When looking at succession planning, companies have to determine whether to focus on growing and developing internal candidates or recruiting external candidates. Often that determination is the result of an assessment of the company’s bench strength.
Growing Internal Succession Candidates
For companies that have solid, capable young leaders, grooming and developing those candidates is most likely the best succession planning alternative.
Advantages of Developing Internal Candidates
- The company has a track record of these candidates and knows how they have performed in their positions with the company.
- The company can track the candidate’s growth and development.
- The candidates are indoctrinated in the company’s culture. They better understand what the company stands for and what its operating principles are.
- It is generally cheaper to grow internal talent than to recruit and train external candidates.
Hiring from the Outside
There can be times when the collective talents and competencies of an organization’s current team do not match up with its future succession plans. Also, smaller companies sometimes cannot afford to “buy bench strength;” i.e., they just don’t have the capital to invest in and maintain a workforce of the size that will produce a significant number of future leaders. In these cases, hiring external candidates is the necessary approach.
Advantages of Hiring from the Outside
- Externally hired candidates can bring fresh ideas and new approaches that the company may have not considered before.
- A company can recruit for specific capabilities and talents that match its organizational needs rather than trying to grow those talents internally over time.
- External recruitment can stimulate an otherwise stagnant organization. Even successful companies sometimes can become complacent, and external candidates can bring new energy to the organization.
Whether your plan is to develop talent internally, or hire from the outside, the critical issue is to continually evaluate and plan for the future needs of your organization.
Has your company begun the succession planning process? Share in the comments.