“Why Companies Overlook Great Internal Job Candidates,” an article by Wade Burgess in the October 3 Harvard Business Review, explores why companies hire from the outside instead of promoting from within.

Here are three reasons that Burgess cites:

• The company culture discourages “poaching” good candidates from other departments and sectors. Managers are unwilling to let go of talented people who could move to other departments or sectors. Instead, the company hires from the outside. One result, Burgess notes, is that “an atmosphere of limitation” takes hold. Capable people give up the idea of growing in the company or doing great things.
• Hiring managers miss the fact that internal candidates have the skills they are looking for. The solution, Burgess writes, is to consider not only what an internal candidate has done, but what he or she is capable of doing. Burgess also notes that because new technical skills are needed to fill many new jobs, many companies incorrectly assume that they need to look outside to find candidates who possess them.
• Companies plan for attrition instead of training for retention. “Some companies experience such high turnover that they’ve taken to hiring only those who can be productive immediately, rather than training the workforce already in place,” the author writes.

Those Are All Brilliant Insights

Wade Burgess is global Vice President of LinkedIn Talent Solutions, and we think his observations are very wise. Why spend time and money hiring from the outside when your best candidates could already be working for you? Why risk hiring unknown new workers who might not work out, when you already know your best current employees so well?

Above all, training can play a major role in helping organizations boost retention, optimize performance, increase profits and enjoy a wide range of other benefits.