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How to know when to hire internally and when to look outside

Rich Hein | May 15, 2013
In a perfect world promoting internally is a good way to lower costs, create a talent pipeline and build morale. However, in the real world, you must weigh those benefits against the need to get the right skillset for the job.

Perhaps the cost in time and resources to get someone up to speed for particular role may be more than you can afford. "Productivity can stall with multiple internal employees learning new roles or taking on new work to help facilitate the change," says Schade.

For example, maybe you only have one Java developer. If he/she moves on, is it easier to train a .NET person to learn Java or bring in a new Java person? "If it's a niche or particularly important role, sometimes you are better off trying to get someone from the outside rather than spending time and money on training," says Cashman.

2. Getting a New Perspective
Today's CIOs and IT pros are expected to be agents of change. In a situation in which a company is looking to make a paradigm shift in how it approaches certain aspects of the business, it may opt to hire externally. "Fresh blood can often revitalize a team, and it's good to bring someone in who has new ideas and a different perspective," says Cashman.

3. External Hires More Experienced and Better-Educated
External hires normally have more experience and have a higher level of education, according to Bidwell's research. The study also indicated that although external hires are at a higher risk of failure, the ones who do make it through the first two years are promoted faster than those hired internally.

What Does It Take to Hire Internally?
To be successful at hiring internally, Schwabel says, you need two things: a solid corporate culture and the right people. "Companies have to focus more on corporate culture and company branding in order to attract and maintain the best people," he says. Once that is in place and you have an internal hiring program that is supported and communicated to the employees your retention should increase, according to the experts.

Create a Long-Term IT Hiring Plan
Creating an internal hiring policy takes time and C-level buy-in. It's a long-term approach to better retention and cost savings. In the real world, however, the state of your corporate culture as well as the business and technological objectives you face all play a part in the decision to hire internally or externally.

Whether you choose to go external or stay inside the company, the bottom-line is to get the best people and retain them. "The best way to hire the right people is to communicate your brand online and offline through all the touch points and to also have a strong corporate culture so when people get there, they want to stay," says Schawbel.


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