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Should You Hire for a Position Internally or Use an Outside Hire?

Summary: A dilemma often faced by the hiring department is whether to hire someone internally or find an outside hire to fill a new position.

Should you hire for a position internally or use an outside hire?


In the life of most HR professionals, there comes a time when you have to compare an inside candidate to a candidate from outside the organization. Will your evaluation of these two people be fair and equitable? While your evaluation processes may differ from assignment to assignment, what does seem clear is that your knowledge of the two candidates is not inherently equal.


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The Insider

You and your organization may have known this person for a long time. But, even if they have been with you for only a few months, it is long enough to have observed work habits and made assessments that are usually gained over an extended period of time.

How does this person interact with others on your staff? What about meeting deadlines and budgets? Is this person a team player or someone who always wants to go it alone? Are the day-to-day leadership qualities of this person present?

Certain strengths and weaknesses may only become visible over time. Latent tendencies that do not appear in the hiring process can later become an important part of the person's organizational role.

It also seems like these observations are tilted in one direction. While it is true that we all have experience where we see the blossoming of a talent or a trait in a fellow employee, it is more true that over time one finds "flaws."

The Outside Hire

This, on the other hand, is a person whom you may not know and is 'on stage' during the entire time that you are meeting. The screening process only allows you and your team to make assessments on the obvious traits of the candidate. The candidate's more hidden traits remain undiscovered.

Experience proves that when a candidate obviously does not seem to fit, your judgment is almost always correct. It may be easy to see those traits and talents that are wrong for your organization--and you can stop the process then and there.

The opposite, however, is often not true. A hiring decision based on traits and talents that you admire and think valuable does not always lead to a successful employee.

The Tradeoff

The tradeoff is this: How do you balance your observations of both candidates? When all things are equal, the outsider will almost always look better than the insider. They are presented in a setting designed to show off their best qualities. Yet the risks associated with the outsider are also greater. You already know the flaws and foibles of the insider, while those of the outsider are, to a great extent, unknown.

It all comes down to a judicious use of your HR sense. You make allowances for the unseen and unknown, and then fairly evaluate the candidates in the best interests of the organization.

Of course, there is an additional issue. It matters how existing employees perceive your promotion policy. Hiring from the inside is a morale boost for everyone else. It demonstrates that you can grow your career and succeed within the organization.

See the following articles for more information: