Over two thirds of Canadian companies look for outside talent when recruiting for management positions, a new survey has found.
The chief financial officers of the firms taking part in the survey, developed by Robert Half Management Resources (RHMR), an international provider of senior-level finance and business systems professionals, reported that on average 29 percent of management roles in their departments are filled by internal candidates.
David King, president of RHMR in Canada, says the reason more Canadian firms recruit from outside could be attributed to poor succession planning.
“We always hear from clients that they recognize that succession planning and having a proper strategy for succession planning is important, but it often gets bumped down the priority list because other things are more pressing,” King says.
“So the challenge is when an actual opening occurs … quite often there’s sometimes a lack of awareness as to who internally is available to do those roles.”
Another contributing factor, King adds, is that some companies don’t consider future opportunities when hiring new staff for a certain position.
“So there may not even be the talent available within the company to take on a promotion to a new position.”
A similar study done by RHMR south of the border shows that U.S. companies do more internal recruiting compared to Canada, with companies reporting an average of 38 percent of positions within their finance and accounting departments filled by candidates who were promoted from within.
King says recruiting internally would raise employee morale and job satisfaction.
“People would feel much better if they had the opportunity to work within the organization and still advance their career. So employee satisfaction and engagement would likely be a benefit,” he says.
It would also translate into cost savings, he notes, as having to go outside the firm to recruit new people would be more expensive.
However, looking outside the organization for talent also has its advantages, King says, as firms can benefit from new ideas and different approaches that new people bring in.
“If you have somebody coming from outside, arguably you also get a fresh perspective and a different opinion and a different way of dealing with problems and issues, and so there’s a benefit to either scenario.”
King says that when looking to hire for a critical position, companies should consider both internal and external candidates to find the best fit.
“Even though there may be an obvious successor internally, it’s important to be objective about whether that person truly does meet the perspective and the role, and ensure they’re able to fulfill the role,” he says. “If they’re not, then I think it’s wise to still consider the external market.”
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