When a position becomes available you have a decision to make. Promote internally, or hire externally? This difficult decision can prove to be an early roadblock during the hiring process. With a business only as strong as its staff, particularly those in key positions, making the right decision is vital.
Unfortunately, as with many things in business, there is rarely a set formula to follow.Hiring managers must rely on their experience, knowledge and gut instinct and still might make the wrong call. I’ve created this article and laid out my thoughts on the issue below to help anyone struggling with this decision.
Candidates promoted from within will enter their new role with a deeper understanding of the business, its strengths, challenges and culture then any external hire can have. Current employees have the advantage of already possessing knowledge of your unique product and customer requirements. Internal staff will be knowledgeable about your organisation and adept at getting things done within your business.
This familiarity can however prove to be a draw back. By looking withing at the same staff, you will often end up with “business as usual”. This continuation of the same style of thinking can cause a business to stagnate. Sometimes, what is needed most is a breath of fresh air, new ideas and energy. Here your knowledge of your own business situation is critical. If your organisation needs to change or move with the times, look outwards. If things are working well, consider promoting internally.
The morale of your employees is crucial to your business success. Promoting existing employees can provide a well needed boost and help increase job satisfaction. If progression within your business appears possible, employees will work harder and stay with you for longer. If, on the other hand, long standing employees are leap frogged in the organisation by an outsider, they may begin to question their loyalty to your company.
The process of internal promotion does however need to be approached carefully. If it’s badly managed, it can lead to staff feeling overlooked or even cause division and jealousy within your workforce. Consider assessing any roles as they become vacant to see if the responsibilities can be split between existing employees. Not only does this save time and money by avoiding the hiring process altogether, it enables more staff members to progress and enjoy an increase in pay.
By looking inwards to fill a vacant position, it’s possible to save your business both time and money. Onboarding and training time will be reduced and chances are, the internal employee will hit their stride much faster than an outsider. Remember, any internal promotion will require a position to be backfilled still incurring hiring costs albeit at a lower rate for a more junior position. Be careful here that short term cost savings don’t harm your chances of long term profitability.
Hiring an external candidate and bringing a new face into the business can seem daunting. No matter how rigorous your hiring process, you can never know for certain how a new hire will perform. When promoting internally, you have the comforting advantage of an existing relationship and and knowledge of the candidates quality of work.
Unfortunately, the distinction between the two isn’t quite as clear cut. Whilst you know how a member of staff currently operates, you can never know for sure how they will manage when taking on new responsibilities and challenges. In contrast, whilst an external hire may not be personally familiar to your business, they may already have an excellent track record in a similar role.
If your business is facing an urgent skill shortage, hiring externally can be a fast way to address this problem. By looking outwards to the wide pool of talent currently available, you can easily access any skills your business might be lacking. Whilst this strategy of hiring to fill talent gaps can be extremely effective in the short term, take care that it does not damage your business in the long term. With more and more employees regarding training and progression as key parts of their compensation package, be careful to balance the short and long term goals of your business carefully.
SO HOW DO YOU CHOOSE?
With two sides to every argument, you may be no clearer at this point whether to hire or promote. For me, the answer is surprisingly simple. For the long term health of your business, always hire the best person available to do the job. I recommend balancing both hiring practises by interviewing both internal and external candidates.
Allowing internal staff members to apply for any vacant role allows you to fully evaluate all the personnel assets within you business as well as helping you to stay in touch with current employees career goals and aspirations. By not limiting yourself to just looking inwards, you can access the full range of incredible talent currently in the job market that could potentially transform your business.
I’d love to know more about how you decide between promoting from within or hiring externally. How do you balance the two sides of the hiring process?
As ever, I’m here to help you and your business. Feel free to be in touch at any time!