While an external hire can bring new ideas and perspective to a firm, the benefits of hiring an internal candidate often outweigh an external hire.
According to a 2012 study by the University of Pennsylvania, external hires cost 18% more than internal hires for the same job, and are 61% more likely to be laid off or fired. Internal hires tend to have better performance reviews; and a superior grasp on the company culture, the organization’s personalities and the requirements necessary to succeed.
Although it is sometimes necessary to hire from outside the company, building a culture of hiring from within could help to reduce turnover, improve and ultimately enhance productivity. But blunders in the hiring process could lead to anger, mistrust and disengagement that can spread virally throughout the company.
For hiring managers considering internal applicants, here are five tips to make sure the recruiting process goes over smoothly:
1. Make sure everyone has access to the same information
Telling the people you are closest to in the organization about a new job opening while leaving others out of the process is sure to breed resentment. Make sure that everyone who is eligible to apply for the position has the opportunity to do so and are considered fairly, and all applicants have to go through the same process (i.e. a favored candidate shouldn’t get to go to the final round automatically). If outsiders can apply, make internal applicants aware.
2. Make the interview process fair
In a perfect world, people would be hired based upon their qualifications and experience. Of course, biases creep through the hiring process – research has consistently shown that people hire others that think like them and have similar personalities. This is more of a problem in internal recruiting, because the hiring managers likely already have a professional and even personal relationship with the applicants.
Although eliminating all biases is impossible, do the absolute best to keep those biases at bay and hire solely based on who is right for the job. Moreover, don’t lead on internal candidates. If the decision has been made to pursue other avenues, let the rejected applicant know in a timely fashion so he or she can come to terms with the decision and move forward.
3. Meet with runner-ups in person
While a form email for a rejected external hire will usually suffice, that would not do for an internal candidate. Nor will a phone call or especially a text message. After the new hire, whether internal or external, accepts the position, schedule to meet face-to-face with any runner-up candidates in the company.
While telling an external candidate that the company decided to go in a different direction would suffice for an external hire, it won’t for an internal hire. Be prepared to have some uncomfortable conversations on why the internal hire didn’t make the cut. Maybe they didn’t have the experience. Maybe the candidate needs to brush up on skills. Maybe the candidate’s attitude and demeanor needs tuning.
Although it may feel awkward at the moment, in the long run, candidates will appreciate having these difficult talks. The runner-ups may be very disappointed in the decision to go with someone else and they express that to you. While you should remain steadfast in your final decision, make sure to show empathy and give the candidates time to air their frustration.
Be sure to point out ways they can improve so that promotions and other opportunities continue to remain in sight. Also, if possible, be open to providing different opportunities to take on larger assignments and leadership roles in the company in lieu of the position given to someone else.
4. Avoid leaks like the plague
A decision has been made, and you are going with a specific candidate. Before making an announcement to the whole company, make sure that both the hire and other internal candidates have been made aware and have been given a reasonable amount of time to come to terms with the outcome.
Nothing is worse for morale and trust than an internal candidate finding out they didn’t get the position through office gossip, an internal memo or, the worst, a social media post.
5. Continue to keep runner-ups engaged
Employees who feel valued at the workplace tend to stay around a lot longer and perform a lot better. Keep paying attention to and encouraging the candidates who didn’t quite obtain the position they sought. Offer to provide mentoring, coaching and training to help the candidates reach their long-term goals. If merited, consider title changes or different roles for the valued employees.
Most importantly, let them know that they continue to play an integral role in the company’s success.