Here’s a question that sometimes confounds supervisors and HR departments alike: Is there a difference between a high-potential employee and a high-performance employee?

The answer is yes, and confusing one with the other is apt to lead to some some poor promotion decisions down the road. It also could deny a business the full benefit of having truly high-potential workers on its staff.

A high performer is easy to spot, clearly excelling at whatever job he or she currently fills. But as the Peter Principle observed several decades ago, there is a tendency in business to serially promote competent people until they reach their level of incompetence. Thus, an asset can become a liability.

High-potential employees are not simply good at what ...