Internal Versus External Recruitment - Which Is Best?
When deciding whether to recruit staff to fill vacancies either from within an organization
(internally) or from outside the organization (externally), the advantages and disadvantages of each will need to be taken into consideration:
Internal recruitment
Advantages
* Lower cost, because not paying external agency to recruit for you
* May improve morale of existing staff
* Recognition and reward of the good performance of internal staff
* Reinforces & supports the company's succession planning strategies
* Internal staff are a 'known' quantity with existing information available about their skills
Disadvantages
* Can reinforce existing negative culture
* Run the risk of 'in breeding'
* Those that are not promoted can become discontent
* A strong performance management system is required
* Can encourage political 'in-fighting' for promotions among internal staff
Typically, if internal strategies are widely used by an organization, then the majority of outside recruitment only takes place for lower level jobs, which then serve as an entry point into that organization. This strategy works particularly well in organizations that have an embedded and effective succession planning process in place.
The disadvantage of these internal strategies is that vacancies often will attract applications from staff that are clearly not qualified or unsuitable for the position, even though they may be otherwise thought of as valued employees. How to manage potential 'fall out' and sustain staff morale in the face of unsuccessful job applications needs to be managed carefully by the organization.
External recruitment
Advantages
* Avoids the risk of creating resentment by promoting 'favorites' from the inside
* Outsiders bring in fresh ideas, skills and knowledge
* Forces internal staff to 'compete' & update their skills, education, etc
* Helps to facilitate change in culture
* New blood' & more dynamic workforce
Disadvantages
* New appointee may not fit the existing culture within the organization
* May affect the morale of internal staff who have been over-looked
* Require a longer period of induction and orientation
* Helps to facilitate change in culture
* May take longer to fill the vacancy
* May create resentment from existing employees
Many organizations may seek to fill a vacant position internally in the first instance, and then follow through with an external campaign if no suitable inside staff are identified. To avoid resentment among existing staff, the organization must be clear and consistent in communicating the corporate recruitment policy as it relates to sourcing suitable staff.
The major disadvantage in an external job search campaign is that it can be time consuming and costly, particularly in a full employment economy. Organizations need to be wary of the state of the labor market as it relates to the particular vacancy at hand, so that an effective external recruitment strategy can be clearly thought through and put into place.
For example, sales jobs are notoriously difficult to fill but are usually 'mission critical' to an organization, given that they are integral to securing a company's income. In such instances, and in order to fill the vacancy quickly, the nature and extent of advertising (e.g. local, national or overseas advertising) will need to be taken into consideration. On the other hand, when there is high unemployment, a smaller and less costly campaign may be sufficient.
by: Tim Williams
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