There are many advantages to promoting from within. It benefits your employees, increases loyalty and saves you from the risk of an outside hire.

“We have an open position!”

What is the first thing that usually happens in a company in such a situation? We look to the right, we look to the left, we look up, down, and every which way. Whom do we already have in the company who can step into this role?

Promoting from within has several advantages. It creates a career path for employees. The candidate(s) already knows the company. They already fit in with the culture. No recruitment is necessary. Through internal succession planning, the timing of a replacement can be more intentionally managed.

On the other hand, internal promotion also carries the potential of a few distinct disadvantages, including becoming complacent or myopic about the company, lack of fresh perspective on the industry, and the big elephant in the room: What if it doesn’t work out?

There are always two options to seriously consider when it’s time to fill open positions:

1. Outside hire
2. Promoting from within

Outside Hire

Hiring into any organization at the leadership or management level is much riskier and more costly than at non-management levels. Perhaps because of this, we are seeing a growing trend toward temp-to-perm hiring. Though this isn’t (yet) as common at the managerial levels as it is at lower staffing levels, it is gaining in popularity, particularly at the director and executive level, through project-to-perm.

There is the old saying: “People don’t quit companies. They quit managers.” In our experience, the most challenging match to make when hiring from the outside is finding someone with both industry experience who is also a strong cultural fit in the hiring organization.

The project-to-perm model offers an invaluable opportunity to test fit and performance (on both sides) when a candidate matches most other criteria—on paper and in person—during a critical search.

And when hiring from the outside, one advantage for a company is the opportunity to be as prescriptive and specific as possible regarding what a role ideally would bring to the table. The existing leadership team can “think big.” They need not limit their vision of a vacant position’s relevant skills, abilities, and background; it need not be constrained at the outset to those of existing employees.

Finally, considering an outside hire can eliminate the possibility of hiring the wrong person from inside, then losing a valuable part of the team as well if the promotion does not work out. This is a risk that can weigh heavily when determining a the outset which direction to go.

In the project-to-perm model, rather than bringing in someone directly to fill a leadership position, an outside executive can join an organization to assist with a project (or two, or three) first. This offers everyone an opportunity to evaluate fit in a more systematic and objective way, creating synergies between organizations and the independent workforce to help match available talent pools with work that needs to be accomplished.

Promoting From Within

When promoting from within, candidates may not initially have all the desired skills and background. But they already have a cultural fit, and the organization has (ideally) identified a pool of individuals with leadership potential ahead of the need. And it is fully prepared to support internal candidates with appropriate training, mentorship, and a strong leadership development plan. It is ready to take on the challenge of developing its own succession plan.

As with outside hires, there are a number of considerations when looking to fill a role from within the company. Robin Throckmorton, president of strategic HR inc., says, “Promoting from within can be a great retention tool. Employees see this as an opportunity. It is tough to retain great talent when outsiders are being brought in above them for promotions. Be cautious, and be prepared as part of workforce planning for when a promotion is available; beware of promoting from within as a spur-of-the-moment need when there is a gap.”

She elaborates: “ Be cautious about solely looking for the right skill set. Some additional questions to ask: Have we prepared the person to step into the role? Look deep into their skill set. You should know whether they will be successful or not.  Set them up for success: Does an internal candidate have both technical skills and the right personality traits to be an effective leader of people? When recruiting, we always use the job description, but we also need to evaluate non-tangibles. How will an internal candidate engage with internal and external customers? Go through the same rigorous, objective screening and selection process with internal hires as you would with an external hire. And at the end of the process, be honest if the selection went a different way; this is critical. You need to let your internal candidates know how to continue their own development plans. What could they do to improve their promotion chances next time?”

While internal candidates who do not receive promotions do, unfortunately, sometimes leave for other opportunities, it is a gesture of incredible goodwill and good faith to end this phase of the hiring process with a career development plan. Emphasize their continued success is important to the company; continue to discuss career pathing. Regular honest conversations with talented employees about their future opportunities for growth and development within the organization can help, even when another candidate is chosen. Continue cultivating the future of your own garden from within.

What if it doesn’t work out?

If the worst happens, and an internal promotion doesn’t work out? Communication is important.

Most times, individuals in such situations already know they are in over their heads and are relieved when the conversation comes.

So when it’s time, steer it in a productive direction: Here is the situation, here is the concern, here are possible solutions.

Situation: The hire is not working.

Concern: You do not want to lose the employee, but the situation cannot continue.

Solutions: Can they be further trained? (Do they want to be trained?) What is best for them and the company in the long term? What needs to be done? Development? A step sideways?

These discussions are always painful. There is no easy way to say it. But they can be handled with as much compassion as possible and if they are handled well, relationships and talent can be salvaged.

At the leadership level, of course, the cost of the wrong decision is even more costly.

If you are unsure how to approach a new vacancy, you may consider bringing in an experienced interim executive to shadow, mentor, and support a newly promoted leader. Set the individual up for success at the beginning by bringing in an outside perspective, tool kits, resources, and coaching as needed. We call this Development Shadowing. It provides critical training and support on the job and an extra set of hands to get more done out of the gate.

A leadership gap can be scary. It often feels like standing on the edge of a cliff with a forest fire behind you, not knowing whether to try to jump to the other side or try to free climb down with your bare hands.

Either way, there are more options and solutions than ever today that can reduce the risk of promoting from within or bringing in new eyes from the outside, on an interim, part-time, fractional, project, project-to-perm, or full-time hire basis.

To learn about how Cerius Interim Management can help you, please visit our home page by clicking here.