Should I Hire Internally or Externally?

When it comes to filling positions and roles at a company, an employer may stop to wonder – would this role be a better fit for a current employee within the company or a new hire?

While it’s hard to give a one-size-fits-all solution for every situation and enterprise, there are general indicators which can sway a company to lean one way or the other.

1. Boost in Company Morale

Hiring internally sends a message of confidence in your existing employees that there is room for growth and progress within the company. It makes a statement to your employees that should they be ready to take on a leadership role in the future, there will be opportunities for them to explore.

2. Employee Is Familiar with Company Processes

Existing employees have the advantage of being more familiar with company procedures, processes and culture. This eliminates the risk of a new hire who may not adapt well to the culture of the company or the way it conducts business.

3. Less Expensive than External Hires

External hires do cost the company more than it would cost to promote an existing employee. This includes not just a fresh salary amount but the cost and resources of any onboarding or training necessary to get this new hire up to speed. You’ll save on these costs with an internal promotion.

1. Injects new energy into business

Bringing in a new hire can have the effect of bringing new energy into the company which can in some cases boost the dynamic of a team. Picture a charismatic and competent leader who comes in to make structural changes to a team to boost its performance. This could have an exponential effect on team spirit or morale.

2. Brings in new skillsets 

Sometimes you need someone who has the expertise and skillsets necessary for a new role. This might mean having to look outside the organisation for someone truly experienced in a certain area such as digitalisation or SEO skills to start building a stronger team that can hit the ground running.

3. Scaling your business further 

When the goal of the company is to scale further and bring in new departments or teams, hiring externally is necessary to lessen the workload and create more specific, well-defined roles. This way, existing employees aren’t straddled with extra workloads that fall out of their job descriptions for the sake of the company’s growth. Hiring externally would be the more sustainable option in this case.

How to Decide

Hire Externally If…

• Your company is embarking on a strategy shift or a restructuring, bringing in new talent may be the way to go

• There are specific skills which you need to access which are unavailable with existing employees in the company

• The culture of the company is inviting and open to change. Employees will be less likely to feel a disruption or replacement taking place.

• The foundations of training and onboarding are strong within your company to successfully integrate new hires

• Access to succession planning is not readily available or suitable for your company

Hire Internally If…

• Succession planning is accessible, suitable and relevant for existing employees

• Skills are readily available within the organisation, but simply need to be nurtured or developed with training or mentoring

• Organisational culture is more traditional, fixed and less adaptable to change

• Organisation is already thriving and has a sizeable number of eager employees looking to progress within the company

• Very few processes are in place to provide access and support for job training and integration for new hires

If you’re set on hiring externally, be sure to check out Jobstreet’s Recruitment Centre, your personal career agent, to check out the latest candidates who could be right for your business.