9 Talent Management Attributes: Better to Hire From Outside or Inside?

When you’re looking to hire new workers, is it better to hire from the outside or from the inside? This is not a new question, and it does not have an easy answer. In our experience of attracting, developing, engaging and retaining top talent, the best answer is that “it depends.”

Here are some of the factors to consider when you are looking for top talent to build your organization’s current and future capabilities:

1. Length of time to hire
Look internally first if you need to fill a position quickly. It takes far less time to hire from within because your talent pool is on site, easily accessible, and known.

2. Speed to productivity
Workers promoted internally typically get up to speed faster than new external hires. It is generally acknowledged that external hires take up to about two years to be fully productive in their new jobs. Everything is new…they have to build relationships and figure out where to go for support and resources.

3. Institutional knowledge
Hiring internally allows you to build on the employee’s knowledge of how the company works. They have developed the firm- or industry-specific skills needed to succeed.

4. Cultural fit
There is no doubt that an employee who does not fit the organizational culture will not be as effective as an employee who understands and adheres to the values and behaviors that the company espouses. Presumably, if you hire from within, you can be pretty certain that the employee knows and supports the organization’s culture.

5. Morale and company loyalty
If you hire from the outside as a matter of course, you risk undermining employee morale and their loyalty to the company. Employee engagement experts will tell you how important the idea of career development can be to your work force. If employees do not see a path toward advancement and growth, they will be discouraged and disengage or leave.

6. Cost
Almost always, it is more expensive to hire externally. Hiring managers have come to expect to pay 10 to 20% more for outside hires. This can be because of external hires’ more impressive resumes or because it costs more to lure them away from their current position into one that is somewhat uncertain.

7. New skills and approaches
The one clear and persuasive advantage to hiring from the outside is that you bring new skills and approaches aboard. Companies benefit from multiple perspectives and diversity. The mix of ideas in an open environment fosters innovation and constant improvement.

8. Onboarding process or system
If you hire externally, you should be confident that your onboarding process is a sound one. The faster you can incorporate new hires into the fabric of your organization, the faster they will contribute to the company’s overall business success.

9. Performance on-the-job
Despite getting higher pay, Pennsylvania Wharton School professor Matthew Bidwell’s research on hiring decisions in the investment banking industry shows that external hires receive lower performance scores during their first two years at a new organization as compared with internal hires in similar positions.

So it’s a mixed bag. Consider your unique situation carefully before hiring and prioritize the factors that are most critical to your organization’s success.

How to attract, develop, engage and retain top talent

Share:
Facebook Twitter Google+ Email LinkedIn
Files under:  

Comments are closed.

We have been able to utilize LSA’s extensive network of top-notch resources to leverage our investment in employee development. The result has been the cost effective and highly efficient delivery of quality educational and management training programs.

Steve Feller
Vice President, Human Resources

Our company engaged LSA to do a specialized “train the trainer” program, and the consultant’s performance outdid our exceptionally high standards for such a program. Very crucial to the success of this program was the work done upfront to discuss our needs and to interview key members of our organization so that the program specifically met our goals. Our facilitators continue to comment on the success of the program. Thanks also for the follow-up.

Frank Abbott
Chief Financial Officer

LSA has become the gold standard in team building and management training at Genomic Health! I have a hard time finding facilitators that come close to their level of customization, expertise and experience.

Emily Couey
Director of Human Resources

I’ve partnered with LSA Global at two companies now, and I consider them a valuable and trusted training and consulting resource. They recommended just the right solution to address our management development needs and have wonderful facilitators that match YuMe’s culture and style of our management team. I would highly recommend LSA Global to any company wanting to deliver quality learning solutions with a valuable learning and development partner.

Maya Paul
HR Director

We recently contacted LSA Global to assist us with a unique training request. We gave LSA a very short deadline and LSA custom designed a training program to meet our exact requirements within the limited time allotted to them. We found their facilitator to be well versed in the subject matter and very credible; the design provided practical and valuable information to our team of managers. I highly recommend LSA Global, particularly in the area of management training.

Julaine K. Souza
Senior Vice President

We engaged LSA to design and deliver a 6-month custom executive coaching program for a group of our key leaders. The focus of the program was to help a core group of senior leaders to leverage previous investments in management training, to ensure the engagement and retention of key employees, and to push critical strategic initiatives forward. Even with the high expectations of our senior people, LSA has completely exceeded our expectations. I would recommend them to anyone looking to create and implement a custom coaching methodology using proven tools to drive true change.

Ivan Fukumoto
Senior HR Manager - Staffing, Training, & Development

LSA exceeded all my expectations. We interviewed 7 potential training and consulting partners and selected LSA due to their expertise, flexibility, and breadth and depth of solutions. We were able to construct a management training course from the modules most appropriate to our needs, and are able to provide additional training from their well developed portfolio of experts. Our managers galvanized as a team throughout the session and are better prepared for the rigors of a competitive market.

Mitch Mandich
CEO

Edify

I’ve been associated with LSA for the last 8 years and have found them to be an extremely professional, well managed full service training organization. Since working with LSA, I’ve participated in a number of solutions ranging from Performance Management to Assertiveness Training – I’ve found that the quality of the resources is superior. They are well prepared and have definitely done a considerable amount of pre-work in order to customize our culture and business into the total learning experience – making it most beneficial for our employees.

Duane Schroeder
Human Resource Manager

LSA’s consultant designed and delivered a half-day team building solution for our recent conference. It included careful customization to integrate the design with our new mission and values. Everyone had fun and identified key issues with our teamwork. Altogether a great program!

Bob Ward
Director of HR

Here’s a token of my appreciation for ALL your efforts. I’m offering my most sincere appreciation, and it extends to all the folks who made our customized management development programs possible.

Susan Anderson
Workforce Planning Bureau

Working with LSA Global has proven to be extremely valuable and worthwhile. LSA understands our business, has deep expertise in content areas, and tailors the programs to deliver great results. The facilitator was extremely knowledgeable about Working Globally with India and her energy and passion made the session interesting, fun, and enjoyable for all that attended. The participants walked away extremely pleased along with highly useful practices and tools. I would highly recommend LSA Global to any company that has partners or offices in India.

Glenn McGillivray
Human Resources Business Partner

Intuit

We signed up with LSA early on–as their 22nd Member! Since then, our organization’s learning needs have increased and decreased and increased again with the changing times. The beauty of the LSA business model is its flexibility…when we needed to supplement our own internal resources, we used LSA services knowing that we could depend on the outstanding quality of the leadership development and management training programs they provide.

Margie Bunting
HR Manager

LSA’s customized Effective Presentation Skills program has helped me elevate my presentation skills to the next level. I now have a much greater self-awareness of my presentation skills and can leverage off of my strengths while working to improve upon other areas. I would definitely recommend this solution to anyone for whom business presentations are an integral part of their job.

Jim Elliott
Senior Marketing Manager

Samsung

LSA has been a tremendous asset to my portfolio, both at my current company and my past company. As an HR leader, I am always looking for ways to find external resources that can provide a solution to our management training needs. LSA does that for me. Their solutions are presented in a much more leadership-oriented manner so as to be crisp, business relevant, and easy to apply right back on the job. I will continue to augment our programs using LSA solutions.

Ken Boehm
VP of Human Resources

Hyperion has a commitment to lifelong learning. LSA helps us provide the right business sales training, management training programs, and leadership development programs at the right time to meet the needs of both individuals and departments. I especially appreciate their ability to listen to my needs and recommend the appropriate facilitators, solutions and content.

Sarah Parks
Senior Project Manager

Hyperion

Evaluate your Performance

Toolkits

Toolkits

Download key published insights and tools from industry experts highlighting best practices in the areas of talent, strategy and culture.

More

Health Checks

Health Checks

Want to know how you stack up against leading organizations?  Receive a complimentary benchmarking analysis courtesy of an LSA Expert.

More

Whitepapers

Whitepapers

Get up to speed on timely solutions critical to your business. Published by LSA Experts based upon client feedback and key industry trends.

More

Methodology

Methodologies

First we identify the key metrics you want to improve. Then we assemble a dedicated team of elite experts who have successfully solved similar problems with similar clients.

More

Blogs

Stay up to do date with the latest information on how we help high growth companies align their culture and talent with strategy.

More

Case Studies

Client Case Studies

Real world consulting and training approaches from LSA projects, providing insights on how your company can outperform the competition.

More