--By Rachel Emma Silverman

 

It’s not what you have achieved, but what you might achieve. 

A new study by scholars at Stanford and Harvard found that in a wide variety of settings people get more excited about individuals with potential and promise than those with actual, proven performance — and are more willing to hire and pay more for these high-potential candidates. (We’ve noted here that many companies prefer to hire– and even pay a premium for– snazzy outsiders, rather than promote tried-and-true insiders, even though the latter often perform better. 

 

“If your résumé hints more at your potential, rather than your achievement, people are going to think you are a more exciting and more interesting candidate than otherwise,” says co-author Michael Norton, an associate professor at Harvard Business School. 

 

However, he adds, you need to have actual accomplishments to back up the claims of potential. “If you have no achievements that could be a problem,” he says. 

 

The researchers used eight experiments to come to their conclusion that potential (e.g., “this person could win an award for his work”) is more powerful than performance (e.g. “this person has won an award for his work”). 

 

In one study, 77 subjects evaluated two hypothetical applicants for a management job. One rated very highly on a test measuring leadership potential but more moderately on a test measuring actual leadership achievement. The other candidate rated highly on a test measuring leadership achievement, but more moderately on the test measuring potential. The subjects were more excited about the candidate with the thinner résumé of achievement, the researchers found. 

 

The researchers also had participants simulate managing an NBA team, evaluating players based on actual scoring stats for a five-year league veteran or on projected stats for an incoming rookie with five years of predicted outcomes. The subjects showed a clear preference for the untested rookie and were willing to pay some 20% more — which translated to $1 million more — than the proven veteran. 

 

In another study, the researchers ran two Facebook ads for a comedian. One touted his achievements (”Critics say he has become the next big thing”) while another offered his potential (“Critics say he could become the next big thing.”) The ad showing the comedian’s potential were more than twice as likely to be clicked and garner a “like” than the former. 

 

The researchers don’t know for sure why potential is seen as more appealing than performance, but one theory is that potential carries with it a sense of uncertainty — the candidate could achieve greatness or not. 

 

While experienced candidates present a detailed picture about what their performance limits are, for those with thinner résumés the sky is, potentially, the limit, says Dr Norton. He adds that with unknown candidates, people tend to focus on upside potential, and “not nearly as much on the downside risk.” 

 

How can these lessons be applied to your own workplace or job search? The study’s authors suggest emphasizing potential in résumés and job-recommendation letters-while also providing evidence to support that claim. “When endorsing individuals for jobs, promotions, or graduate school, then, it seems prudent to highlight their potential as a means of engaging recruiters,’ employers,’ and university admissions officers’ interest,” they write. 

 

Moreover, those making hiring decisions should be aware of these biases when evaluating candidates, so they don’t ignore candidates, especially well-known internal ones, with demonstrated expertise. When managers are too wowed by potential, “you can start to make decisions that aren’t in the best interest of the organization.” 

 

The findings have implications beyond hiring, too. For example, the authors suggest framing support of a teammate or project — say when angling for scarce company resources—in terms of potential rather than achievement as a way to make that support “more engaging and persuasive. 

 

The paper was published in the Journal of Personality and Social Psychology which was co-authored by Zakary Tormala and Jayson Jia of Stanford Graduate School of Business and Michael Norton of Harvard Business School. (The Wall Street Journal)