So a supervisor, managerial, or executive level position at your company has opened up recently. How do you fill it? Do you promote from within or being in talent from the outside? This is a scenario faced every day by companies across the nation; across the world too. Every company has its own philosophy on this age old decision and many companies do both interchangeably. If your company is new and you’ve never faced this type of situation before or it’s such a key role that you don’t want to pick the wrong choice, what do you do? We lay out some important information to consider when thinking about this question.
It makes sense for a company to want the bells and whistles that come with “superstar” top talent brought in from outside of a company. The training process will be minimal because they are already experts or highly experienced in their industry. They may bring with them a list of clients or fawning media coverage. If your industry is niche enough, or if the superstar is well-known enough, word of the acquisition of the superstar may cause competitors to consider if they’ve been underestimating your company. This is not an exhaustive list of perks, but regardless of how long the list is, the overall cost is higher than that of hiring from within. So the obvious question is “is the extra cost worth it?” Sometimes it is and sometimes it isn’t, but let’s look at the benefits of hiring from within first.
“You can’t put a price on loyalty” is an old saying that analysts and researchers have found to have a lot of truth to it in most scenarios. In the workplace they have found that those promoted from within are much less likely to get fired than those brought in from the outside. They have also found that companies tend to underestimate how important it is for an employee to be familiar with the culture of a particular company to be successful. Employees promoted from within typically already have that box checked. Lastly, promoting from within tends to have a positive effect on morale because it gives hope to other employees that they can get promoted at the next opportunity and the person who got promoted are more likely to have a better appreciation for the position because they’re more likely to know the caliber of people who have held it in the past.
Ultimately the choice is yours, but there are many analysts and researchers who have found that hiring from within, especially for senior level positions, is better than bringing in talent from the outside. The outside superstars typically don’t end up being worth the extra cost and there’s a strong possibility that by the time they get integrated into the corporate culture, they may just up and go to a different company again.