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When a position opens up at a business, most leaders will turn to candidates outside the company to fill the opening. While hiring from outside the company can infuse new energy and ideas into the business, it can also be quite expensive. An alternative to this option is internal recruitment, which fills open positions from candidates who are already within your workforce. There are pros and cons to each approach to hiring. Here are some key things to consider about internal versus external recruitment, so you can decide which is best for your organization.
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What is External Recruitment?
Most business leaders understand the process of external recruitment. When a position opens at the company, the HR department or hiring managers are assigned to find a replacement from outside the company.
Job descriptions are written and posted on various job board websites. Social media posts are sent to followers. Advertising dollars are spent in print and online media. External recruitment can also take the form of online recruiting through sites such as LinkedIn, at in-person job fairs, or at open houses the company hosts.
Pros of External Recruitment
One of the main advantages of external recruitment is the infusion of new ideas, input, and skills into the company. When a company is able to attract talented individuals from outside the organization, they can benefit tremendously from people who think in different ways than the current employees.
External recruitment adds diversity to an organization. It provides an opportunity to bring in people who have had vastly different previous work experiences, which can help grow your company’s approach.
The process also allows you to pick from a much wider range of candidates. You may even be able to pluck a candidate from one of your competitors, using the industry knowledge they gained there to help your company.
Cons of External Recruitment
A major con of external recruitment is the cost. There are definitive hard costs of external recruitment, including the cost of posting job openings and money spent on onboarding and training.
There are also hidden costs of external recruitment. This can include downtime in production, paying overtime for other employees to make up the work, and possible disruptions in services to customers.
External recruitment eats up a lot of time from your current employees. Those who are directly involved in recruiting new employees are taken away from other responsibilities. This, again, can result in a disruption in other important services.
Recruiting from outside the organization can also cause employee morale to go down. When you look to fill an opening from outside the organization, you are passing over potential candidates from within. This may convince certain employees to look for a new job, since a current opening will be closed to them now.
What is Internal Recruitment?
Internal recruitment is the exact opposite process. Instead of filling an opening with a person from outside of the company, you’ll look to your current employees to fill the opening.
This is a popular option when the opening is a supervisor or manager-level position rather than an entry-level position. Your HR department can identify a list of potential internal candidates who would be a good fit for the position. This could involve transferring an employee from one location to the next, promoting an employee into the role, moving a part-time employee to a full-time role, or even asking current employees for external referrals.
Pros of Internal Recruitment
Recruiting internally dramatically reduces the time it takes to fill important positions. Since these people are already employees of your company and know your current processes, they can easily transition to the new position. While you will certainly need to train them on their new job responsibilities, you won’t have to take the time to search for, interview, hire, onboard, and train an external candidate.
Internal recruitment is also less expensive than external recruitment. All costs related to writing job descriptions, posting job openings, and taking employees’ time for interviews and training can be completely eliminated.
Another major benefit of internal recruitment is the significant boost it can have to employee morale. Not only will the person who fills the job feel empowered and appreciated, but other employees in your company will be encourage by the feeling that they can move up within your organization as well.
Cons of Internal Recruitment
When you recruit internally, you will be limited to a narrow talent pool. While your company could have multiple qualified candidates, it will certainly be a lot less than what you could find outside your company.
Internal recruitment could also lead to a square peg-round hole situation, in which you are forcing a fit with someone who might not be the best match for the position you have open. Hiring from within also doesn’t infuse your company with new energy. It could lead to a stagnated company culture. With no new ideas and thinking brought in from the outside, it’s more difficult to force major change.
At the same time, internal recruitment doesn’t completely solve a problem. It just shifts it from one position to the next. While you may be able to fill an upper-level position quickly, doing so will create an opening in the position the newly-promoted employee will vacate. In other words, you’ll be solving your one opening with internal recruitment—but you still may need to turn to external recruitment to fill the new void.
Expand Your Business with SERVIAP
SERVIAP is a leading Professional Employer Organization (PEO) ready to help your business expand operations throughout the Western Hemisphere. PEO is a model of co-employment, where we assume total responsibility for your talent, allowing you to focus on the strategic activities of your organization. Contact us today to learn more about how you can expand your business in South America and Latin America.