Calculating Your Return on Impact

As highlighted by Larry Bossidy in his book Execution, when people, processes, and tools converge with a mindset to execute, you realize Return on Impact. Those who can without fail deliver performance, implementation, and results – despite macro- or microeconomic conditions, setbacks, roadblocks, and challenges – develop a reputation and quantifiable return on any investment made for their ability to perform. An organization’s ability to frankly assess, proactively manage, and develop its high performing and high potential talent with a great sense of agility is a fundamental contributor to this Return on Impact.

High-potential individuals must be thoroughly measured on present performance and development paths for both breadth and depth of competencies and capabilities, as well as their true potential for not only becoming a leader but also their progress along this continuum (how they react to the good, the bad, and the ugly during this journey). So how do you proactively identify and systematically nurture the breadth and depth of relationship development knowledge, behavior, and skills in an up-and-comer? Fewer organizations, unfortunately, are willing to take risks with high potentials in critical roles – they’re demanding high performers and high provens. So how do you assess a high potential’s relationship-centric readiness to drive very real impact in the business? Here is a simple formula:

Current State of Performance (competencies/skills) +
Potential (readiness traits) +
Developmental Plan (good and bad experiences, motivation) =
Relationship-Centric Readiness

That readiness has to then be questioned in context. Specifically, are they ready now? Will they be ready in one to two years with this additional development? In one to two years with a great deal of development? Or, should you “wait and see,” – which is a maintenance mode – and keep this person in her current role to see how well she adapts and responds to challenges?

Picture a square with four quadrants. The x-axis represents Potential and the y-axis represents Performance. In the bottom left quadrant with low potential and low performance you get Under-Performers. With high potential and low performance you get Under-Achievers. While the reverse – low potential and high performance – just leaves you with High-Performers. The ultimate goal with high potential and performance gives you High-Potentials where you can have the greatest impact.