The latest survey by the American Management Association states that one third of organizations prefer to hire within. What are the other two thirds missing out on? Today’s Advisor will explore the ups and downs of this topic.
The relationship between a recently open position and hiring can seem simple and obvious. When one employee leaves, hire another. An American Management Association survey, discussed in a recent article by BLR®, says that the majority of employers take this stance. They wait until they need someone before they start looking. As a result, the company is already behind before it even begins interviewing.
Sometimes, a more proactive approach is in order. Many organizations find that a program of retaining and developing existing employees—and then hiring from that pool—can be of great value. Employers who rely on outside hiring don’t consider an important factor: employee loyalty and morale.
While employee loyalty has no exact dollar value, it is nonetheless a vital metric. The reactionary method of recruiting talent from the outside has the downside of making current employees who may have been a good fit for the open position feel overlooked, damaging their sense of loyalty.
As every manager should know, low morale can have sweeping consequences. Performance will suffer and employees will be more likely to leave the company, resulting in even more vacancies to fill. Employee turnover costs U.S. businesses approximately $11 billion every year, making overall retention the perfect tool to fix the problem. An important part of retention involves hiring from within.
Hiring from within can help boost morale, and a lot more. Here are some other advantages of hiring within:
Tomorrow we’ll take a look at the nuts and bolts of dealing with potential internal hiring trouble, plus an introduction to BLR’s HR Playbook: HR’s Game Plan for the Future.