A Complete Guide to Internal Recruitment

25 August 2021
10 minute
A Complete Guide to Internal Recruitment

We have all faced at one time or another the challenges of replacing a team member; it can be really difficult not just to find someone that can fill a skills gap, but also be engaged in what the business does and how it does it. 

But there is a school of thought that challenges the normal considerations of recruitment when it comes to filling that gap and that is internal recruitment - recruitment that comes from within your existing workforce. 

It makes a lot of sense when you think about it, you already have the staff available and there could be the need to upskill someone within your organisation or provide a different view point and analysis which the team could be lacking. We will look into the different reasons later in the guide. 

In this guide we are going to give you a thorough understanding of internal recruitment, what the associated advantages and disadvantages are, how internal recruitment vs external differ and finally, how to develop your own internal recruitment strategy.

What is internal recruiting? 

Internal recruitment is the process of filling vacancies in a business from its existing workforce. Unlike external recruitment which looks to fill vacancies with people outside of the existing workforce, internal recruitment is a method of recruiting that is widely gaining traction in businesses of all sizes thanks to the complexity of the recruitment landscape. 

Internal recruitment is also one of the many typical processes that happens within a business on a regular basis - but you may never have considered it as internal recruitment. For example:

  • Staff promotion

It is common to see staff promotions in all sorts of businesses. Whether it is a junior office worker becoming a manager or a senior level employee going onto the board of directors - or even running the company, staff promotions are one of the main forms of internal recruitment. 

  • Staff transfers

Again, transfers are something we all come to see in our working lives and this is even more common in today’s mobile working environments where staff can move from one place to another and find themselves in a new city regularly. 

Staff transfers also apply to staff moving between departments. We see this more commonly happening in job fields such as automotive, technological and telecommunications - but they are not limited to those fields. You can find sales people moving into marketing departments and vice versa for secondment roles as well as permanent moves as well.

  • Temp to permanent

We will have worked with people who were temps before they were full time employees. Temp to permanent is more common than you would think, especially in organisations who find that the temp worker has the right attitude and skills to manage the workload they are given. By making them full time, the organisation doesn’t have to focus on further recruitment costs or time consuming onboarding (more about this later).

  • Employee referrals

And finally, another internal recruitment tactic is employee referrals. There could have been a meeting where a skills shortage was discussed and a manager in that meeting may have someone in their team who would be the perfect fit or it could be that for an employee to improve their career prospects, a sideways move may help - this is all supported by employee referrals.

Advantages and disadvantages of internal recruitment 

Of course, when a new position opens up, it can be very difficult to fill that position with standard recruitment procedures of looking to the marketplace. You may feel that your team balance would be disrupted with a new, unfamiliar face or that you “simply don’t have the time.” All of these make for reasons to internally recruit, but they are not the best starting point. 

So what are the advantages and disadvantages of internal recruitment? We are going to take a closer look at some. 

Internal recruitment advantages

  • Employees already engaged with organisation values and purpose
  • No need to undergo an onboarding process - reduced training needs (and expense)
  • Boost employee morale by promoting from within
  • Significantly reduce recruitment expense - no need to advertise or use agencies
  • Improve staff retention
  • Retain talented employees
  • Time taken to fill an important role can be significantly reduced

Internal recruitment disadvantages

  • Need to recruit someone into the role of the internally recruited/transferred staff member
  • Leaves skills gaps from the person who was just recruited in the old department
  • No beneficial fresh ideas or insight that can be derived from new employees
  • Not always a viable strategy for fast growing organisations
  • Can promote conflict between employees
  • Exclusively recruiting from existing staff reduces the pool of applicants to choose from

Internal vs external recruitment 

External recruitment is when you go to the job market to fill a role in your organisation. The candidate more than likely has no experience within your business (with the exception being old employees who may have left some time ago) and is applying with a fresh set of skills, ideas and knowledge that can be added to the organisation. Candidates will know about the role through job boards, recruitment agencies and even word-of-mouth. 

We have seen what some of the advantages and disadvantages are in internal recruitment, but what are some of the associated advantages and disadvantages of external recruitment? 

External recruitment advantages 

  • New staff can bring fresh ideas and perspectives. This can help with problem solving, making processes more efficient and sometimes quicker.
  • The external talent pool is much larger than internal which makes recruiting for more specific or even more generic skill sets easier. You have a wider experience base to pick from and can enjoy the selection process of candidates who fit a more accurate description of the role required. 
  • External recruitment can identify people who already have the experience, skills and qualifications needed. 
  • It’s possible to attract staff away from competing businesses - which can help with long term growth and development and stifle a competitor’s ability to compete in the short term game. 
  • You don’t create a competency or skills gap by removing anyone from their post, instead you are bringing in talent which can even be of benefit to other departments and workloads.

External recruitment disadvantages 

  • There are sometimes significant costs involved in the recruitment process. From advertising roles, recruitment agents that are used and even the internal time it takes to find the right candidate all cost money. This can be a contributing factor to external recruitment on the wane in some industries. 
  • It can also be a lengthy process that saps up time and resources. From the hiring manager to even members of the team being used in the interview process to find someone that best fits.
  • One of the biggest challenges of external recruitment is finding the right candidate who equally, has the skills and fits in with the work environment and team that they are in. If the wrong decision is made, you could find yourself looking in a few short months for a replacement. 
  • Onboarding can take time, resources and energy away from the management/HR functions which means that where the staff member should be getting on with filling in that skills gap - they are distracted with other tasks rather than the one they have been chosen for. 

Developing your internal recruitment strategy

We have seen the positive impacts that internal recruitment can bring to an organisation, but how do you go about creating a strategy that rewards this type of recruitment approach and combine it with other elements required to find the right staff for the roles in your organisation - be it internally or externally? 

The solution is to create a clear internal recruitment policy that can be used as a tool to help with internal recruitment purposes. We are going to talk you through developing your own recruitment strategy. 

Fundamentally, once this document has been created, getting it to all members of staff and building it into the HR process is essential. When an opportunity arises to recruit from within your organisation, this is the strategy that must be followed but to make that work, it requires everyone to know that the system must be followed. 

The internal recruitment process

The internal recruitment process allows anyone within the organisation to be able to apply for a role unless they have otherwise been promoted into it, or recommended the vacancy from their line manager. 

This helps to give employees proper encouragement which can help with not only motivation but also showing what skill sets they have that meet the requirements of the vacant position. The internal recruitment process thus must identify some key considerations for anyone thinking of making an application. What needs to be included in the job advert? Here are some suggestions:

  • Basic candidate requirements

I.e. Minimum time spent in the organisation. Things like time already spent within the organisation will give an idea of the acquired skill sets, their ability to understand what the workplace culture and environment is like and if they already have established relationships with members of the team and so on. 

  • Who is responsible for defining roles and who makes the hiring decisions

This is where the hiring manager's name is associated with the job posting. You may want to specifically state that “all applications must be forwarded to x person” with HR CC’d. 

  • How the internal candidates will hand over existing responsibilities

This may be a specification over how long the transition into the new role will take and who your current line manager is. It may also include things such as requirements to show what current projects or deadlines you are working on.

  • How they will be trained into their new roles

Specifying training will also encourage candidates from different areas of the business who want a career change to see this more favourably. Training in new areas of the business to them will be of benefit for their career longevity as well as progression.

  • How internal vacancies will be defined and communicated with existing staff

If you are replacing a role, any announcement should come after the person leaving has made it public knowledge to their team/colleagues. Doing so beforehand can be interpreted as a negative move. Also defining who gets to send out the job notice via email applications or an intranet service must be clear in the guidelines.

  • What is required from internal applicants in their applications

You may want to specify just what exactly it is you want from your applicants as well. A C.V., a cover letter, it could be an answer to a job based question or even undergoing some psychometric tests as part of the application process.

  • How applications will be screened and candidates selected for shortlisting

Defining how applicants will be screened and shortlisted is an internal process for hiring managers to follow. This could include things like, years of service, basic skills competencies, a face-to-face meeting etc. 

This is where you could also utilise psychometric testing and help identify candidates through behavioural analysis in the questionnaires as well. Combined, this gives candidates a much wider chance to show their skills and workplace attitude.

  • How applicants will be provided with beneficial feedback on their applications

Once again, this is defining how applicants should be given feedback on their applications. It may be that there is a face to face meeting about the process or a simple email detailing why they weren’t successful - this time around. By giving clear instructions in your process you are helping managers understand the need to be clear in their communications with their staff. 

How Thomas can help you with internal recruitment

Internal recruitment is the process of filling vacancies in a business within its own existing workforce. From understanding workplace culture to even shortening the recruitment process, internal recruitment has become synonymous with many beneficial traits and can yield positive results for the organisation in the short and long term.

Thomas psychometric assessments can be used to help hiring managers identify potential candidates and talents within the organisation that may be suitable for more than one role within the business. This can help the organisation understand its talent pool and look to internal recruitment as a long term strategy in the success of the organisation. 

If you would like to learn more about how we can help you with internal recruitment, please speak to one of our team.