Companies must hire qualified executives; leaders in these positions create policies, hire employees, and make critical business decisions. Companies are often torn between promoting tenured employees or hiring external talent. There are clear benefits and real disadvantages to both these options. It’s worthwhile to determine the best methodology for your hiring needs.
Pros And Cons: Promoting Tenured Leaders for Exec Roles
The Pros: Companies who seek to lower hiring costs or eliminate onboarding time often turn to their existing employees for promotion. Promoting senior staff and management typically
increases company morale. Often, internal promotions encourage other employees to create career goals and develop new skills, which usually leads to accelerated and/or improved performance.
Tenured employees have an established work performance record so their trust and dependability is well-proven. Successful internal employees that have “grown up” at your firm are less likely to pursue positions outside the company.
Another benefit with existing employees is their alignment with company culture. An employee with several years of service already executes the mission and lives out the core values of the company.
The Cons: A potential downside to promoting from within is fostering an environment of entitlement. Employees might feel secure in their positions. They do not feel the pressure to perform at a high level on a regular basis. They may begin to feel irreplaceable and further feed the monster known as “promotion privilege.”
The greatest concern with tenured employees: the lack of necessary skills for the bigger position. A tenured employee promoted into an executive role might lack the expertise needed for the job. They may require additional training and/or mentoring from upper management after transitioning into the executive role. This is unnecessary with an outside, experienced hire.
Hiring Outside Talent for Executive Positions: Good and Bad
Hiring from outside the company can be tremendously beneficial; this approach ensures finding the best fit for the specific needs of this critical position. This tactic empowers the company to assemble a top-notch leadership team that will help propel the business forward.
Bringing in an “A player” also brings a fresh set of eyes and perspective that can positively impact company culture, address unresolved problems with current teams, and add specialized skills that may have been lacking in the department or in the C-suite.
External recruiting does offer some risks. They include a lack of understanding of the company culture, a risk that the candidate is not the right long-term fit, and the time required to complete the recruitment process. However, the right recruitment approach mitigates each of these potential cons by vetting and presenting well-qualified candidates. Experienced recruiters understand the technical acumen required for a position. Finally, the best headhunters usually have multiple relationships with top performers in particular industries and/or local markets.
Bottom line: each organization needs to find the right person with the right skill set at the right time that is “just right” for the company in that role. While hiring from within can be beneficial, sometimes it’s necessary to find and onboard external talent to fuel your business. While hiring from within can be beneficial, sometimes it’s necessary to find and onboard external talent to fuel your business.