competencies are one
of the factors that determine the effective-
ness of organization performance. Mana-
gerial competency models located in the
literature capture business skills, intraper-
sonal skills, interpersonal skills, and lead-
ership skills as important competencies for
effective performance. Managerial compe-
tence is the ability of managers and leaders
to direct work streams and define outcomes
clearly. Identifying the requisite compe-
tencies for achieving an occupational field
is a critical process in management, where
the task of identifying qualities defines the
efficiency of managers. Competency often
means “a fairly deep and enduring part of a
person’s personality” (Alec Levenson 2011).
Competent managers have been required
by the organizations from the early 1950s
(Boyatzis 1982). Managers are required to
ensure that organizations achieve their
objectives. Many researchers over a period
of time have tried to identify and establish
competencies that are required for mana-
gerial effectiveness leading to superior
performance. Managers may thus be seen
as seeking to give, take, and manage to
mean through work and the organization.
Boyatzis (1982) defines managerial com-
petencies as characteristics that are caus-
ally related to effective and/or superior
job performance. Organizations applying
several managerial competencies, which
drowses attention to the need to under-
stand how different these competencies
are working in organizations, require to
highlight the most effective competency in
order to enhance it for a good performance.
Boyatzis (2008) also analyzed managerial
competencies and defined competencies
as an underlying characteristic of a person
that could be a motive, trait, skill, aspect
of one’s self-image, social role, or a body of
knowledge that he or she uses. These char-
acteristics are revealed in observable and
identifiable patterns of behavior, related
to job performance and usually include
knowledge, skill, and abilities.

10
NextGen Leadership Competencies
As shown in Figure 2, the five pillars of
next-generation leadership competencies
operating in a VUCA world includes emo-
tional and social intelligence and cognitive
readiness (critical and strategic thinking
skills amongtst others (Bawany 2018).
Emotional and Social Intelligence
Competencies
In 1998, in Working with Emotional
Intelligence, author Daniel Goleman set out
a framework of emotional intelligence (EI)
that reflects how an individual’s potential
for mastering the skills of Self-Awareness,
Self-Management, Social Awareness, and
Relationship Management translates into
on-the-job success for a leader. This model
is based on EI competencies that have been
identified in extensive published research
on hundreds of corporations and organi-
zations as distinguishing outstanding per-
formers (Goleman 1998).
An emotional competence is defined
as “a learned capability based on EI that
results in outstanding performance at
work” (Goleman 1998). To be adept at an
emotional competence like Customer
Service or Conflict Management requires
an underlying ability in EI fundamen-
tals, specifically, Social Awareness and
Relationship Management. However, emo-
tional competencies are learned abilities:
having social awareness or skill at man-
aging relationship does not guarantee we
have mastered the additional learning
required to handle a customer adeptly or to
resolve a conflict—just that a leader has the
potential to become skilled at these compe-
tencies (Goleman 1995).
Emotional competencies are job skills
that can, and indeed must, be learned.
An underlying EI ability is necessary,
though not sufficient, to manifest compe-
tence in any one of the four EI domains,
or clusters,
Figure 2: The NextGen Leadership Competencies for HPO

11
Cognitive Readiness Competencies
The next-generation leadership compe-
tencies will include a suite of cognitive
readiness skills, which can be viewed as
part of the advanced thinking skills that
make leaders ready to confront what-
ever new and complex problems they
might face. As stated earlier, cognitive
readiness is the mental preparation that
leaders develop so that they, and their
teams, are prepared to face the ongoing
dynamic, ill-defined, and unpredict-
able challenges in the highly disruptive
and VUCA-driven business environment
(Bawany 2018).
The EDA has identified the following seven
key cognitive readiness skills collectively
known as Paragon 7 (see Figure 3), which
develop, enhance, or sustain a leader’s ability
to navigate successfully in this “new normal”:
1. Mental Cognition: Recognize and regu-
late your thoughts and emotions.
2. Attentional Control: Manage and focus
your attention.
3. Sensemaking: Connect the dots and see
the bigger picture.
4. Intuition: Check your gut, but don’t let
it rule your mind.
5. Problem Solving: Use analytical and
creative methods to resolve a challenge.
6. Adaptability: Be willing and able to
change, with shifting conditions.
7. Communication: Inspire others to action;
create fluid communication pathways.
Figure 3: Paragon7 Cognitive Readiness Competencies

12
Overall, heightened cognitive readiness
allows leaders to maintain a better sense of
self-control in stressful situations.
Beyond Competencies: Measuring
Success of High Potentials
Leadership competencies are the most fre-
quently assessed criteria for high potentials
and senior leaders. Competencies have
become fully embedded in the language
and practice of leadership assessment,
selection, and development, and they also
help drive business strategy, but they are
not the only way to measure leadership
effectiveness.
Some organizations believe that com-
petencies are not the most appropriate
target for leadership assessments and that
organizations would be better served to
define leadership effectiveness based on
expected outcomes rather than on profi-
ciency in a set of competencies. People
with many different styles and skills
can achieve excellence in leadership;
therefore, organizations should select
and develop leaders for overall compe-
tence, not just based on a list of attributes
(Hollenbeck and McCall 2001).
Morgan W. McCall of the University of
Southern California has defined a set of
five leadership demands that can serve as
the basis for evaluating leadership com-
petence (see Table 2). These leadership
demands are drawn from successful lead-
ers and reflect hundreds of descriptions
of experiences and thousands of lessons
learned (McCall 2010). Assessing a leader
based on how well he or she meets these
five demands avoids the search for a single
style, personality, or set of competencies
common to all leaders.
Conclusion
The field of identifying and assessing
high-potential talent in organizations is
evolving. Based on the challenges as iden-
tified through various research and stated
earlier in this article, we believe several
key issues in the area need to be addressed
in the future in order to advance the field.
There is certainly room to do better in
terms of identifying high potentials. The
greatest opportunity for improvement
starts with having a clear definition of
potential, followed by a systematic assess-
ment of those nominated for inclusion in
the high-potential pool. Increasingly lead-
ing companies use the competency-based
talent review process to select and align on
high potentials.
Table 2: McCall’s Five Leadership Demands
1. Set and communicate direction: Establish and communicate the purpose, vision, and
mission of your part of the organization. Create an
architecture and set of processes that will drive that
vision.
2. Align critical constituencies. Make sure that the people and groups necessary to
achieve the mission understand it and are aligned
with it, and that those who are obstacles to the
mission are dealt with.
3. Demonstrate an executive temperament. Show the ability and confidence necessary to cope
effectively with the pressures and ambiguity of a
leadership role.
4. Set and live your values. Convey and reinforce what the organization—and you
as a leader and person—believe in and stand for.
5. Grow and learn. Take the necessary steps to ensure that you and your
people continue to learn, grow and change.

13
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