When should hiring plans focus on internal recruiting vs. external hires?
When we hire at Pingboard, we always start by asking if there’s someone on our team who’d be a good fit for the role. Why? For starters, our people are awesome, and we’re invested in their growth. But – of course – during a period of growth, we need to hire people from outside the company to fill open roles. Here’s what the research and HR experts say about when to promote within and when to bring in new faces.
The case for internal hires: Speed, culture, and cost
Current employees already have detailed knowledge of a company and its culture, empowering them to get up to speed in a new role more quickly than outside hires. In fact, a recent study from the Wharton School at the University of Pennsylvania found that it takes about 2 years for employees hired from outside to perform at the level of employees promoted from within. 2 years! The same study showed external hires can cost more – companies usually pay them 18% more than internal hires.
Additionally, providing your current employees with paths to career advancement and growth increase their satisfaction and engagement. So, there’s a strong case for promoting from within when your company is focused on maintaining culture, moving quickly, and limiting costs.
The case for external hires: Growth, expertise, and fresh perspectives
Of course, it doesn’t always make sense to promote from within. And if your company is growing, you’ll need to build a robust pipeline of external candidates into your hiring plan.
According to a recent article from Price Harding, a founding partner of executive search firm CarterBaldwin, one of the most important reasons to recruit external candidates is to gain expertise from outside your company – and possibly even outside your industry. He notes that “more and more executive level positions are being filled with external leaders who have developed a certain skill set rather than internal leaders that have developed a specific product or industry knowledge.” Sometimes, external hires are needed to fill a “maturity gap” – for example, if a young startup grows quickly, disrupts an industry, and needs some experienced industry pros to bring their knowledge and relationships into play. Other times, the scenario is reversed. According to a recent interview by SHRM with another recruiting leader, “when companies are in tough turnaround mode” or when current employees don’t have “the courage to disrupt legacy thinking and relationships,” it might be time to beef up your external hiring strategy.
Letting employees know you’re hiring with Pingboard
Whether you’re working on your internal recruiting strategy or hoping to get great external referrals from your people, we’ve added something new to help you keep employees in the loop on open roles.
When you add a new role to your live org chart in Pingboard, just flip the hiring switch to hang a little red “hiring” sign on the card. Then fill in the description with key responsibilities, target start date, a link to the full job description, or whatever other context you think is important to share.
What positions are you hiring for right now? Add them to your org chart!