Recruiting Internally: The Pros and Cons

The internal recruitment maze can be a strange beast in any organization. Sometimes it’s simply a half-page on a bulletin board, or a piece in the company newsletter that says “Current Vacancies.”

More technologically competent businesses have online recruitment pages, and may even supplement them with development opportunities and promotional materials.

There’s a balance to be made between searching outside for the best talent, and using the in-house pool of skills. When you have a job that needs to be filled, a decision needs to be made on which way to go.

Internal recruitment is cheaper. You don’t need to pay for print or online recruiting ads. With less applications, less time needs to be committed to sift and sort through applications, so less manpower is needed. These costs can be a significant factor when you decide whether or not recruiting internally is right for your organization.

internal hiring job board

Internal hiring sometimes isn’t very sophisticated. Seriously. Flickr/cwgcph

The internal recruitment process is usually far simpler and easier to manage. The individuals interested in applying for a position will be known to the company. They don’t need to provide a detailed resume for review—the last annual review and some manager comments or recommendations are probably sufficient.

There will normally be fewer applicants internally, and the selection process is easier to manager. Again this is less resource-intensive, so it’s cheaper.

A big advantage for internal recruitment is the speed at which you can get someone placed. With this slicker process, candidates don’t have to choose between multiple employment offers, and long notice periods are easily avoided. External recruiting can take 3 months or more from start to finish; internally, the process can be much shorter.

Internal recruits already know the business. They don’t need onboarding, and they don’t need the company culture to be explained to them. They’ve already lived it. They should be able to slot right into place without needing much of a settling period. The internal hire usually won’t need as much training or company information as an external recruit.

The down side to this is that it’s usually only beneficial for promotion opportunities. Internal applicants don’t often want to move sideways in the organization. Thus you may be increasing pay and perks for the person, as well as creating another vacancy behind them.

The disadvantages of internal recruiting need to be given fair consideration too. With the vacancy domino effect, one recruitment exercise can turn into one for each level, and still result in an external recruitment for the lowest level vacancy.

This links to the salary challenge of internal applicants. They will likely know the salary of the previous jobholder or similar role. Their request will be in the same price point. This means no opportunity for market-led salary reductions from an external resource pool.

You can also consider the overall cost of the position, given length-of-service benefits and expectations that will be carried over. It’s unlikely an internal recruit will be willing to surrender service benefits.

When you recruit externally, you can bring in “new blood” with fresh thoughts and ideas. Repeated internal recruitment inhibits this opportunity for innovation and renewal in the business.

Most organizations need a healthy balance of fresh and existing talent. Internal and external recruitment both have a role to play. Using both wisely allows you to develop the best workforce for your company.

 

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