MGT804 Leadership: Internal and External Recruitment Analysis

This essay provides a comprehensive analysis of internal and external recruitment methods, exploring their respective benefits and limitations. Internal recruitment offers advantages such as speed, cost-effectiveness, and enhanced employee motivation, but may limit the influx of fresh talent and create internal conflicts. Conversely, external recruitment broadens the candidate pool and introduces new ideas, but can be expensive, time-consuming, and may lead to integration challenges. The essay also examines how each recruitment type aligns with different organizational cultures, suggesting activities HR managers can undertake to determine the most appropriate method for various positions. Furthermore, it discusses the influence of internal and external recruitment on organizational performance, highlighting the roles of coaching and mentoring in optimizing employee success. The analysis draws upon real-world examples to illustrate key concepts and provide practical insights into effective recruitment strategies.

Leadership Management
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Table of Contents
Introduction.................................................................................................................................................2
Section 1 - Critical Analysis of Internal and External Recruitment...............................................................3
Benefits of Internal Recruitment.............................................................................................................3
Benefits of External Recruitment.............................................................................................................3
Limitations of Internal Recruitment.........................................................................................................4
Limitations of External Recruitment........................................................................................................5
Section 2 - Advanced Knowledge and Critical Understanding of Internal and External Recruitment..........5
Internal Recruitment and Organizational Culture....................................................................................5
External Recruitment and Organizational Culture...................................................................................6
Activities to Determine the Most Appropriate Type of Recruitment for Different Positions within an
Organization............................................................................................................................................7
Section 3 - Influences of Internal and External Recruitment on Organizational Performance.....................8
Conclusion...................................................................................................................................................9
References.................................................................................................................................................11

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Introduction
It is important for HR managers to adopt effective methods for recruiting and selecting
candidates for a specific job profile to accomplish the best possible outcomes. Recruitment
process generate positive impact on firms if HR recruits the right candidates, or it might be
detrimental if wrong candidates are hired by the HR. Most of the companies follow two basic
processes; internal recruitment and external recruitment.
Internal recruitment is a set of methods by which a firm chooses a candidate from the existing
pool of employees. It is the procedure of attracting and recognizing the job candidates from
within the firm. External recruitment is a recruitment method of recruiting job candidates from
an outside pool of candidates rather the current pool of employees those who are operating in a
company. Internal recruitment occurs in the forms of promotions, transfers or recruiting retired,
retrenched employees or relatives of disabled and decreased staffs. External recruitment takes
place through internships, media advertisements, external outsourcing, employment agencies, job
fairs, unions, and other trade agencies or campus recruitment.
The essay will critically analyze the internal and external recruitment, along with the benefits
and limitations of both types of recruitments. It will evaluate the advanced knowledge and
critical understanding of internal and external recruitment. It will also discuss the activities for
determining the most appropriate type of recruitment for different positions within an
organization. Moreover, it will also explain the influences of internal and external recruitment on
organizational performance.
Figure: Internal Recruitment and External Recruitment

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(Source: Bidwell & Mollick, 2015)
Section 1 - Critical Analysis of Internal and External Recruitment
Benefits of Internal Recruitment
The advantages of internal recruitment are as follows:
1. Internal recruitment is easy and quick recruitment process as the firms are already familiar
with the working ethics of the recruiter. The firms know the strengths and weaknesses of
their staffs rather than external job candidates (Bartlett, Kremin, Saunders & Wood, 2015).
For example, Vodafone New Zealand realized that some of its staffs are so talented that they
could do better if they are transferred to other positions or given promotion, and thus, the
firm conducted internal recruitment.
2. In this recruitment, the firms do not have to invest lots of money, efforts, and time for
locating and attracting the likely job candidates. Therefore, it can be said that this recruitment
process is economical or in other words, inexpensive.
3. If the firm recruits an existing staff, the employee will already be familiarized with the
operations of the firm. For example, when the Vodafone New Zealand announced for some
new vacancies for the firm, some of the internal staffs applied for that vacancies as they
already knew about the job requirement of the vacancies and working conditions of the
company.
4. This type of recruitment provides more opportunities for the existing staffs in the firm that
could be motivating and support with retention. It ensures that the company prefers its
employees than external job candidates. For example, as Vodafone New Zealand knows the
skills and capabilities of the potential candidates and new internal recruitment was conducted
by the firm to retain some of its internal employees.
Benefits of External Recruitment
The advantages of external recruitment are given below:
1. External recruitment provides a large pool of candidates than sourcing from within the firm
and increases the possibilities of choosing the best employees. For example, the external
sources of Air New Zealand helped the company to bring a large pool of candidates and
provided freedom to select suitable candidates.

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2. This type of recruitment recruits external candidates with diverse backgrounds and they offer
fresh ideas and strategies to the firms. For example, a large pool of candidates, it became
possible for Air New Zealand to recruit capable candidates from external sources.
3. The external job candidates are assumed to be more efficient and skilled (Bayo-Moriones &
Ortín-Ángel, 2016). With this circumstance, they can work with greater stamina and positive
approach. It helps to create stiff competition and motivating work atmosphere in the firm.
4. This recruitment also helps to set up an employer brand, which helps to attract superior
quality employees. For example, online communication mediums and word of mouth about
the Air New Zealand help the organization to set up an employer brand for its reputation.
Limitations of Internal Recruitment
The disadvantages of internal recruitment are as follows:
1. This type of recruitment also restricts the freedom and options for the firms to choose
suitable candidates for the vacancies. For example, internal recruitment in Vodafone
narrowed the base of its employees, and compromised with the skills and abilities of the
employees due to internal recruitment.
2. Internal recruitment confines the recruitment of fresh talents within the firms (Bills, Di
Stasio, & Gërxhani, 2017). It leads to the denial of talents available in the vast labor market
outside the firms. For example, some of the internal staffs of Vodafone were either
transferred or promoted to other posts, but they continued working and behaving in the same
methods without any enthusiasm.
3. In this recruitment process, the internal candidates are secured from the competition by not
providing opportunities to the other experienced candidates from outside the firms. In turn, it
leads to a tendency in the staffs to get promoted without demonstrating their better
performance.
4. With the feeling that the internal employees would undoubtedly get a promotion, their skills
in the longer run may get outdated or become stagnant (Bartlett, Kremin, Saunders & Wood,
2016). In turn, the efficiency and the productivity of the firms can reduce.
5. This recruitment can lead to conflicts among those staffs who hope for promotion to the
available vacancies. For example, transfer and promotion through internal recruitment led to
conflicts in Vodafone by those employees who were not given promotion and were unhappy
by the decisions.

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Limitations of External Recruitment
The disadvantages of external recruitment are given below:
1. External recruitment is an expensive process of recruiting candidates in the form of
advertisements for vacancies, hiring, and selecting. For example, it costs almost $15,000 for
Air New Zealand for hiring each external job candidate.
2. This recruitment is a time-consuming process of recruiting than internal recruitment. There
are possibilities of getting a vast number of applications for the post, and so the recruiter has
to be extremely careful while deciding to select the best candidate for each round of the
selection procedure. These rounds of selection take a long time than the process of internal
recruitment since it includes several procedures. For example, Air New Zealand took nearly
40 days to recruit an external job candidate.
3. The candidates selected from this recruitment are from outside the firm and might not be
suitable for firms. There is a probability that the external job candidates chosen for the post
are not worthy of the offered post, and they could take benefits of their position in the firms.
For example, the external job candidates of Air New Zealand took more time to analyze the
job and also to understand the people and working culture of the organization.
4. When a firm considers a new candidate for the higher post than the current employees, then
there are greater possibilities that the current staffs of the firm may show some internal
disputes among the executives of the firm (Blatter, Muehlemann, Schenker & Wolter, 2015).
This type of internal conflicts could lead the matters to different levels, and gradually, the
firm could collapse on their back with these differences in views and ideas.
Section 2 - Advanced Knowledge and Critical Understanding of Internal and External
Recruitment
Internal Recruitment and Organizational Culture
At the present times, the organizations are preferring internal recruitment since they could
successfully recognize the skilled candidates within their firm for retaining them and getting
them in new positions where they could utilize their skills and experiences for the benefits of the
company. The organizational culture is not one-size-fit-for-all culture and the attitudes,
behaviors, and beliefs of the organization work altogether for shaping the culture of the company
(Bradford, Rutherford & Friend, 2017). Internal recruitment needs to ensure that the candidates

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also have the same attitudes, behaviors, and beliefs, and they have already proven that they are
fit for the organizational culture and thus for internal recruitment. The company knows that
working ethics and styles of the recruiting person align with the company and so the candidate
could move to the next phase of the interview procedure.
Internal recruitment helps in building a strong organizational culture that further promotes
advanced historical knowledge about the company among the staffs. This recruitment makes a
contribution in creating the corporate culture where loyalty is given importance, and the staffs
believe that they have opportunities for development. The culture motivates the staffs to
continuously develop new skills for preparing themselves for internal promotions. The HR
department has to enhance the organizational culture to create recruitment strategies which are
aware by all the staffs (Carey, Philippon & Cummings, 2017). It may consist of posting of job
vacancies in common areas that can be accessed by all the staffs, notifications by email of all the
internal vacancies or period where only internal positions are available before the starting of
external recruitment.
External Recruitment and Organizational Culture
Organizational culture is a vital aspect while looking to hire candidates externally. When the
firm employs people externally, the most significant disadvantage is that they do not know the
working attitudes, behaviors, and beliefs of that organization. External job candidates have little
or no knowledge of the organizational culture of the company, processes, and relations within the
firms (Chan, 2016). The external recruitment also has some benefits such as offering fresh ideas
and strategies to the firms and allowing the external recruiters to attract a large pool of
candidates.
There is a huge performance gap between external candidates and internal candidates since
external recruiters and HR managers depend heavily on past job experiences and job titles as
well as education. While recruiting externally, they depend on this factor instead of determining
the fact of whether the candidates would be able to perform according to the organizational
culture of the company in which they have been recruited. Working in accordance with the
organizational culture of the company includes several aspects like assessing and integrating into
the new organizational culture, effectively forging healthy relations with the new colleagues and
collecting the social capitals needed for the company (Damanpour, Sanchez‐Henriquez & Chiu,

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2018). All these aspects will determine the successful involvement of external candidates within
the organizational culture of the company.
Activities to Determine the Most Appropriate Type of Recruitment for Different Positions
within an Organization
A good recruitment is not only candidates who meet all the criteria of the job and fits in the
organizational culture. They are also someone those who will feel happy to work in the
organization and become dynamic employees. Internal recruitment is an emerging trend which
will carry on to gain momentum in the year 2019 (DeVaro & Morita, 2015). Several HR
managers consider that the teams of internal recruitment are best equipped to recognize the
characteristics which will make successful staffs for the future. There is a truth to this belief
since the internal recruitment managers have not only evaluated the organizational culture of the
company and the job descriptions but also experienced and witnessed it (Grant, 2017). The
internal recruiters are involved and dedicated to the everyday operations of the firm.
Internal hiring enables the candidates to be analyzed by the recruitment managers those who
know accurately the operations of the firms and the ways needed to make the job successful
(Jones, Woods & Guillaume, 2016). On the other hand, external recruitment managers have to
evaluate the job descriptions and depend on information given to them for understanding the
organizational culture of the company. Even if the external recruitment managers have been
working with the company for some time, they never perceive the real feeling of the company’s
operations and culture (Jones, Woods & Zhou, 2018). There are many external recruitment
managers those who will work with the same company and each manager will have their
understanding of the company.
The three factors that play a vital in making internal recruitment a sustainable recruitment
process are given below:
1. Time - If a small firm with few staffs considering to add another member in its team, then
the firm could easily tackle the internal recruitment. On the contrary, if the same firm
considering to bring a highly skilled employee, the firm may not have the time to find
suitable candidates through internal recruitment.
2. Resources - Most of the internal recruitment managers underestimate the right resources
while searching for suitable candidates. The internal recruitment managers tend to be more

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focused on processes, strategies, administration, and compliance (Jøranli, 2018). The
managers need to adapt to the digitization and evolvement of HR according to the current
conditions. Otherwise, the resources of recruitment may be inadequate for recruiting the best
candidates.
3. High Volume of Applications - The firms those who are looking for hiring employees with
same capabilities must implement Applicant Tracking System (ATS). The firms with ATS
can manage a high volume of applications, although it could be time-consuming for the
internal recruitment managers those who work on manual techniques (Keller, 2016).
Moreover, questionnaire features and job promotions will make the screening of the initial
applications much secure and the sourcing and screening procedure of the applicants could
be managed internally.
Section 3 - Influences of Internal and External Recruitment on Organizational
Performance
In internal recruitment, the staffs know that they could apply for the vacancies and manage their
career growth, and as a result, the organizational performance automatically improves (Krausert,
2017). It is fueled by the determination of the employees to deliver better performance on the
present job and also encourage the morale of the employees. On the other hand, vacancies filled
by external candidates send the message that the hard work, experiences, and credentials of the
employees are not adequate to improve the organizational performance (Waxin, Lindsay,
Belkhodja & Zhao, 2018). There is a huge performance gap between external candidates and
internal candidates since external recruiters and HR managers depend heavily on past job
experiences and job titles as well as education. The external recruitment provides a large pool of
experienced job candidates from where the recruiters select the best candidates to fill up the
vacancies. Internal recruitment provides more opportunities for the existing staffs in the firm that
could be motivating and support with retention. It ensures that the company prefers its
employees than external job candidates.
Coaching and mentoring in internal recruitment is beneficial for the organization as internal
coaches and mentors have more in-depth knowledge about the firms and their culture (Kumar &
Panday, 2018). They would be able to work more quickly, such as creating development
strategies more effectively with the available resources and improve of the performance of the

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organization and its employees. The internal coaches and mentors are able to collect feedback on
the employees and utilized it to modify the development strategies as required. The other
managers of the organization can be helpful from internal coaching and mentoring (McNally &
Lukens, 2016). The internal coaches and mentors are necessary to continuously develop the
skills and accomplish more leverages which can be beneficial for the firms to face the new
challenges and opportunities and can enhance the performance of the organization and its staffs
(Siew-Chen & Vinayan, 2016).
On the other hand, as coaching and mentoring in external recruitment is outsourced, it does not
need any extra staffs or resources. The reliability of the external coaches and mentors sometimes
might be higher as they have acquired huge experience by working in several different firms
(Milner, McCarthy & Milner, 2018). Most of the times, their roles are well-defined than internal
coaches and mentors. The internal coaches and mentors have additional duties and functions,
while the external coaches and mentors are only involved in coaching and mentoring (Rock &
Donde, 2018). Sometimes, the in-depth knowledge of the internal coaches and mentors could be
a disadvantage for the organization as they might become blind towards some aspects of the firm
and it might affect the organizational performance while the external coaches and mentors might
have more balanced and objective views than the internal coaches and mentors and improve the
organizational performance (Schalk & Landeta, 2017).
Conclusion
The essay critically analyzed the internal and external recruitment, along with the benefits and
limitations of both types of recruitments. It evaluated the advanced knowledge and critical
understanding of internal and external recruitment. It also discussed the activities for determining
the most appropriate kind of recruitment for different positions within an organization.
Moreover, it also explained the influences of internal and external recruitment on organizational
performance.
Internal recruitment is easy and quick recruitment process and not have to invest lots of money,
efforts, and time as the firms are already familiar with the working ethics of the recruiting
person. The firms know the strengths and weaknesses of their staffs rather than external job
candidates. On the other hand, external recruitment provides a large pool of candidates than
sourcing from within the firm and increases the possibilities of choosing the best employees. But

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it is an expensive process of recruiting candidates in the form of advertisements for vacancies,
hiring, and selecting.
Internal recruitment helps in building an influential organizational culture. Organizational culture
is a vital aspect while looking to hire candidates externally. There is a huge performance gap
between external candidates and internal candidates since external recruiters and HR managers
depend heavily on past job experiences and job titles as well as education. Internal recruitment is
an emerging trend which will carry on to gain momentum in the year 2019. Several recruitment
managers consider that the teams of internal recruitment are best equipped to recognize the
characteristics which will make successful staffs for the future.

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