The Financial Impact of Strategic Development and High Potential Programs

Abstract

We examined the talent management practices and financial performance of 300 organizations across 31 countries. Results demonstrated that organizations investing in strategic development and high potential programs financially outperformed their competitors over the course of seven years. Further, organizations’ ability to make effective succession decisions was one likely explanation (mediator) for this relationship. We discuss surprising findings regarding the combination of strategic development and high potential programs on succession effectiveness. Finally, we offer theoretical explanations towards why and when high potential programs may not provide additional value and provide practical recommendations regarding strategic talent management or high potential programs.