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Internal Hiring Vs. External Hiring – Which One Is Better??

Updated on May 5, 2015

At companies, both large and small, there exists a never-ending hunt for top talent

Recently, a trend has been initiated where companies try to find the talent within their premises in order to cut hiring costs and increase the odds of employees being successful in their positions.

Typically, external hiring is the preferred norm in many ways. Organizations tend to steal talent from the competitors in order to bring in new perspectives, among other benefits. Companies used to put attractive job advertisings assuming that larger candidate pool will provide them with better options

But with the recent modifications in workplace culture, where employees are not glued to the idea of a long-time career and follow the ‘job-hopping’/ trend companies are discovering that internal recruitment is far more sensible in terms of costs as well as employee engagement and retention.


Following Are The Top Reasons Why Companies Must Opt Internal Hiring -

An open job position can be filled either by hiring an internal employee or someone who is new to the business. It is recommended that business owners should consider all hiring methods and choose the best.

It’s Economical

Internal hiring allows companies to save on recruitment expenses, training, advertisements, referral bonuses, travel and relocation costs. This makes the internal hiring process more cost-effective when compared to external hiring.


Saves Time:

The entire process starting from reviewing a job description to putting an advertisement to paying a recruiter to interviewing various candidates and to wind up with the actual hire, easily takes up a month or so in case of external hiring. Whereas, internal hiring take up only a few weeks and you will have your candidate ready to take on a new role within a matter of few days.

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It Works Out Better

When an existing employee is hired internally for a different position, there are more chances of success as they are already well-versed company’s working culture and style and thus they don’t need that sweet little (extended) time to adjust to new surroundings.


It’s Good for Employee Morale

Usually, when an employee gets insecure about his/her growth in the company, then they plan to make a switch. Thus, employers can motivate and retain those talents by promoting them internally and ensuring them that they have a fruitful career in the company.

While these are the added benefits of making internal hirings, but, how will you track and pick out worthy applicants from your company? That’s a big question! Having a correct Performance & Talent Management System is crucial for a successful internal hiring. It provides a medium for efficient tracking of employee’s performance, allows collaboration and provide an option to rate and comment on every individual’s work performance.

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