Need to fill a position? (internal recruitment pros and cons)

Updated 18 March 2023

You have several recruitment options to choose from to hire a new team member, including internal and external recruitment. Internal recruitment may sound interesting to you. Knowing the advantages and disadvantages is important as it can help you decide if this is how you want to fill a vacancy in your team. In this article, we consider what internal recruitment is and what the internal recruitment pros and cons are.

Internal recruitment pros

The internal recruitment pros are essential when you choose between internal and external recruitment options. Internal recruitment occurs when an organisation first looks at their workforce before issuing a job advertisement for an external candidate (external recruitment). When internal recruitment takes place, you may promote or transfer one of your current employees to the vacant position. Alternatively, you can consider candidates from other departments or teams for your role. There are multiple benefits to internal recruitment. Consider these benefits to help you decide if internal recruitment is the right option for you. Here are some benefits of internal recruitment:

1. It shortens the time to hire

With external recruitment, you hire new candidates you don't know at all. One benefit of internal recruitment is that you may be familiar with the internal candidates. This familiarity lets you skip some steps of the complete recruitment cycle, including advertising the job externally on job sites and job boards and evaluating the candidates' CVs to determine their suitability for the position.

2. Reduces onboarding time

You also save time on onboarding and training since internal candidates have most likely completed these items before. An internal hire is familiar with the organisational rules and culture. They already have connections in the organisation and you aren't obligated to help them meet new people. Even though an appointment to a new role may be a unique environment for an internal candidate, they understand the larger organisational goals.

3. Saves the organisation's money

When you reduce the time to hire and onboard a new team member, you save money. You save on resources used to find and train staff members, not advertising the position externally and not running background checks on your new team member. You can also benefit from the new team member's familiarity with the organisation and their speed to become productive sooner than a new hire could.

4. Builds employee engagement

An organisation's employees fill with excitement when they hear about the possibility of an internal position. The possibility of career growth is exciting. When employees know that the organisation prefers internal staff members for a vacancy, it can build their trust. It boosts morale, improves the retention of employees and leads to a loyal workforce.

5. Minimises professional and financial risks

The organisation has already vetted all internal candidates. Appointing an internal candidate reduces the organisation's risk of selecting an unsuitable person in a position. With internal candidates, you've access to their salary history and past performance ratings. They would also have already completed background checks before their appointment to the organisation. With fully vetted candidates familiar with the organisational culture, you can save significantly on time and make appointments to your positions quickly.

6. It enhances your organisation's reputation

Using an internal recruitment process shows you care for and value your employees and want them to grow in their careers. This care may cause higher levels of employee happiness and your employees may tell external stakeholders about this. Your reputation as a caring employer can become part of your brand, which has positive consequences. It creates a positive workplace culture and tells external stakeholders that your organisation gives long-term career prospects. It may also become easier to attract excellent external candidates for future positions.

Internal recruitment cons

Internal recruitment has many benefits, but there are also disadvantages to consider. There are several disadvantages to using internal recruitment to fill a vacancy. It's critical that every staff member involved in the hiring process, including the human resources team members to the hiring manager, is aware of the challenges internal recruitment strategy may cause:

1. Causes conflict between team members

An internal recruitment challenge is for team members to accept a new manager who used to be a peer. Hiring an internal candidate can be difficult for some team members to adjust to changing roles and responsibilities. Unsuccessful candidates may experience negative feelings.

Some departments may be reluctant to let their talented team members go to let them grow in their careers. Internal hiring can affect interpersonal relationships and requires careful handling. Knowing about these challenges and preparing for them can cause a simple transition.

2. It leaves a vacancy in a team

Although internal recruitment effectively fills a vacancy in one team, it typically results in a vacant position in another role or group. If you also fill the new vacancy internally, this leaves yet another vacancy. Using internal recruitment continuously may cause an endless cycle of shuffling employees between teams. Eventually, you can make an external appointment to avoid creating further internal vacant positions.

3. It limits the choice of candidates

Sometimes you may find it challenging to fill a vacancy with an internal candidate. For example, you may want a candidate with a specific skill set that no internal candidate has. This means advertising the role externally to find a candidate with the correct set of skills. Sometimes the best candidate is someone from a different industry who may bring a new perspective to the role. In quick-changing businesses, internal recruitment could cause your talent to stagnate. It's best to consider each position and its specific requirements when deciding between internal and external recruitment.

4. It may cause an inflexible workplace culture

Hiring internal candidates can cause employees to become too comfortable. Developing an inflexible culture may be negative for the workplace culture as employees may consider changing a threat to how we did things in the past. It may be helpful to implement new methods for doing things, even when there are no changes to the teams performing the work.

5 Ways to address the disadvantages of an internal recruitment process

Although there are disadvantages to hiring internally, there are tactics you can implement to mitigate these. The tactics you can use include:

1. Have an approved policy

It's best to have a documented policy for internal recruitment to explain the process followed to all employees. The policy can explain which employees can apply for internal vacancies. Examples of rules that may apply include a minimum of two years in a position before the employee can apply for another internal role.

2. Explain the hiring process followed

Once you've selected a candidate, be transparent and communicate to internal applicants how the hiring process worked and how you made your decision. If they've questions, consider allowing them to set up a meeting with you to discuss how they can strengthen their future applications. It may be helpful to create an internal employee referral program to reward employees to remain engaged in internal hiring opportunities.

3. Provide options for career mobility

Make sure you always allow employees to learn and grow within the company, even those who don't qualify for future promotions. Some employees may not have an interest or suitability for management positions, but they may have other options to remain challenged and relevant in their current roles. You can develop a reward system with bonuses for those employees you cannot promote.

4. Only share details of open and available positions

If you know about an internal candidate who is perfect for the position, don't advertise the job opening. It's best to not create expectations with employees about being considered for a position when they won't be, which may cause conflict. Instead, advertise a job internally when you don't have anyone in mind for the role.

5. Allow managers to create succession plans

Management and leaders can learn to identify suitable internal candidates for succession planning. Make sure you've your management team in place and ensure other employees can further their careers in the organisation. This approach can help you fill positions quickly when an opening arises - you can check with the heads of departments to find out if there are suitable candidates to fill the position.

6. Don't use only internal (or external) recruitment processes

The best approach to fill positions is to use a combination of internal and external recruitment to fill vacancies. Using both techniques can help you appoint new team members when you need a particular skill set to support your performance. For positions where you don't need candidates with new skills, consider following an internal recruitment process.