The top 5% who can change your company

How to grow and retain star employees

Originally published on JOTFORM.COM

Every team has its star members:

Wayne Gretzky
Abby Wambach
Michael Jordan
Simone Biles
Lionel Messi

These luminaries help the group to reach big milestones.

Some have extraordinary abilities (like Messi’s speed or Biles’ sky-high vaults), while others create team cohesion (Gretzky’s on-ice vision and Wambach’s leadership).

Many excel in both of these categories.

Organizations also have standout members, which are often referred to as “high-potential employees.”

As consultants Jack Zenger and Joseph Folkman explain, high-potential staff are usually in the top 5% of all employees:

“These people are thought to be the organization’s most capable, most motivated, and most likely to ascend to positions of responsibility and power.”

While everyone’s contributions are valuable, star members typically have a disproportionate effect on innovations, achievements, and results.

According to Harvard Business Review, the Pareto principle, which holds that 80% of all effects come from 20% of the causes, also applies to star team members. Studies show that “across a wide range of tasks, industries and organizations, a small proportion of the workforce tends to drive a large proportion of organizational results:

  • The top 1% accounts for 10% of organizational output
  • The top 5% accounts for 25% of organizational output
  • The top 20% accounts for 80% of organizational output”

I’ve certainly noticed this effect in my company, JotForm. Everyone works hard, but there are always a few people who rise above the crowd.

And we have both the “geniuses” with jaw-dropping talents and invaluable leaders who enrich the company culture.

Ultimately, star employees can have a major effect on our organizations, so it’s important to consider how we can identify, nurture, and retain them for the long run.

The 5 qualities of star employees

Before we can identify high-potential employees, it helps to consider what “star” performance means. Every organization will need to create its own definitions, but in my experience, standout performers have five traits in common.

1. A great attitude

Strong employees have a growth mindset, so they don’t dwell on negative issues or situations. They always want to move forward. These team members also respond well to constructive feedback. For example, when their work is critiqued, stars dig in and push to find new solutions. Inevitably, they come back with something better than expected.

2. Distinct skills and abilities

Skills are not the same as talent. While someone could have a natural gift for drawing, becoming truly skilled takes time. It requires concerted effort. Star players care enough to hone their abilities, which also stems from a growth mindset.

3. The confidence to aim high

A high-potential employee will accept a challenge and then set the bar even higher. And it doesn’t matter if that bar exceeds their experience or skills; they’ll still tackle the problem head-on.

That doesn’t mean stars don’t fail sometimes. We all do. The ability to get up, dust yourself off, and overcome your fears is what matters.

I try to watch for people who are ahead of the pack — who are attempting what others haven’t even considered yet. And again, it doesn’t matter if they succeed; it’s exciting to see people stretching themselves.

4. The drive to stretch and grow

Raw talent is a good start, but greatness requires internal motivation. Star employees have an innate drive to create. Often, they pursue side projects, or tackle personal goals outside of work (watch for these when you’re interviewing).

As authors Tomas Chamorro-Premuzic, Seymour Adler and Robert B. Kaiser explain, drive is the “will and motivation to work hard, achieve, and do whatever it takes to get the job done. It is easily identified as work ethic and ambition — an ability to remain dissatisfied with one’s achievements.”

5. Strong communication skills

Extrovert or introvert, a skilled communicator can effectively convey ideas, understand other people, and collaborate to solve problems. They have empathy and aim for clarity, so misunderstandings don’t lurk under the surface.

Communication is closely tied with social skills, which, according to the same Harvard Business Review story, involves two fundamental abilities:

“The ability to manage yourself and the ability to manage others (relationships). Employees likely to succeed in bigger, more complex jobs are first able to manage themselves — to handle increased pressure, deal constructively with adversity, and act with dignity and integrity.
Secondly, they are able to establish and maintain cooperative working relationships, build a broad network of contacts and form alliances, and be influential and persuasive with a range of different stakeholders.”

How to identify potential stars

To prepare their top performers for leadership roles, some companies now create formal High Potential (HIPO) programs. Yet, research shows that managers often struggle to identify true leaders.

In a study of nearly 2,000 high-potential employees in three organizations, Zenger and Folkman found that 12% of these HIPO participants were actually in the organization’s bottom quartile for effective leadership. Overall, 42% of HIPO members scored below average.

That’s a long way from the top 5%, but in many ways, the research makes sense.

It’s not always easy to determine whether someone has a growth mindset or strong motivation during an interview. And sometimes employees take time to show their true potential, or they’re hired for the wrong role.

We certainly don’t have all the answers, but there are a couple of processes that help us to spot the rising stars.

  • First, our internship program at JotForm helps us to find high-quality people. We receive more than 1,000 applications each year and select the top 50 candidates. It’s a chance to see potential employees in action before we commit to a full-time role. Many of our best team members have come from this program.
  • Next, we often hire junior employees for product support and maintenance roles. They learn about the company and we observe how their teamwork. When these employees thrive, we often move them into higher-level positions.
  • Our demo days also give employees the chance to shine. It’s so interesting to see their problem-solving skills in action, and to see who’s pushing the proverbial envelope. Interns often show their work, too, which helps to spotlight strong candidates.
  • Finally, we watch for momentum. High-potential employees are always improving. They accept feedback gracefully, apply it thoughtfully, and strive to advance. Consistent growth is a great sign.

How to grow your stars — and encourage them to stay

Nurturing and retaining star employees requires a similar approach. That’s because high-potential staff have an insatiable need to grow. So, if you empower them to achieve their goals, they’ll naturally want to stick around.

Provide challenging work

Stars thrive when they’re challenged. In my experience, this applies across the board — regardless of personality types, roles, talent, or age. So, even if an employee doesn’t have the skills to match the challenge, chances are they’ll rise to the occasion.

Don’t micromanage

Nothing breaks the spirit of a high-potential employee quite like micromanagement. As we’ve discussed, stars are usually self-motivated, so they need freedom to develop creative solutions. At the same time, they need to know that someone cares about the work. I try to provide feedback and encouragement, but I also try to step out of the way when a top employee is on a mission.

Group stars together

Great employees love working with other great people. Their effectiveness multiplies on strong teams, and then everyone benefits. After all, nothing incredible is ever achieved by a single person (other than painting the Mona Lisa, perhaps).

Invest in training, courses and conferences

When budgets are tight, it can be tempting to cut education from the expense sheet. But, training your top performers is truly an investment in the company — and a stronger future for everyone.

A colleague once advised me to make employees sign a waiver stating that if they leave the company, they have to pay back their training expenses (which can cost several thousand dollars). I think that’s unfair. It goes against the spirit of our company. And as Henry Ford famously said, “the only thing worse than training your employees and having them leave is not training them and having them stay.”

Accept eager volunteers

I love when someone volunteers for a task or a role, because it usually means they’ll do an amazing job. Returning to the all-important growth mindset, volunteers usually see what needs to be done, and they want to experience that challenge or acquire new skills. Whenever possible, let them run with it.

Consider holding hack weeks

Hack weeks are five-day sprints where our product teams set day-to-day tasks aside to focus on a single problem or challenge. These immersive periods have led to some of our biggest innovations — and they allow employees to flex their creative and technical muscles. Hack weeks are also catnip for star team members.

Find the right fit

Sometimes we see great promise in a staff member, but they just don’t fulfill those high expectations. Instead of giving up (either on the person or their potential), it’s often worth moving them to a new role. Try to find an area where they will be successful.

What high-potential employees can offer

Most leaders want to ensure that their whole staff base is thriving — and that’s a worthwhile goal. I never want to undermine anyone’s contribution or underestimate their potential. At the same time, top employees bring more than sheer talent and cultural currency to the table. They also:

  • Attract more awesome people to your company. Star performers want to collaborate and challenge each other. When your talent base is high, it shows that good things are happening at the organization.
  • Raise the bar for everyone. When someone achieves an impressive feat, it expands the whole team’s ambitions. Morale and confidence grow, and people begin to believe they can solve tough problems — which usually means they can.
  • Make teams better. Standout employees are force multipliers who make the group exponentially more effective. As former NHL goaltender Ken Dryden once said about the legendary #99, “Gretzky made his opponents compete with five players, not one, and he made his teammates full partners to the game.”

A final word of encouragement

In the rush of daily deadlines and ongoing projects, it can feel unnecessary (and maybe even unfair) to think about nurturing star employees. Yet, I always try to remember the old saying, “a rising tide lifts all boats.”

Encouraging excellence will pay off for everyone. And even if an employee starts below the bar, yet continues to grow and develop, they may eventually reach impressive heights.

Pay attention, keep them challenged, and one day, even those “dark horse” candidates may surprise you — and themselves.