Assessing employee potential is one of the most important processes a manager can master. Before sending someone to a course or training session, you need to know whether that person has the skills and mindset necessary to grow—otherwise, the investment in development risks going in the wrong direction. The stakes are high: according to Gallup research, companies select the candidate with the right talent for the role in only about 18% of cases—meaning they get it wrong in the remaining 82%, especially for leadership positions. This article offers four concrete guidelines to help you identify the right people on your team, starting with a story you’ll recognize.
Table of Contents
- A Story About Leadership and Investment
- Focus on your mindset, not just on the activity
- Invest in people with potential who are eager to learn
- Look for areas of risk as well, not just talent
- Add an external sensor
- Frequently Asked Questions
A Story About Leadership and Investment
Two teams made up of managers from the same company competed in a rowing race to see which was more efficient. The “green” team consisted of logistics managers, while the “red” team consisted of research managers. Both teams invested in equipment and trained intensively, but the logistics team won.
Demoralized, the “red” team formed an investigative committee. The conclusion: the logistics team had 7 rowers and only one coxswain to steer the boat, while the research team had 7 coxswains and only one rower. The advice they received was to reorganize the roles—so the following year, the “red” team set out with four executive coxswains, three assistant coxswains, and, once again, just one rower. He was given performance bonuses, coaching, and personalized pens: “We need to give him more confidence,” the managers said. The result? Logistics won again, by an even wider margin. Humiliated, the “red” team fired the rower for poor performance and stopped investing in a better canoe.
The story is intentionally taken to the extreme. Its message: without assessing employees’ potential, even the best intentions to develop people can produce exactly the opposite result. It doesn’t matter how much you invest if you don’t know where to put the money—you’ll end up rewarding the rower instead of asking why the rest of the team isn’t rowing at all.
Before you invest in someone’s development, the question isn’t “How much should I give?” but “Who can truly grow, and in what direction?”
Focus on your mindset, not just on the activity
How many times have you sent people to a training session without seeing any results afterward? Most of the time, the problem isn’t the course itself, but the mindset with which a person approaches it—you can’t build something new on the basis of a closed mindset. This is where the assessment of employee potential begins: not just in terms of technical skills, but in how a person responds to challenges and new information.
There is a clear difference between someone who says, “I don’t know, but I want to find out,” and someone who says, “I’ve learned enough.” Research by Stanford psychologist Carol Dweck on the growth mindset shows that people who believe their abilities can be developed through effort and feedback achieve better results in challenging environments than those with a fixed mindset. A good evaluation includes precisely this indicator: openness to learning, which often either undermines or supports everything else.
Invest in people with potential who are eager to learn
The logistics managers in the story applied a simple principle: the right person in the right place, clear roles, and a commitment to results—without a cumbersome hierarchy or bonuses “thrown to the wind.” Employee potential assessment is the tool that makes this match possible, looking beyond resumes and years of experience.
Based on our experience—having organized over 100 assessment centers—we’ve noticed that experience alone is no longer such a relevant criterion today; what really matters is growth potential. Focus training on people who have potential and are eager to learn, rather than pouring resources into those who set limits for themselves. Some employees, no matter how many opportunities they’re given, remain stagnant—not because they’re incapable, but because they don’t want to step outside their comfort zone. Assessing employee potential highlights this difference without judgment and without wasting resources. Smart investments in people aren’t based on seniority or personal preference, but on data about who can grow and under what conditions.
Look for areas of risk as well, not just talent
As managers, we often see our team only in a positive light and overlook the risks. An evaluation isn’t complete if it focuses only on strengths and ignores areas of vulnerability. Understand each person’s areas of risk and what they still need to improve—often, true potential lies precisely in how well these areas can be managed. This is precisely the argument behind the Gallup figure: if the wrong choice is made in 82% of cases, a manager’s intuition is not enough, and a rigorous assessment of potential becomes a necessary tool.
When you identify a risk area, don’t use it as grounds for immediate termination, but rather as a starting point for a personalized development plan that addresses weaknesses and builds on strengths. Involve the employee in the process—otherwise, they’ll think you’re preparing to let them go. Employee potential assessment is not a tool for exclusion, but rather one for guidance, and it yields the best results within the context of effective team management.
Add an external sensor
Sometimes we are so deeply immersed in our own reality that we no longer see what’s right under our noses. An outside expert brings a perspective that an internal manager can’t always provide—not because the manager is less competent, but because emotional involvement and closeness to the team can cloud judgment. Set aside the pride that drives us to think, “I have to find the solutions myself” or “if I ask, people will find out I don’t know”: the speed at which new information emerges no longer allows anyone to be an expert on everything.
When you work with a specialist in personality and skills assessment, you don’t just receive data—you also get a framework for interpretation: you know what to do with the information and how to communicate the results to your team without causing anxiety. And assessing employee potential isn’t a one-time event—it’s an ongoing process that’s revisited as the team grows and goals change. By investing in this process, you’re not just buying a report—you’re gaining clarity on where to direct the company’s energy and resources—exactly what the “red” team in the story was missing. Do you want to accurately assess the potential of the people on your team before investing in their development? Request a psychological profiling audit with Psihoselect.
Frequently Asked Questions
What is employee potential assessment, and how does it differ from a performance evaluation?
Performance evaluations measure what someone has accomplished in the past. Employee potential assessments estimate how much and in what direction a person can grow from here on out—in terms of skills, growth mindset, and areas of risk. This is the step that should precede any investment in training.
Why is mindset more important than experience?
Because a person with a fixed mindset resists change even after the best training, while someone with a growth mindset applies what they learn. Carol Dweck’s research shows that openness to learning predicts performance in demanding environments better than years of experience.
Do I need to hire an external evaluator?
It’s not mandatory, but it helps. An outside expert brings objectivity to situations where a manager’s proximity and emotional involvement might cloud judgment, along with a framework for interpreting data that translates it into concrete development plans.
What should I do if I identify a risk area involving an employee?
Treat it as a starting point for a development plan, not as grounds for termination. Involve the employee in the process, build on their strengths, and work to improve their weaknesses. True potential often lies in how many risk areas can be managed effectively.
