Hiring GlossaryWhat is internal recruiting?
What is internal recruiting?
Often when we think of recruiting, it involves finding candidates who don’t currently work in our company. The typical process of publishing a job listing, accepting resumes and sourcing candidates from outside your company is called “external recruiting,” but it’s not the only way to fill open roles.
“Internal recruiting” is the process of sourcing candidates from within your company. This might involve promoting someone to a more senior role in their current department or it could involve transferring them to a completely new role and department, either one that’s aligned with their background and experience or their personal and professional goals for the future.
Internal recruiting is often part of a larger talent mobility strategy, which involves creating opportunities for your employees to grow and take on new responsibilities within the company. It’s one of the ways people-first companies continue to grow while keeping their employees engaged and motivated.
Let’s take a closer look at why internal recruiting can be a powerful part of your overall talent strategy.
Benefits of internal recruiting
Why should you consider creating an internal recruiting program? Here’s how Maria Culbertson, former Senior Team Manager, Talent Planning & Acquisition at Greenhouse, explained it: “As companies continue to scale, the likelihood of finding talent within the walls of your own organization grows significantly. You have entire talent pools of candidates on hand, fully bought into your mission and ramped on your company. So why not go there first?”
Let’s take a closer look at some of the benefits of internal recruiting.
- Time savings and faster onboarding
Maria hit on a major benefit of internal recruiting: It’s faster, both in terms of finding candidates and getting them onboarded and ramped up in a role. Internal candidates are already familiar with your company’s mission, values and ways of working, which means they’ve got several advantages over external candidates. You can expect their onboarding and time to productivity in their new role to be much shorter since they already know how things work in your company.
- Increased employee engagement and retention
Employee engagement and retention often go hand in hand. According to Gallup, employee retention is one of the biggest challenges organizations face, with only 18% of workers reporting being extremely satisfied with their job and 51% watching for or actively seeking a new job. Internal recruiting gives your employees the chance to learn something new and take on new challenges without as much disruption to their lives as starting a brand-new job. LinkedIn finds that companies that invest in internal mobility enjoy 53% longer employee tenures and 79% more leadership promotions.
- Cost-effectiveness and a more efficient hiring process
External recruiting often requires agency fees, advertising to post on specific job boards and other additional costs. Internal recruiting allows you to avoid some of these expenses. You may also be able to reduce spending in a more intangible way because you can have a more streamlined and efficient hiring process with internal candidates. For example, if you generally have a culture add interview with external candidates, you might skip this portion since you can reasonably assume internal candidates are already familiar with your company culture!
Challenges of internal recruiting
Of course, internal recruiting comes with its own set of challenges as well. These can include:
- Limited candidate pool
If you’ve decided that you will only open a role to internal candidates, by definition, you’re limiting the candidates you’ll consider. For some roles, this can be an advantage because you know your candidates are already familiar with your company and its challenges. But if you’re looking for specific skills or expertise (for example, a sales leader who has helped a company scale from X to Y revenue), you may not always be able to find that among your existing employees.
- Impact on team dynamics and morale
Internal recruitment has the potential to have a positive impact on morale – the employee who gets the new role is likely to be more engaged and motivated than ever. But there’s a potential downside, too. If a number of internal candidates applied for a role and only one person got it, this can create feelings of disappointment and frustration – especially if those who didn’t get the job are now reporting up to a former peer.
- Potential bias toward internal candidates
As with any hiring process, bias can come into play with internal candidates. In some cases, it may act in their favor, with the hiring team assuming that the internal candidate is the best choice without fully vetting external candidates. Or in other cases, hiring teams may assume the opposite – that only an external candidate would be qualified for the role. The best way to limit either type of bias and create a more equitable experience for everyone is to ensure you’ve created a structured interview process where all candidates are assessed in a consistent manner.
Internal vs. external recruiting: A comparative analysis
How does internal recruiting compare to external recruiting? How do you know which method to choose? Here are a few tips to keep in mind.
Choose internal recruiting when:
- You want to promote existing employees
- You believe having cultural and operational knowledge of your company is key to the role
- You want to foster company loyalty
- You’re hiring for a frontline manager role and have the ability to coach and train a first-time or early career manager
Choose external recruiting when:
- You’re seeking fresh talent
- You need new perspectives and skills
- You want to prioritize innovation
- You’re hiring for an executive or senior leadership role and need candidates with specific expertise
Keeping these points in mind can help, but also be aware that you won’t always arrive at a clear answer – you may often encounter situations when you’d like to open roles to both internal and external candidates. Some talent acquisition teams make a point of opening most roles to internal candidates for a set amount of time before opening them up to external candidates. The key is to stay open and make decisions based on what will work best for your company.
Effective internal recruiting methods
If you’ve decided you’d like to do more internal recruiting, there are a few tactics that can help. For example, you can create an internal job board that makes it easier to manage internal applications and hiring processes. Learn more about internal job boards and other talent sourcing features in Greenhouse here.
Your internal recruiting efforts will be more likely to succeed if you also have career development programs that help employees take on stretch projects and develop skills that will help them succeed, like becoming more strategic and presenting in front of large groups. Depending on the size and structure of your company, you may need to partner with your coworkers in learning and development (L&D) to create these types of programs.
Employee referrals can be a sort of middle ground between internal and external recruiting. Your existing employees can do a lot of the groundwork by sharing your company culture and values with people in their network, so these candidates have more knowledge than the typical external candidate. New to the idea of employee referral programs? Discover the elements of winning employee referral programs here.
Lessons from real-world examples of successful internal recruiting
We’ve covered the basics of what internal recruiting is and how it works in theory. Now let’s take a closer look at how some companies and talent leaders are putting these ideas into practice.
- Collaborate with other teams and create clear growth paths
“An effective internal mobility strategy takes the partnership of your talent management teams. Collaborate with them to ensure that you have clear growth paths for your employees and that conversations about growth – whether that be vertical within your org, or diagonal, going outside your team and into other teams across the org – are happening often and always,” said Maria Culbertson, former Senior Team Manager, Talent Planning & Acquisition at Greenhouse.
- Apply the same rigor and consistency you do to external roles
Tasha Ridder, Director of Talent at Pine Gate Renewables, believes that internal mobility can be a powerful way to retain and motivate employees – but only when it’s treated with the same rigor and consistency as the external application process. The “seven-day rule” she instituted requires hiring managers to post jobs internally and externally for seven days. This practice ensures that internal candidates have equal opportunities to explore and apply for positions alongside external candidates. Read more about Tasha’s approach to internal recruiting here.
- Build a company culture where employees feel they can flourish
Here at Greenhouse, we’ve often celebrated internal recruiting success stories in the “Growing in the Greenhouse” series on our company blog. Here’s what one participant, Ariana Moon, VP, Talent Planning & Acquisition (who began her career at Greenhouse as an Associate Recruiter), said about her experience: “The core of why I love Greenhouse – which is having a team that’s inspired, caring, ambitious and tirelessly devoted to doing our best work while having fun – has stayed the same. I know our leadership team especially cares about creating an inclusive environment and is always searching for ways to make us feel heard and valued.”
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