Companies often promote high-performing employees into management based on their success as individual contributors, even though strong job performance alone does not necessarily predict management potential. A better approach is to look at whether candidates have the skills and genuine interest to lead others before putting them in charge of a team.

Yet when a management position opens up, the internal shortlist often forms around the people who have performed well in their jobs, stayed with the company and moved up the ranks. Promoting one of them can feel like the obvious next step.

That veteran technician, high-performing engineer or top salesperson may deserve the recognition. They may also have little management experience — or no real desire to manage at all.

New numbers from Gallup show how common that disconnect is:

• 65% of frontline supervisors got their jobs based on their individual performance or the years they spent in frontline roles.
• Just 30% of them were selected for promotion based on their supervisory skills or previous supervisory experience.
• And 23% hadn’t received any supervisory training at all.
• Engagement (a psychological commitment and connection to the job/company) is just 31% for individuals promoted based on performance or experience (versus 42% for individuals selected who had supervisory skills or experience).

This is where the management mispick takes hold: Someone earns a promotion because they have excelled in one or more roles, without much evidence that they will excel at leading other people.

The consequences can extend beyond the team. Gallup analyzed 136 studies based on structured interviews and assessments of 14,597 managers and found that hiring based on managerial talent increased sales or revenue by 21% per manager and profit by 32% per manager.

Flipping the script here for a minute, some of those financial gains could come from avoiding a costly mistake: pulling a top performer out of a role they excelled at and winding up with a mediocre manager. 

“You lose twice because if Bill becomes an ineffective manager, you’ve also lost Bill, the individual contributor who was fantastic,” says Chris Atiyah, founder of Engtal, a Chicago-based recruiting firm that places hard-to-find talent with companies in various industries. “If it doesn’t work out, the company takes a hit on both sides.”   

How to assess management potential before promoting an employee

Assuming someone will make a great manager, supervisor or department head because they’ve excelled in their current role is obviously a gamble, but there are ways to cultivate stronger candidates for promotion. Gallup sees supervisory training as a good bet but notes that only 45% of frontline supervisors received this type of training in the past year. 

This is a weak spot for organizations that expect team members to assume an entirely different set of management responsibilities. “It's common for people to get promoted and move up the ladder based on their achievements,” says Atiyah, “with the challenge being that a strong technical skillset isn't the same as a strong management skillset.”  

Atiyah says the key is to focus on competencies over performance, both when cultivating future managers and when selecting candidates to fill open positions. Instead of using track records in technical, sales or operational roles, for example, look at how well they work with others, their learning and development records over time and whether they want to be a manager at all. 

He also recommends asking employees early about their management ambitions and, over time, giving interested employees increasingly responsible assignments and training. “How much do they want it? Are they genuinely passionate about developing and managing people? These are the questions to ask,” he recommends. “If they're mostly motivated by a pay increase or a title change, those should definitely be red flags.”

How cross-functional experience prepares future managers

Depending on the size of the organization, its employees may only get hands-on experience with one or two departments. This can work against them when a management position opens up and requires a more holistic view of the business. But there’s this thing in athletics called cross-training, and it works here too. Arie Brish, a board director, author and professor at St. Edward’s University in Austin, saw this firsthand while working for Motorola, where prospective managers were identified early and rotated through different disciplines.