How to Identify Leadership Potential in Your Team: A Guide for Companies

Proper leadership provides organizations with direction, motivation, and structure within the workplace and cultivates success through facilitating the communication of team members. Good leaders can identify goals for your company and put steps in place to achieve them while simultaneously building a positive company culture. 

Knowing how to identify leadership potential in your employees helps you build a diverse team of leaders, ensures continuity, and increases your ability to keep your top team members. It starts with observing employees in leadership scenarios, gauging their work ethics, looking for strong communication skills, and more.

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Understanding the dynamics of leadership potential

The internal factors that influence a person's leadership potential include personal traits (compassion, empathy, resilience), skills (communication, creativity),  motivation, and adaptability. At the same time, external forces like company culture and opportunities also play a role. However, identifying leadership potential typically requires a keen eye and time. You may need to observe them in various scenarios and how they work with different combinations of team members to give them opportunities to demonstrate the skills, knowledge, and talent needed to guide and direct people.

Identifying potential leaders already working in your organization comes with several advantages. This person already understands the inner workings of your company, which can make the transition for this individual into leadership that much easier. Additionally, when other employees notice that you promoted one of their peers, it raises morale because other workers see that career advancement can happen. 

Read more: What Is Effective Leadership?

Tips for Identifying Potential Leaders

When assessing employees, it's helpful to distinguish between general potential within the company and leadership potential.

1. Look for key indicators of leadership potential.

As you observe your employees, look for the key indicators suggesting something has what it takes to lead teams, starting with exceptional communication skills. Addition signs of leadership potential include the following:

• ability to motivate others

• adaptability

• conscious learning

• critical thinking skills

• decision-making skills

• emotional intelligence

• empathy 

• initiative

• problem-solving skills

• strategic thinking 

Good leaders typically use these skills to take initiative in a company and harvest a proactive and solution-oriented work environment for themselves and their colleagues. 

2. Examine past performance.

Looking at an employee's past performance can be a starting point for identifying them as a leader. They may have taken on leadership roles in the past and demonstrated their ability to direct a team. At the same time, remember that you may have untapped leadership talent hiding in the rest of your workforce. Previous leadership experience shows what someone has done for a specific project at a specific moment in time. Compare what you know about the employee's previous experience with what you see in them today and assess the individual as a whole.

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3. Utilize leadership assessments and tools.

Leadership assessments and tools can help you measure the skills and abilities of individuals to help identify potential leaders in the workplace. Consider how you can utilize the following tools. 

Personality and behavioral assessments

Personality assessments help reveal individuals’ natural characteristics and motivations, which can measure how many leadership qualities they have. Similarly, behavioral assessments provide insight into an individual’s leadership skills by analyzing their specific behaviors related to a management position, such as assertiveness, independence, and resilience.

360-degree feedback

Under the 360-degree feedback model, peers and employees anonymously provide feedback on an individual's proficiency in areas like communication, teamwork, character, and leadership. This type of assessment is useful when identifying leadership potential within your company because it allows for a variety of opinions on an individual’s ability to lead a team. 

Leadership potential surveys and questionnaires

You can utilize leadership surveys and questionaires to discern specific characteristics that indicate this individual contains leadership potential—personality traits, long-term goals, workplace skills, and more. The information you gather through these tools can also help you predict the type of leader—passive or transformational—this person might become. 

Performance metrics and key performance indicators (KPIs)

Performance metrics consist of data used to analyze an organization's success and growth, including sales, profit, customer reviews, and overall quality. These metrics can help you track patterns and identify the specific team members whose leadership skills played a role. You also can track KPIs like punctuality, attitude, cooperation, and collaborative problem-solving.

4. Create opportunities for leadership training and development.

Training and development is a crucial part of maintaining success for your company, and leadership development programs are one way to guide your team members to their full potential. These programs teach the skills necessary to motivate and inspire employees, which results in increased productivity and engagement while also raising your retention rate. 

Even though many leadership development programs stress the importance of communication and producing results, which are both vital for successful leaders, make sure to help your future managers improve additional, sometimes overlooked skills such as guiding remote/virtual teams, advocating for inclusion, and leading a team filled with members from different generations. 

Successful mentoring and coaching play pivotal roles in helping the future leaders of your business flourish. When team members are given the opportunity to learn from professionals in their field, they can receive feedback and guidance to nurture their leadership skills. Combining mentorship and participation in leadership courses, such as the Leading People and Teams Specialization offered by the University of Michigan,  is one way to ensure the success of potential leaders.

Read more: 8 Tips for Developing Your Leadership Skills

Build your team’s leadership skills on Coursera

Effective leadership is essential for setting goals, motivating teams, and fostering a positive work environment. With the right methods and training, you can discover the next generation of great leaders already working within your ranks.

Promote leadership skills throughout your organization by developing employees who innovate and inspire. With the Leadership Academy from Coursera, employees can learn the skills needed to lead your business into the future. With Coursera for Business, you’ll build effective managers at every level with beginner and advanced-level leadership content, including 40+ SkillSets to drive soft skill proficiency across the entire organization.