Sunday, February 10, 2013

Essay on Internal & External Recruitment (HR)


Advantages and Disadvantages of having internal & external recruitment to an organization

Internal Recruitment
Internal recruitment is promoting existing employees in conjunction with internal training.  Internal recruitment is a strategy that many organizations adapt.There are number of reasons as to why organizations prefer internal recruitment; the most often explanation given is specific human capital concern. It is an established finding in human capital theory that buildup of firm-specific human capital usually occupies combined investment by both the employer and the employee, therefore both parties have the intention of keeping and maintaining a long term relationship. Thus the longer the occupancy of the worker the further increase in specific human capital. This would mean that it would be more costly for the firm to find an external applicant who could do better than an existing worker within the setting of the organization so the organization would prefer recruiting internally.
Other advantages of internal recruitment include: allows organisation to build strong loyalty within the organization as it gives employees the opportunity to self develop and feel valued by gaining promotion. Candidate is familiar with the organisation therefore the possibility of the failure won’t be an issue as well. Internal recruitment also allows organisation to respond to labour turnover in a quick efficient manner and also avert a leadership crisis internally. A lot of organisations prefer internal recruitment but some tend to not as this strategy has its drawbacks as well: this strategy needs strong management from the HR department as recruiting internally can lead to the conflicts within the organisation therefore HR department needs to be able to act as a strong facilitator. Another disadvantage is internal recruitment can direct a lot of problems when the candidate comes from another department. Not bringing new skills and fresh innovative ideas and competencies to the organization is another downside to this strategyEasier to assess applicants since more information is available. 

ADVANTAGES
Ø Less costly and quicker than an external search
Ø Promoted employee is already familiar with organization policies, culture, etc.
Ø Signals to employees that career opportunities exist in organization
Ø Improve employee morale and organization loyalty
Ø Lower costs for some jobs
Ø Less likely to make major changes
DISADVANTAGES
Ø Narrowing of thinking and stale ideas (inbreeding)
Ø May not help turn company around
Ø Training will be needed and learning curve will occur for the job duties
Ø Internal politics will occur (e.g., possible discontent of rejected applicants; new subordinates discount new boss’ knowledge and expect special treatment; etc.)
Ø Difficult to do with rapid growth
Ø Affirmative action goals may be more difficult to achieve
Ø Ripple effect
Ø Smaller talent pool / fewer applicants
3.0 External Recruitment
External recruitment involves recruiting suitable candidates with relevant experience and qualifications who have not previously worked within the organisation. External recruitment has been adapted by many organisations but a major consideration is the type of job role that needs being undertaken. External recruitment strategies would include newspapers, magazines advertising, the use of employment agencies and executive search firms.
External Recruitment brings new people with fresh and innovative ideas to the organization; they will also bring experience they have gained from other organisations, which can be a huge benefit for the organization. An example of a complete changeover was of Selfridges where they got rid of all the old managers whose management style was based on old traditional approach, they were replaced by new young innovative women who changed the traditional approach to a more modern day approach to business. It has made Selfridges one of the most successful retailer in the UK today.External Recruitment also allows the organization to be selective when selecting a candidate and allow them to define the right requirements, which fits in the organization most effectively.
Other obvious advantages include: external recruitment can save alot of time in many situations mainly when the job market is full of prospective job candidates. Reduce training costs; as staff will bring experience and qualifications from the organisation they’ve worked at before. Gain expertise from competitors; allow organisation to gain knowledge of what strategies competitors used in their daily running of the business. Fill leadership gaps; they might not have anyone suitable enough on the organisation therefore recruiting externally would straight away fill in the position. Another advantage of recruiting externally through media and employment agencies is that the organisation would reach a wider audience and therefore attract more candidates and have the ability to choose the best potential candidates.
On the other hand the external recruitment has its downsides which include it being an expensive process and takes a lot of energy from the HRM department to handle all the potential candidates. External recruitment is also very time-consuming as the organisation works through so many processes that go before selection. Even then after going through all these processes there is no assurance that the results will be fitting with the organisation; the organisation may hire a someone who might show loads of potential in the recruitment process but fails to live up to the job role once employed.
ADVANTAGES

Ø Provides new ideas / fresh perspectives
Ø May bring new insights from other industries
Ø Initiate a turnaround
Ø Hiring experienced employee can reduce training needed
Ø Internal politics may be avoided (e.g., less upsetting to present organizational hierarchy)
Ø Allows rapid growth
Ø Increase diversity
Ø Only hire at one level
Ø Bigger talent pool / more applicants

DISADVANTAGES
Ø Less information available on applicants
Ø Search takes longer and costs more
Ø Outsider takes time to become familiar with current systems and organization culture
Ø Destroys incentive of present employees to strive for promotion
Ø Can hurt employee morale and loyalty
Ø May have to pay more for the job
Ø Current organization members may fight new ideas.



2 comments:

  1. Really nice thing. And actually this will be included with whatever they have to involve in particular actions and all. Nice and also i am expecting much more posts from you.
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  2. Nice blog post. There are lots of things which we have to make assure during the time when we are recruiting internally.

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