Is it better to promote your next executive from within or hire from outside? There are advantages and disadvantages —and politics — to both options.
Filling a vacancy is a situation every manager at any level will have to deal with at some time. But when that vacancy is for an executive position—and the successful candidate will have decision-making powers over everything from strategies to budgets—ensuring you find the right candidate is crucial.
But is it better to promote from within or hire from outside? There are advantages and disadvantages to both options (and there is a correct course of action, but I’ll get to that in a moment) and, whichever way you go, there’ll be some politics to get right.
Let’s dive in.
The advantages and disadvantages of hiring from within
Plenty of ambitious senior management-level employees have their eyes on landing their first executive role and those who feel they are ready (or perhaps want to flag their career intentions) will want a shot at an appropriate executive-level vacancy.
The advantage for the company if you promote from within is that half the battle is won: they know the operating systems, they understand the company culture and they already know the people involved. Any new hire, obviously, will take time to get up to speed in those areas. An internal hire can hit the ground running.
The disadvantage with hiring internally is you miss out on the opportunity to bring in new skills and experience that could cross-pollinate your organisation and open up new markets, directions, opportunities and efficiencies.
Why it’s always best to consider external options
Then there’s the flip side of the above scenario—which is something I’ve seen firsthand just recently.
A global mining business was creating a new senior leadership team. Previously they’d had a structure with a management team all reporting to the managing director, but they came to me to find executive leaders to form a new ExCo. They wanted an additional COO, CBDO and CTO. All the positions would be external hires, except for the chief technical officer, who they planned to recruit internally.
They advertised for the CTO internally and all the candidates went through my independent process. There were some excellent candidates internally, but through the external executive search process for the COO also uncovered some external options for the CTO.
Ultimately, we found someone externally who was renowned for their very high skill levels and who had broader experience than the internal candidates and complimented with the COO. Naturally, that person was hired.
As you can imagine, it was a very sensitive situation but the result was a positive outcome for the company—they got the best possible person for the job.
What to do every single time you hire an executive
When hiring to fill any vacancy, especially at an executive level, the question shouldn’t be “do we promote internally or hire externally?” The focus should always be on finding the best possible candidate to fill the role, according to your needs and expectations, regardless of whether they are internal or external.
There are some simple tricks to get that right, and to avoid any unpleasant politics or unnecessarily upsetting sensitivities.
- Have a consistent, independent, external process. Every candidate should go through exactly the same process, without fear or favour. Using an experienced executive search consultant is the simplest way to ensure this
- Set expectations early. Do the communications groundwork early so all internal candidates understand it’s an open recruitment process and they’ll be competing with external candidates and don’t assume the job is theirs
- Be ready with support for unsuccessful internal candidates. The risk with unsuccessful internal candidates is they may feel disappointed, disillusioned or angry, and may choose to leave or become disruptive. The best way to avoid this is by taking the time to explain why they aren’t moving forward in the process and providing support, opportunities and advice to help them be better positioned for future executive opportunities.
Mining People International has more than 26 years’ specialist experience helping mining companies uncover the best candidates for board level and executive leadership roles. Find out more about our executive search service here or get in touch directly.