Relative advantages and disadvantages

of

INTERNAL PROMOTION
Vs
EXTERNAL RECRUITNEMT

PUNEET Kr. SINGH

ELECTRICAL
S.No: 1
What is Recruiting?

“Recruiting is the process of generating a

pool of qualified candidates for a particular job.”

It is a set of activities an organization

uses to attract candidates who have the abilities and
the attitudes needed to help the organization achieve
its objectives. Some essential groundwork including
the internal factors and external factors need to be
laid before the recruiting process can begin.
What is internal recruitment?

 This refers to the filling of job vacancies from within

the business - where existing employees are
selected rather than employing someone from
outside.

 A business might decide that it already has the right

people with the right skills to do the job, particularly if
its training and development programme has been
effective.
How is it done?

Internal vacancies are usually advertised within

the business via a variety of media:
 - Staff notice boards
 - Intranets
 - In-house magazines / newsletters (for example, E-
map, a major publishing business) have a weekly
staff magazine devoted solely to advertising jobs
within the organization!
 - Staff meetings
Internal Recruiting—Advantages

 Improves morale of promoted employee

 Improves morale of other staff members
 Managers can better assess the abilities of internal recruits
 Successions help reinforce a company’s internal career ladder
 Lower costs than external recruiting
 Reduces training costs
 Gives existing employees greater opportunity to advance their
careers in the business
 May help to retain staff who might otherwise leave
 Requires a short induction training period
 Employer should know more about the internal candidate's
abilities (= a reduced risk of selecting an inappropriate candidate)
 Usually quicker and less expensive than recruiting from outside
Internal Recruiting—Disadvantages
 Promotes inbreeding
 Lower morale for those skipped over for promotions
 Skipped over staff may feel favoritism exists
 Filling a gap in one department may create a more critical gap in
another
 Limits the number of potential applicants for a job
 External candidates might be better suited / qualified for the
job
 Another vacancy will be created that has to be filled
 Existing staff may feel they have the automatic right to be
promoted, whether or not they are competent
 Business may become resistant to change; by recruiting from
outside, new perspectives and attitudes are brought in
Implementing Internal Recruiting

 Develop a career ladder

 Inventory employees’ skills
 Cross train employees
 Post job openings
 What is external recruitment?

 This refers to the filling of job vacancies from outside

the business (contrast with internal recruitment).

 Most businesses engage in external recruitment

fairly frequently, particularly those that are growing
strongly, or that operate in industries with high staff
turnover.
External Recruiting—Advantages

 Brings new talent, new ideas into a company

 Enables recruiter to find out about competing companies
 Reinforces positive aspects of a company
 Avoids “politics” of internal recruiting
 Serves as a form of advertising
 These are mainly the opposite of the disadvantages of internal
recruitment. The main one being that a wider audience can be
reached which increases the chance that the business will be
able to recruit the skills it needs.
 External Recruiting—Disadvantages

 Difficult to find a good fit with company’s culture

 May create morale problems if no opportunities
for current staff
 Orientation takes longer
 Lowers productivity in the short run
 Conflicts with internal and external recruits
Implementing External Recruiting

 Friends/relatives of current employees

 Educational work-study programs
 Networking
 How is it done?

There are several ways of looking for staff outside the business:
 Employment / recruitment agencies
 These businesses specialize in recruitment and selection. They
often specialize in recruitment for specific sectors (e.g., finance,
travel, secretarial). They usually provide a shortlist of candidates
based on the people registered with the agency. They also
supply temporary or interim employees.
 The main advantages with using an agency are the specialist
skills they bring and the speed with which they normally provide
candidates. They also reduce the administrative burden of
recruitment. The cost is the high agency fees charged - often up
to 30% of the first year wages of anyone employed.
 Contd…

 Headhunters / Recruitment Consultancies

 "Upmarket" recruitment agents who provide a more

specialised approach to the recruitment of key
employees and/or senior management. They tend to
"approach" individuals with a good reputation rather
than rely on long lists of registered applicants - often
using privileged industry contacts to draw up a short
list. The cost of using a headhunter or recruitment
consultant is high.
 Contd…

 Job centers

 Government run agency - good for identifying local

candidates for relatively straightforward jobs. The job
centre service is free to employers and is most
useful for advertising semi-skilled, clerical and
manual jobs.
 Contd…

 Government Funded Training Schemes

 There is a variety of government funded schemes that provide

potential recruits, including the New Deal and Modern
Apprenticeships. The advantage of these schemes is that
government funding lowers the cost of employment and the
business can get to know the employee before committing for
the long-term. However, relatively few employment
requirements are covered by these schemes.
 Contd…

 Advertising
 Probably the most common method.
Advertising allows the employer to reach a
wider audience. The choice of advertising
media (e.g. national newspaper, internet,
specialist magazine etc) depends on the
requirement for the advert to reach a
particular audience and, crucially, the
advertising budget.
 Internal Recruiting External Recruiting
 Advantages Advantages

 Promotes high morale. Brings new ideas and methods

. into the workplace.
.
 Employees are familiar Might facilitate diversity and
affirmative with the organization. action initiatives.

 Employee's performance and Might bring in expertise not

currently skill levels are already available internally
known.

 Promotes employee commitment. A lack of knowledge of current

. internal processes and procedures
. might facilitate innovation.

 Provides a career path for Employee starts with a clean

employees. slate and has no internal .
. political affiliations.

 Provides opportunities for the Might reduce training costs and

employee to increase his or time if the employee comes to the
her salary. organization with skills to do the . .
job.
 Reduces recruiting costs.

 Reduces orientation costs

because the employee already
is familiar with the job and
organizational culture.

 Reduces training costs because

the employee likely has already
learned some of the requirements
of the job through exposure to the
job.
 Disadvantages Disadvantages

 Can negatively affect morale Individual might not be a good and

commitment of those fit with the organization and not
promoted. organizational culture.

 Does not encourage new and Might lower morale and commitment
innovative ways of doing things. of current employees that are
. deprived of promotion opportunities.

 Promotes individual competition Must be oriented into organization for

promotion, which can affect potentially resulting in increased
cooperation and collaboration. time to adjust and reach full
. performance level.