Talent At Work: Recruitment and Career Blog

The Case for Internal Hiring

Posted on August 23rd, by Lougie in HR Management, Human Resources, Recruitment. Comments Off on The Case for Internal Hiring

Media Coverage:

BC Business Valerie McTavish| August 6, 2012

The ideal job candidate is probably already working for you, so it pays for
companies big and small to develop talent within.

A full-colour projected image of Mickey Mouse is the first thing a
visitor sees when stepping off the elevator at the offices of Disney
Interactive Studios in Kelowna before being greeted by receptionist
Shannon Sawatzky whose official title is facilities services
coordinator. She has held the job for a few months now but this wasn’t
her first position at Disney Interactive.

Sawatzky has been with the studio, where the kids’ online social community, Club
Penguin, is created, since 2009. She landed her new position thanks, in
part, to the company’s efforts to train and promote internally whenever
possible. Lynn D’Albertanson, who handles communications for Disney
Online Studios, the division of Disney Interactive responsible for Club
Penquin, says there are multiple benefits to hiring from within.
“Product knowledge is probably the biggest. The Club Penguin brand is
really unique,” she explains. Her passion for that brand percolates up
as she describes it. “It’s very special. People who work here are
extremely attached to the brand and that is something that takes time
to build.”

Finding the Perfect Fit

A fit with company culture is the reason most often cited for hiring from
within. Although the term is used almost universally in HR circles, “culture fit” is as unique as each business, whether it’s big or small.
For CEI Architecture Planning Interiors, which has fewer than 100 employees in
its three offices (Vancouver, Victoria and Kelowna), it’s defined by a
positive outlook, a desire to work with others and to mentor or be
mentored along the way. Telus describes its culture as teamwork,
innovation and community mindedness. At Disney Interactive Studios it’s
an honest love for all things Disney, and behaving in a way that is
conducive to a kid-centric company. Simply put, “You wouldn’t walk into
a room here and hear foul language,” explains facilities services
coordinator Shannon Sawatzky. She’s seated at a table in the middle of
a busy lunch room at the company’s Kelowna offices, and a closer ear to
the buzz of the room backs that up; only chipper chatter, no cursing.

However, HR experts caution that just because a current employee fits the
corporate culture, hiring from within does not necessarily guarantee
the person will succeed in his or her new position. Cissy Pau of Clear
HR Consulting notes, “The issues tend to be with their colleagues,
where the people who report to them don’t see them in the role of
manager or in this new role because they’ve always seen them a certain
way. Or they end up butting heads with their managers, their owners and
the executives because they are not able to adapt.” Both Pau and Henry
Goldbeck, of Goldbeck Recruiting in Vancouver, agree that support in
the new role, proper training and open communication lines are critical
for the promoted employee to be successful.

Some companies look to an external hire specifically because they are
looking for fresh ideas and innovation. It’s something that Telus HR
vice-president Richard Beed believes is a risk for some businesses:
“What happens is the culture auto-rejects that new person because they
don’t like that innovation that’s coming in.

D’Albertanson is seated in a boardroom where numerous character sketches on a
whiteboard vie with the hilly Okanagan view for attention. She believes
loyalty and enthusiasm for the brand can also help the company
innovate. She uses an internally hired project manager in the
merchandising department as an example: “Can you imagine the benefit of
having someone who works in the support department interacting with
children all day, every day, now having a say into the merchandise that
Club Penguin is creating?”

Henry Goldbeck of Goldbeck Recruiting in Vancouver believes that hiring
from within is now a universal trend with both large and small companies.
“Larger companies have very established processes where positions
are posted internally, even when management knows or is pretty certain that
there is no internal candidate. They still post it and allow people to
he explains.

It’s more than just good optics or popular policy; hiring from within offers
a long list of benefits to the employer. Goldbeck rhymes off a few:
product and company familiarity, corporate loyalty and employee morale.
Yet it’s the “known entity” part of the equation, often described as
“culture fit,” that proves to be the most important with HR
professionals. Culture fit is a big part of what the hiring committee
attempts to assess: will this person’s values match the company’s, and
will they conduct themselves in a way that meshes with the culture it
has created? With an internal hire, the employer has seen these
behaviours in action and can be more assured that the person is a fit.

At Telus Corp., the right fit is the first reason the company gives for
hiring from within. Richard Beed, vice-president of talent solutions at
Telus, believes finding that fit does more than create a good employee.
“We absolutely find that when you are investing in somebody with that
right culture fit, that when they operate in the right environment and
with other individuals with the right culture fit, that’s what really
helps us drive the innovation. That’s what really helps to support our

Despite her recent promotion, Sawatzky knows firsthand that hiring internally
isn’t necessarily always the right decision. She was passed over the
first time she applied for her current position in favour of an
external hire. Despite Disney Interactive’s strong belief in hiring
internally and despite there being several internal applicants, when
the reception position needed to be filled in 2011, the company chose
an outside candidate. The successful applicant had the right
disposition, experience and fresh ideas about new systems to implement.
Sawatzky reflects that when she got the news, she and a few other
internal candidates were disappointed because they knew that the
company wanted to hire internally. “But, I think after probably a week
or two of getting over myself, I got to know the new receptionist,” she
says, “and without a doubt, 100 per cent agreed that they should have
hired her.”

Letting down internal candidates can be a tricky part of the process for the
employer. “The biggest challenge we face when trying to hire internally
is that everybody desperately wants it. And not everybody can have it,”
says Disney Interactive’s D’Albertanson. She feels the key is
communicating with staff: “We rely on our managers to help coach people
toward what they want to do, as in, ‘Don’t just apply for every posting
that comes out. You need to be thoughtful and you need to pay
attention. You need to talk to different people in the studio and
really see what you might be interested in so that you can have a
career path goal and shoot for that, rather than just shoot for
anything that is a salaried position.”

Disney Interactive also invests in training its staff and giving them an
opportunity to try out different positions with a backup program.
Whether it’s someone with design as a hobby providing backup support
for the engagement department when Club Penguin designers are too busy,
or heading a meeting to practice leadership skills, staff are offered
various opportunities. Not only does this benefit team members, but
management also gets a chance to see them in different roles and
perhaps in a different light. Disney Interactive has also recently
started a mentor-ship program to give staff members access to the
knowledge base of more senior staff. It’s all part of their effort to
hang on to the employees the company has and as a medium-sized
business (with between 300 and 500 employees), a comprehensive system
like this makes sense.

The challenge of upward mobility

For smaller firms, giving staff growth opportunities can be a bigger
challenge. With little to no upward mobility, small businesses can get
caught in a frustrating cycle of training junior people and then
watching them leave once they have sufficient experience. “You’ve
basically trained them up so they can join another company and be 100
per cent effective at another company,” Cissy Pau of Clear HR
Consulting explains, adding, “If they’re now 100 per cent effective at
your company, if there is some way that you can keep them for one, two
or three years, or for many more years, that’s when they are going to
be adding the most value to the organization. That’s the gravy.”

It’s a challenge CEI Architecture Planning Interiors was facing about eight
years ago. The company would hire young architects and technicians
fresh out of school, train them for a few years and then, because there
were no opportunities within the company, they would leave. Bill
Locking, one of the founding partners, was concerned not only about the
immediate impact of departing staff, but about the future of the
company. “I think seven or eight years ago we realized that at some
point in time we wanted to turn the firm over to the people we were
growing within the firm,” he says. “And at that particular time we
realized that a couple of senior people had left because they just
didn’t see the opportunities within the firm. So, we said, “We have to
do something about this. We have to keep people that we trained and
taught and mentored.”

On the advice of a business coach and an HR expert, Locking and his
partners decided to both grow the business and create a strategy for
retaining talent by introducing a partnership-track program. Now each
architect and technician that joins the firm has the opportunity to
become first an associate partner and then a partner at CEI, if they
meet about 30 points on a criteria list. Enumerating criteria such as
managing projects, bringing in new work and fostering client relations,
the checklist is a transparent way for even the most junior person to
see the path to success at the firm. And, with these measured and
attainable goals set out in front of them, it’s also the carrot that
keeps talent moving the firm forward.

Pau believes these types of programs are critical for businesses of all
sizes. The smaller ones, with limited resources, need to get creative
in training and developing employees. For example, if attending a
conference is not in the budget, she suggests having the employee
submit a proposal to speak at the conference. “It’s killing two birds
with one stone,” Pau says of the opportunity to attend the conference
and create profile for the company while at the same time grooming the
employee for a more senior position.

Pau believes that while it can be hard for small companies to develop
employee-advancement programs, they can sometimes be the best place for
employees to become well rounded because they get more hands-on
exposure to a variety of skills and functions. To ensure that employees
are given the opportunity to grow, she suggests talking with them to
find out what drives them and then giving them on-the-job training that
relates to their ambitions.

Recalling a survey she recently conducted with one client company, Pau notes that
“one of the things that came back over and over is that it all starts
with on-the-job training.” Such training can be as simple as job
shadowing or assigning a new task with the guidance of a mentor.
“Sometimes you get so many more opportunities,” Pau says of working at
a smaller company, “because there aren’t layers and layers of people
who can do the work. There’s just you and your team and you might not
have had the experience of doing it before, but someone has to figure
out how to do it.”

Goldbeck agrees that small businesses need to present unconventional training
s. As a small company of six to eight employees, his
firm has no formal training policy, he says, but “we have a lot of informal
training.” Goldbeck says a commitment  to training and a policy of
always trying to hire from within are huge selling features for a
company during the recruiting process. He notes that if he can tell a
candidate that the company has a history of promoting from within, that
makes the job that much more attractive

Telus has a variety of programs to attract top talent, including formal
programs for management, along with less formal mentoring and coaching
opportunities. It also has an online database of job descriptions,
known as the Portal, where employees can see what any job in the
company entails and what the path to that job might look like. “Say
that you want to become a sales director,” Beed says. “This is what
other people have done to get there and these are the differing
experiences that you need to have to help make you that rounded person
to fill that role.” It’s all a part of giving motivated employees the
tools they need to grow with the company, Beed explains. “What we want
to ensure is that it’s easier to find a job internally than it would be
externally,” he adds. Telus backs this up with a company-wide target to
fill 60 per cent of its positions internally.

Retention is the name of the game and it’s what HR professionals need to be
focusing on for the future, according to Pau. “Demographically
speaking, I think companies are going to have a harder and harder time
finding talent because of retirement and fewer employees in the
workplace,” she explains. It’s why she believes now is the time to
create career-path programs like Telus and CEI have done, or to invest
in mentoring and training programs like Disney Interactive and Goldbeck
have done, which help attract and keep talent. “The concept of internal
hiring and promotions from within, and mapping a career path internally
– that’s certainly one of the really critical areas when we are talking
about retention,” says Pau.

It was the training, coaching and the promise of opportunity that kept
Sawatzky at Disney Interactive, even after she was turned down for the
receptionist’s job the first time. She thinks back to that sad time
with a surprising grin: “My manager came and talked to me and just kind
of explained this is why we went the direction we went; this is why we
weren’t able to hire you this time, but this is what you can work on in
the future.” Sawatzky took that advice and took advantage of the
programs in place. Not only was she learning on the job through the
company’s formal backup program, where she filled in at the front desk,
but she also took advantage of management’s offer to help her improve
the assertiveness issues they’d noted as a shortcoming. “I started
taking on different roles and different tasks, which essentially helped
me build up my assertiveness,” she says without a hint of shyness. “So
when this position opened up again, it was a little bit different. I
applied for it and they were able to look at what I had done working
towards a different position and say, “Yep, Shannon’s ready; let’s take
her on.”

What happened to the other receptionist to create this opening after just a
year? She was promoted internally, of course, to a position with Disney
in Toronto.

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