Internal or External

Should You Hire an Internal or External Candidate? Here’s the Surprising Answer

Before you make your next hire, read this.

By Ashley Keating

When a position opens up in your organization, you have two ways to fill it: with an internal or external candidate.

Can’t decide? Just go with who you know, suggests research from Michigan State University. Not only is the in-house option likely to cost less, but they’ll also do a better job for longer.

In the study, internally selected managers demonstrated higher customer service and more effective managerial methods than those hired from the outside. When the scientists analyzed the data set, they found internal hires were still outperforming externals after three years—and forecasts predicted the trend would last until around year 7, when both bosses would hit the same level of performance. 

The takeaway? Continue to develop your internal talent. Their institutional knowledge and organizational fit will keep paying off for years to come.