Potential vs. Performance: Rethinking the Leadership Pipeline
September 25, 2026 – Being a successful business leader has always been associated with a fast-paced management style, but today more than ever, leaders must constantly adapt and be prepared to navigate rapid change. Leadership roles across organizations of all types have become increasingly complex, requiring the ability to balance competing priorities at the same time. In this environment, it is worth taking a fresh look at how future leaders are identified. The most promising future leaders and top business performers are closely connected, and while some managers may be both, they are not always the same individuals.
Where top performers excel at execution, emerging leaders demonstrate the ability to work with different personalities and goals, to communicate clearly and upfront, and to build cultures of accountability that feel open and cohesive, according to report from Neil Kouba, managing partner of IMSA Search Global Partners Canada and CEO of Pivotal Integrated HR Solutions. “At the core is emotional intelligence,” the study explained. “Strong self-awareness and empathy are crucial for leading, forming the infrastructure for effective working relationships.”
“Strong organizations set themselves up for success by understanding and valuing both the profile of the top performer and the emerging leader, without confusing them,” the report said. “It’s crucial to encourage top performers to deepen their skills in roles where they genuinely excel, while separately and intentionally seeking out and nurturing highly adaptable, strong communicators within the organization regardless of current performance ranking. Distinguishing between these two types of people, then providing professional development early-on, is a strong strategic investment any organization can make in its own future.”
A Demanding Moment for Leadership
The urgent need for resilient leaders is at an all-time high. IMSA noted that several years from a pandemic that turned every global market on its head, business leaders are keenly aware of the unpredictability of the future.
“Accelerating technological change, the rise of automation, ongoing geopolitical volatility, and changing business norms all demand flexible and dynamic leadership,” the report said. “Leaders who can manage ambiguity and build resilient teams across different personalities and skillsets are deeply valuable to an organization’s long-term prospects. Identifying this potential early is key.”
The consequences of not distinguishing between leadership potential and performance can be detrimental, but the pattern is consistent. Gallup data on management talent finds that companies place candidates with the wrong skills into leadership roles 82 percent of the time. “And at a closer look, the mismatch is rarely technical, but interpersonal,” the IMSA report pointed out. “People who may create tremendous value as individual contributors to the company but struggle to communicate clearly, listen actively, or operate smoothly amongst rapid change and diverse perspectives won’t make effective leaders.”
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“The risk of funneling anyone creating value into a single promotion track is twofold,” the IMSA report added. “High performers with strong executional skills may be placed into leadership roles they’re less suited to, while people who may thrive in those roles are overlooked. And if interpersonal skills go unrecognized, employees stop practicing them and default to safer, standardized choices. Organizing new initiatives, surfacing a longstanding inefficiency, or rallying a team around an idea are all behaviors that signal leadership capacity while creating genuine value for the organization. Seeking out, identifying, and funneling this behavior towards leadership gives organizations management and C-suite teams that are both resilient and loyal.”
An Intentional Talent Development Strategy
The first step to better identifying future leaders is a deliberate shift in how and when organizations evaluate their people, according to the IMSA report. “Assessments of team members’ future-facing leadership potential must run alongside evaluations of past performance,” it said. “When traditional performance reviews happen in a vacuum and focus too heavily on short-term metrics, the opportunity to recognize strength in innovative, interpersonal behaviors is lost. Scanning for leadership qualities can look differently for everyone, but may include adaptability under pressure, strong and clear communication, ability to manage and build trust with different personalities, and influence within a team.”
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“Strong future leaders are typically the team members who communicate quickly and effectively with everyone around them,” said Mr. Kouba. “It’s that person with the pulse, who listens actively and exchanges information with ease. Giving these high-potential employees early opportunities to lead initiatives, mentor peers, or communicate across functions offers skill-building opportunities that also helps nurture strong future leaders for the company.”
“Critically, this approach works in tandem with rewarding technical high performers, who can be recognized and compensated in ways better suited to their strengths,” Mr. Kouba said. “Performance incentives, raises, advancement on technical tracks, and genuine praise of the value they create are all crucial. Some top performers thrive as deep subject matter experts, individual contributors, or advisors. Organizations that build support structures for both people leaders and performance achievers will be well positioned for both to excel.”
“Success in identifying future leadership is bigger than talent management,” Mr. Kouba concluded. “Organizations that begin now, with talent pipelines already developed within their companies, are the ones building models that will hold under pressure. Leadership teams shaped by culture with deeply embedded values can not be easily replicated. Distinguishing these two pathways with care and intention is a direct investment in cohesion, resilience, and innovation that compounds over time.”
IMSA Search Global Partners is an international executive search network with 25-plus member countries and over 50 offices across Europe, the Middle East, Africa, Asia, and the Americas. Members of the IMSA International Executive Search network are all boutique search firms.
Mr. Kouba is managing partner of IMSA Canada and CEO of Pivotal Integrated HR Solutions. He has more than 20 years of experience in recruiting and payroll and has been with Pivotal since 2009, becoming a partner in 2013. At Pivotal, Mr. Kouba provides strategic oversight of the business and leads the company’s payroll and temporary staffing divisions, while his recruiting background has focused heavily on senior and executive-level finance and accounting assignments across Canada.
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Contributed by Scott A. Scanlon, Editor-in-Chief and Dale M. Zupsansky, Executive Editor – Hunt Scanlon Media
