Table of Contents
“Inside first hiring,” commonly referred to as internal hiring, is one of the most effective hiring methods frequently used by companies and organizations. It boosts workplace morale, increases efficiency of performance, and simplifies assessment processes. Leadership of companies and firms should be aware of differences between internal and external hiring in order to employ suitable workers and develop efficient hiring policies appropriate for their establishments. The current paper aims to conduct a systematic literature review and investigate the estimations of researchers regarding the link between internal hiring and employee motivation. In other words, this section will gather research evidence and synthesize available data of whether internal hiring boosts employee motivation.
The Link Between Internal Hiring and Motivation
While it is commonly known that poor recruitment strategies and decisions within companies put at risk healthy organizational performance and limit great achievements, firms should design, manage, and develop new and more reliable hiring strategies. Roach and Dixon (2006) explore positive impacts of hiring internal employees on organizations and workforce. The researchers claim that internal hiring provides tremendous benefits to organizations. The reason is that it considerably limits the pool of available job applicants, maintains and keeps quality employees, and completely avoids the gamble of employing total strangers who lack experience and skills (Roach & Dixon, 2006). Moreover, internal hiring is one of the simplest and most convenient hiring tools that ensure a unique opportunity for hiring managers to avoid unnecessary external expenses for costly advertisements and save time. It does not require tiresome adjustment periods to give the chance to strangers to accumulate to new working environment and atmosphere (Roach & Dixon, 2006).
However, Roach and Dixon (2006) convince that internal hiring boosts employee motivation and increases satisfaction. Similarly to the internal promotion, it encourages and inspires every enthusiastic and hard-working employee to be distinguished by the leadership, accumulate experience, and develop a variety of vitally important skills and characteristics. These actions are performed in order for an employee to be rewarded with better position within the company (Roach & Dixon, 2006). The main message of Roach and Dixon (2006) is that the phenomenon of internal hiring is directly linked to employee motivation because it creates new vacancies that attract attention of workers within a particular company or firm. According to statistical data, “internal employees” are ready to outperform and work with the increased effectiveness in case they are promised promotion in the future (Roach & Dixon, 2006). In other words, the researchers provide convincing arguments that possible promotion prospects within companies motivate employees to contribute to organizational growth and development. Thus, internal hiring is of utmost importance when motivation of employees is under question because it influences and shapes ambitions, skills, values, and work attitudes of every employee (Roach & Dixon, 2006).
Li (2015) explores the impacts of internal hiring on motivation and satisfaction of Nestle employees. The researcher agrees with the claims of Roach and Dixon that internal hiring and promotion contribute to employee motivation and inspire them to perform with the increased efficiency (Li, 2015). Despite the fact that external hiring offers a variety of important benefits and opportunities tocompanies, internal hiring possesses a tremendous motivational fit for employees who are reluctant to work and satisfied with their current position within the company (Li, 2015). The author of the research about the link between internal hiring and motivation of Nestle employees provides evidence that the failure rate of external hiring exceeds 22% while the one of internal hiring is equal to 10-14% (Li, 2015). The statistical data serve as a bright example that internal hiring is more desired and safer option for many organizations since it inspires employees to feel valued and increases their motivation (Li, 2015). In addition, the researcher emphasizes that companies that do not practice internal promotions and rely solely on external hiring make their employees feel “outsiders” who do not contribute to organizational excellence (Li, 2015). In order to maximize employee motivation, companies should follow five main steps when hiring internally. They include effective recruitment planning stage that encompasses both organizational and administrative issues; development of effective strategy where attention is focused on the search of suitable applicants; search for skilled and experienced internal candidates; development of a reliable system in order to make the transition process smooth; and consideration as well as objective assessment of all legal issues. Li (2015) is deeply convinced that companies and organizations should develop and adopt effective internal recruitment policy because it encourages employees to develop technical expertise and numerous positive communicative skills that contribute to the generation of fresh and innovative ideas (Li, 2015).
Internal applicants for better positions should be attracted because this method of hiring contributes to employee satisfaction, motivation, and morale (Juhdi, Pa’wan, Othman, & Moksin, 2010). It is critically important to stress that nothing is more disappointing for employees than being aware that the company does not consider internal applicants as suitable candidates for promotion or new position. Juhdi et al. (2010) explore the main benefits of internal and external employability. They assure that internal hiring influences both organizations and employees because this mode of employability drastically decreases expenses of companies needed for training and acclimation of external employees. In addition, it contributes to developing specialist expertise and skills, balances organizational investment, and increases willingness of internal candidates for a new position to contribute to organizational growth and provide better results (Juhdi et al., 2010). Moreover, the researchers share the views of many other proponents of internal hiring and claim that this method of employability focuses on internal applicants. It is effective because it increases self-esteem, self-confidence, satisfaction, and motivation of employees (Juhdi et al., 2010). Many researchers who explore the issues of internal and external employability claim that internal applicants are usually more biased, and this method hinders organizational effectiveness and productivity. However, it motivates employees to bring revolutionary ideas to organizations and excludes unproductive influences of coworkers as everyone expects promotion. In addition, this method increases the potential of internal applicants and encourages them to pay attention to personal growth and professional development (Juhdi et al., 2010).
Internal hiring is considered the most effective practice that enables companies and organizations to recruit or promote the right talent. Verhoeven and Williams (2008) investigate advantages and drawbacks of Internet recruitment as one of the main types of hiring. They claim that motivvation of the workforce is one of the most significant benefits of hiring internal candidates contrary to external employability (Verhoeven & Williams, 2008). Researchers emphasize that internal recruiting increases motivation of the workforce, inspires them to develop new skills and enrich their knowledge. It gives them an opportunity to advance, develop, and try on new roles and responsibilities within the company (Verhoeven & Williams, 2008). However, the authors stress that internal hiring may also have a negative impact on employee motivation because it usually does not consider all employees as perfect candidates for a new position. Nevertheless, internal hiring boosts motivation as it increases competition among candidates (Verhoeven & Williams, 2008).
DeVaro and Morita (2009) examine the phenomena of internal promotion and external recruitment. The researchers argue that companies and organizations should be committed to internal recruitment because this employment strategy considerably enhances motivation of employees and increases profitability (DeVaro & Morita, 2009). Strategic internal hiring and promotion contribute to development of new skills, capabilities, and practical experiences of the workforce. Researchers provide convincing arguments that companies should not limit their hiring to employing from the outside because internal applicants usually possess more experience and knowledge. It decreases the need in expensive, long-term, and exhausting training of external candidates for a new position (DeVaro & Morita, 2009). In addition, internal hiring decisions result in the most positive and beneficial outcomes for large companies in which the number of candidates is significant. Therefore, when hiring internal candidates, hiring managers have an opportunity not only to review their resume and listen to their successes during nerve-wrecking job interviews but also to analyze and evaluate their previous achievements and failures (DeVaro & Morita, 2009).
Finally, Bidwell (2011) compares and contrasts the benefits of internal and external hiring. The researcher heightens the increased need in internal hiring because promotion of an internal applicant serves as an informal job reward. Consequently, it motivates and inspires other employees to focus on continuing learning and life-long development in order to follow the same path and be promoted in the future (Bidwell, 2011). The author summarizes that internal movers perform with increased efficiency, are willing to be more adaptable and flexible, more mobile, manifest their leadership traits and skills, and focus on employee interactions and supportive communication (Bidwell, 2011).
Having analyzed and evaluated research findings regarding the influence of internal hiring on employee motivation, as recently this topic became of paramount importance, it is possible conclude that the role of internal hiring is crucial as it maximizes employee motivation. Moreover, the data obtained suggest that internal employment and promotion are critical processes in the modern competitive business world because they foster the development of specialized knowledge and accumulation of practical experience among internal candidates. The internal hiring and promotion are the most reliable ways to encourage and increase motivation because when employees do not notice prospects or opportunities of advancement, they will not make effort to reach organizational excellence. The obtained findings are of direct practical and theoretical relevance and will be applicable to further investigations associated with positive impacts of internal hiring and promotion on organizations and employees.