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Internal vs. External Recruiting for Companies

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During the recruitment process, an employer can source candidates from internal or external sources or from both sources. The choice of the recruitment source depends on the employer’s human resources policies, financial resources, and organizational culture (Mathis &  Jackson 79). Internal recruiting entails sourcing for potential candidates from within the organization. Direct appointment/promotion is one of the ways of conducting internal recruitment. The management of an organization selects an employee, who is best qualified to take a certain vacant position within the organization. Internal recruitment is also done through lateral transfer of an employee from one job, section, or department to another. Here, selection of a suitable employee for such transfers is done through referring to the human resources’ information systems, recommendations from colleagues, supervisors’ appraisals, or personal requests (Mathis &  Jackson 80). Internal advertising is used, where an organization invites the existing employees to apply for vacant or new positions.

One of the advantages of internal recruiting is that is helps to build employees’ loyalty (External – Internal Selection Consulting 5). The employees in a given organization are given an opportunity to develop their careers within the organization. This allows an organization to reward its current employees who display good services and commitment. This contributes to improvement of employees’ morale, hence, their performance in the organization. Internal recruitment is also a cheap method of sourcing candidates, compared to external recruiting. When an organization utilizes internal recruiting to source potential candidates, it saves costs such as advertising, consultancy fees to human resources service providers, and induction expenses among others. Furthermore, internal recruitment is faster than external recruitment (External – Internal Selection Consulting 5). An organization can fill a vacant or new position within very few days, while using internal recruitment, since it does not have to wait for potential candidates to read the adverts, send their applications, shortlist the best, interview them, and check their references. Internal recruitment also helps an organization to prevent leaking of its strategies or secrets to outside parties.

However, internal recruitment limits the pool of candidates, thus, hindering an organization from bringing in new skills, ideas as well as competencies in an organization. In fact, reliance on internal recruitment can result into placement of unqualified employees in an organization. An employee may be good in his/her current position, but this does not mean that he/she can perform better in a higher position (unless he/she is qualified for the position). Concurrent placement of unqualified individuals in a given position may have a negative impact on the overall performance of the concerned section/department as well as the overall performance of an organization (External – Internal Selection Consulting 5).

Contrary to internal recruiting, external recruiting is a process of searching for potential candidates from outside the organization to fill vacant or new positions. Advertising is the most common way of undertaking external recruitment. An organization identifies vacant or new positions, and then, attracts potential candidates from outside the organization to apply for the position by advertising them through the media: commonly, newspapers, magazines, and on the internet. Other ways of conducting external recruitment include executive search, graduate recruitment (universities and colleges), and use of employment bureaus/agencies. According to Williams, the best method of conducting external recruitment depends on an organization’s need at that particular time.

Executive search “headhunting,” is the best used, when an organization wants to fill a managerial position or any other high position (Williams 2009). This is because the method entails attracting the most competent individuals within an industry by offering them attractive remuneration packages. Usually, the potential candidate is known and can even be from a rival organization. However, the method is not suitable, when filling entry-level positions. Graduate recruitment is best for entry-level positions (Williams 2009). An organization selects the most qualified candidates from a pool of graduate applicants. It takes them through induction and training process in order to equip them with the necessary skills for performing their jobs. Williams states that employment bureaus are the best for filling a large number of vacant positions because they are cost effective.

One of the advantages of external recruiting is that it allows an organization to select the most suitable candidate(s) from a pool of candidates with diverse levels of qualifications, skills, and competencies (Nankervis, Compton & Morrissey 47). This way, an organization is able to put in place a team of qualified and competent employees. By having a team of qualified and competent employees, an organization is able to save on training costs, since the employees are already conversant with the requirements of their jobs (because an organization hires experienced staff), and have the competency to deliver the best output for the organization. Besides, placement of highly qualified and competent employees helps an organization to achieve improved performance as well as compete effectively in the industry where it operates (Nankervis, Compton & Morrissey 48).

External recruitment also assists an organization to achieve equality in employment as well as meet its affirmative action goals. When external recruitment is conducted professionally, no favors from inside parties or the recruiting team exist. Candidates are selected on merit basis. This helps an organization to achieve a balanced workforce. External recruitment is usually a good source of change in an organization (Nankervis, Compton & Morrissey 48). Outsiders usually bring in new ideas, new solutions to existing problems, or new blood, which facilitate in changing an organization’s culture.

However, external recruitment process is usually time and money consuming. The entire process can take as many as 120 days. This is even worse, when an organization is recruiting a large number of employees. In addition, since external recruiting involves bringing in new individuals in an organization, they have to be inducted and oriented into the organization’s way of life. This process is also time and money consuming (Nankervis, Compton & Morrissey 49).

Nonetheless, an organization can utilize either internal or external sources of candidates, when filling various positions. The choice of the recruitment method depends on the organizations needs and goals during that specific time.

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