Internal and external recruitment both have advantages and disadvantages

Introduction

An organisation's most significant asset is its people. An organisation getting the right people who have the right skills in the right positions makes the difference between your organisation being successful or unsuccessful. (http://www. emeraldinsight. com/journals. htm?articleid=1463648 &show=html) Recruitment is the method of finding and drawing possible job candidates capable of effectively filling the work vacancies available in a organisation. (Bartol et al, . 2000)

The ever growing globalisation of the marketplace combined with increasing shortage of skilled staff and the progress in technology have led to new recruitment practices. (Aswathappa, 2005). The human resources department plays a key part in finding the best applicant to fill the vacant position thus HR holds key responsibility in an organisations success or failure.

Recruitment plays a key part in virtually any organisation and there were big headlines before related to the such as Alexander Trotman who became CEO at Ford Motors. (Chan, 1996)

From the above mentioned it can be uncovered that recruitment is an essential aspect in an organisation. This essay outlines the advantages and disadvantages of both internal and external recruitment. In addition, it looks at the different times the organisation uses these strategies. Further it will discuss which strategy organisations prefer when recruiting employees. The essay ends with a conclusion that includes both sides of the strategies.

2. 0. Internal Recruitment

Internal recruitment is promoting existing employees in conjunction with internal training. (Bartol et al, . 2000) Internal recruitment is a strategy that many organisations adapt.

There are range of reasons as to the reasons organisations prefer internal recruitment; the most often explanation given is specific human capital concern. It really is an established finding in human capital theory that build up of firm-specific human capital usually occupies combined investment by both the employer and the employee, therefore both parties possess the intention of keeping and maintaining a permanent 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 much better than a preexisting worker within the setting of the organisation therefore the organisation would prefer recruiting internally. (Becker, 1975)

Another explanation is that the employees that are already in the organisation their ability can be viewed with less noise than that might be of recruiting externally. This might suit the employers that are risk-averse, those that would like to select a less uncertain applicant by endorsing qualified prospects from within. Even though specific human capital is comparatively unimportant and reliable data about external individuals can be gathered, employers tend to prefer internal candidates. That is very true especially in large businesses with bureaucratic structures and institutionalised career ladders. Organisations tend to recruit externally when a prospect shows a momentous margin of superiority, only then will an existing employee is passed by for promotion. (Chan, 1996)

A report on internal versus external recruitment states: "A cursory check of the record reveal that between the 84 chief executives of the fortune 100 businesses who had been promoted to the positioning since 1984, only 11 were recruited from outside the organisation". (Chan, 1996) This observation clearly shows that within the most notable leading large organisations there is a widespread phenomenon also within many non-profit organisations that they often promote from within their own organisations to fill the higher controlled positions rather than recruiting externally. (Chan, 1996)

Other benefits of internal recruitment include: allows organisation to create strong loyalty within the organization as it offers employees the chance to self develop and feel valued by gaining promotion. Candidate is familiar with the organisation which means opportunity of the failure will not be an issue as well. Internal recruitment also allows organisation to react to labour turnover in a quick efficient manner and also avert a leadership crisis internally. (Perrett, 2010)

A lot of organisations prefer internal recruitment but some tend to much less this strategy has its drawbacks as well: this strategy needs strong management from the HR department as recruiting internally can result in the conflicts within the organisation therefore HR department must have the ability to act as a strong facilitator. Another disadvantage is internal recruitment can direct a lot of problems when the applicant originates from another department. Not bringing new skills and fresh ground breaking ideas and competencies to the organization is another downside to this strategy. (http://hrmadvice. com/hrmadvice/hr-processes/recruitment-and-selection/internal-or-external-recruitment. html)

3. 0 External Recruitment

External recruitment involves recruiting suitable applicants with relevant experience and qualifications who have not previously worked within the organisation. (Bartol et al, . 2000) External recruitment has been adapted by many organisations but a significant consideration is the sort of job role that needs being undertaken. "External recruitment strategies would include newspapers, magazines advertising, the utilization of employment agencies and executive search firms. New strategies that are becoming popular in the work seeker market include job/career fairs and e-Recruiting. " (Richardson) These External recruitment strategies have its benefits and drawbacks that are outlined below.

External Recruitment brings new people with fresh and ground breaking ideas to the business; they'll also bring experience they may have gained from other organisations, which can be an enormous benefit for the business. An example of a complete changeover was of Selfridges where they eliminated all the old managers whose management style was based on old traditional approach, they were replaced by new young innovative women who changed the original approach to a more modern day method of business. It includes made Selfridges one of the most successful retailer in the UK today. (Soomro, 2008) External Recruitment also allows the organization to be selective when selecting a candidate and allow these to define the right requirements, which ties in the business most effectively.

Other obvious advantages include: external recruitment can save alot of amount of time in many situations mainly when the job market is filled with potential 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 competition found in their daily running of the business. Fill leadership gaps; they could not have anyone suitable enough on the organisation therefore recruiting externally would immediately fill in the positioning. (Perrett, 2010) Another benefit of recruiting externally through media and employment agencies is that the organisation would reach a wider audience and for that reason attract more prospects and have the ability to pick the best potential candidates. (http://www. articlesnatch. com/Article/Internal-Versus-External-Recruitment---Which-Is-Best--/793181)

On the other hand the external recruitment has its downsides such as it being an expensive process and requires a lot of energy from the HRM department to handle all the actual 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 absolutely no assurance that the results will be fitting with the organisation; the organisation may hire a a person who might show plenty of potential in the recruitment process but fails to live up to the work role once employed. (De Varo, 2008)

4. 0. Overall concept of both recruitment strategies

Having looked at both types of recruitment strategies it can be said that organisations do adopt both types but tend to favour internal recruitment over external recruitment. Saying this factor to consider is the kind of vacancy that will be occupied. Generally a senior managerial or executive vacancy is filled internally and organisations usually do not recruit externally as they find attaining someone within the organisation who is acquainted with the role and the organisation will occupy that job effectively. Organisations can decrease the risks and high costs when recruiting by preserving a small cadre of full-time, everlasting employees and meeting an unexpected dependence on staff by using ad-hoc personnel who are already trained.

5. 0. Conclusion

The essay looked at several important issues associated with recruitment. Both strategies of recruitment: internal and external were viewed. Benefits and drawbacks of both types of strategies were looked into and found that most the organisations preferred internal recruitment strategy in comparison to external recruitment strategy. The features of internal recruitment: human capital concern, employee having organisation knowledge, being less time-consuming, these outweighed the benefits of external recruitment. Having looked at the advantages a consideration to use is the fact that recruitment would rely upon a person organisation, some organisation have that psychological effect drilled in that they'll try recruiting internally and there latter is always to recruit externally. Saying this, the essay concludes that both strategies remain adapted available world today and everything is determined by the organisation itself and what kind of position is going to be filled.

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