Leaders often face whether it is better to promote an internal candidate for the executive or critical job or accept a candidate from an external environment. The external candidate may bring a new fresh perspective to pressing challenges and valuable expertise and capabilities the company does not have yet. What is the situation in Central Europe? According to our latest #survey, companies struggle to attract and acquire top talent in various industries. The fight for Talent is intense in the markets. According to our survey, the biggest challenge is to hire #highly #qualified #experts, primarily in IT, engineering, and electrotechnical industries. More than 70% of respondents would welcome improvement of the current education system to meet business needs.
The survey also shows that more than 60% of the companies usually closed the jobs #internally. An external candidate recruited 35% of jobs. 5% of the jobs were long-term vacancies.
Why do companies prefer to fill jobs internally?
It works. Organizations usually prepare internal Talents in the pipeline as #future #successors for specific roles, developing their skills in the long term. Inner Talents are part of the organizational culture. They often understand the organization and its stakeholders much better than anyone else from outside. It is vital to support these newly promoted candidates during the #adaptation process. Following our survey, the most frequent reason leaders fail in the first 100 days is a lack of proper onboarding.
It improves engagement. Employees are usually frustrated when a company favors an external candidate and does not promote internal candidates for the jobs. If the company does not systematically #cultivate inner Talents and does not provide development and #growth opportunities, top talents leave, and #engagement levels dropdown. Following our survey results, considering and promoting internal candidates substantially impacts the company's organizational culture, engagement, and retention. Companies that invest in in-house succession planning and career programs have confirmed that employee satisfaction increased about 30%.
It is predictable. The search for an executive leader externally can take months. Newly hired leaders usually need 100 days to adapt. In some cases, you will see the results of your new hire in several months or after the first year. Promoting internal Talent always comes with your internal #data on your Talent #performance, #competency profile, #strengths, and #improvement opportunities. Based on your data, you can predict the performance of your Talent in its new role.
It is cost-effective. Hiring an executive-level candidate comes with a price. Failed hiring is much more expensive and may affect company business results, reputation, and in some cases, losing other top talented people. #Cultivating in-house Talent is a long-distance run. It is generally cheaper than the failed executive leader from outside. It is essential to calibrate #personalized development for each Talent, develop its #capabilities and skills, and integrate on-the-job training, #coaching, and #mentoring.
What are the challenges in promoting internal talents?
It's essential to #manage stakeholders' #expectations and understand the market situation, challenges the company is facing, and your talents' readiness. If you need a new capability or skill and can't develop it internally quickly enough, reach the external market.
Following our survey, organizations frequently promote experts to leadership roles without in-depth assessment, usually because there is time pressure to close the job due to business transformation or other similar reasons. Unfortunately, these promotions typically fail and the company losing the expert "promoted to the manager. Based on survey data, these promotions suffered from frequent issues such as #, not #meeting the stakeholder's #expectations, too much #micromanagement, #lower #engagement levels of impacted teams, higher turnover rate, and #burnouts. Some survey participants confirmed they are working on a more transparent and unbiased framework for selecting internal candidates for the pipelines.
Companies need to create a transparent, unbias framework that will provide equal opportunities to all talents and assess talents based on merit and skills to manage these challenges.
A wide range of leaders and experts should participate in this process. Hiring an external leader may bring a lot of positive aspects to company culture. A successful leader in your competition does not mean this leader will be successful in your company. #Culture #fit, #adherence to your #company #values are critical once hiring a leader from the market. Companies that hire for attitude and train for skills receive better results. Therefore, it is beneficial for the organization to partner with an external consultant to bring deep market knowledge, industry expertise, and a proven track record in assessing the new leader.
The decision to promote an internal candidate or hire an external one should not remain on the shoulders of HR only. Every leader should address it, and HR as a business partner is always ready to share best practices and tools for the leader's right decision.