Are Companies Any Good at Picking Stars?

Date: 17-06-2015
Source: The Wall Street Journal

Despite new assessment tools, the hunt for high-potential employees is more art than science

Companies are searching for future stars and they’re stumped.

At a time when firms have more data than ever on employees’ habits and productivity, predicting which employees will excel in bigger jobs remains more art than science. These “high potentials” can help companies ensure they have leaders for the long-term, but managers say their picks don’t always work out.

“People are horrible at predicting the future,” says Tom Rauzi, director of global talent at Dell Inc.

For the moment, algorithms aren’t much better. Some makers of human-resources software say they’re working on developing new ways to predict potential but aren’t quite there yet. And companies like Nokia Corp., American Express Co. and SAP SE are rethinking how to gauge employee potential—focusing on new metrics, using games to identify traits like perseverance or classifying workers’ abilities differently—but have not yet developed a quantitative approach that cracks the code.