So you're a recruiting professional tasked with rapid talent acquisition to fill multiple manager-level positions in your company. Sure, you have the same potential roadblocks of others in your position like: attracting the right candidates, engaging those candidates, and hiring fast enough to meet internal demands, but you got this. After all, you're armed with the standard digital tools of the trade: LinkedIn, Indeed and the like. But could these tools be inherently ignoring your most qualified talent pool?
It turns out quality talent acquisition is a daunting task for companies of all sizes. A recent survey by PwC showed that 77% of CEOs believe they’ll have a difficult time finding the skills they’ll need to support their growth aspirations. In addition, talent acquisition and training costs are rising, while the average tenure is decreasing. But what if your perceived talent gap isn’t a gap at all?
A number of leading companies have launched internal recruiting initiatives. Internal recruiting focuses on discovering and developing the talent within the company, versus searching externally. There are several very compelling statistics that support doubling down on internal recruitment efforts.
1. Talent Acquisition and hiring externally costs 170% more.
Recruiting outside your organization can be costly. Besides the need to retain a recruiting staff, consider the cost and maintenance of role advertisement and promotion, platform fees, travel, and the increased time necessary to triage applicants, schedule interviews, and manage paperwork.
In fact, the Saratoga Institute reports, the average cost of finding and hiring someone from outside the company is 1.7 times more than an internal hire ($8,676 vs. $15,008).
As the Society for Human Resources Professionals points out “Internal recruitments are less expensive because there are little to no recruiting fees, and they generally don't require extensive training, referral bonuses, or travel and relocation costs. Internal recruitments are also usually quicker. For an internal hire, the process may be completed within a few weeks. Internal hires usually have the support of managers and readily available performance review documents, and managers have a good sense of the strengths of the employee.”
2. Between 40% and 60% of external hires are not successful while that number drops to 25% for internal recruitment.
Candidates sourced internally are much more likely to be successful than their externally hired counterparts. According to Time Magazine, internal hires are unsuccessful only about 25% of the time, vs. 40% to 60% of the time for external hires. Performance review data aligns with this. The University of Pennsylvania’s Wharton School found that within the first two years on the job, external hires fared worse in performance reviews when compared to hires found internally. Despite this, external hires were paid 18% more on average than an internal hire.
It can be easier for employees to succeed at a new job within the same company because they have workplace connections, knowledge of company goals and processes, and understand the corporate culture.
3. You’ll develop more high performers and improve culture, while lowering attrition.
Nothing bothers employees more than being continually passed up for new opportunities inside their company. This is especially true for high performers, or the talent you most want to keep. In 2017, PwC reported that 67% of younger workers believed they were underutilized in their current role and didn’t get to do what they do best at work. The report also showed that ⅓ of these workers were planning to look for another job within six months if their existing situation didn’t improve. The HR Review said a full ⅔ of employees surveyed in the UK reported having wanderlust.
Recruiting talent internally enhances the employee experience. As SHRM.org reports, “Of primary importance… is the fact that internal recruitment is good for employee morale. If employees constantly see positions being filled externally, they may feel that they have no future at their organization and may lose motivation or resign for a better opportunity elsewhere.”
How can your talent acquisition strategy become more internal?
Most organizations lack the data and the tools to manage internal recruiting efforts effectively. Applicant tracking systems are typically focused on talent acquisition outside the organization. As a result, new jobs make their way to a physical job board in the cafeteria, the company intranet or HRIS system, or other hard-to-find spots. Worse yet, many companies leave internal opportunities up to word-of-mouth, and often leave it entirely up to the manager as to whether the role is posted internally.
Companies need easy access to relevant employee information in order to create an internal recruiting database. Rich employee profiles with the ability to search on skill sets, behavioral tests, certifications, training, past project history and awards would facilitate the identification of internal candidates. In most organizations, this data exists, but is simply not aggregated or easily accessible.
At Structural, we’re focused on helping companies bring together all the information they have on their employees to build rich profiles for everyone in the company. Armed with quick web or mobile access to this data, leaders and talent teams can find internal candidates more effectively than ever, supporting reduced attrition, decreased recruiting and training costs and an improved corporate culture. We’ve had great success helping organizations recruit internally and create more connected and productive teams. Reach out if you want to learn more about how Structural can help you with your talent acquisition goals.