Because of the negative economic impacts of the COVID-19 pandemic, many companies have had to find ways to do more with less, including maximizing productivity with limited human capital. When essential roles have opened up, financial constraints have hampered HR’s abilities to bring on new employees to fill those talent gaps. That’s where internal hiring can create human capital opportunities for cash-strapped organizations.
“During lean times proactive internal placement can ensure that the redeployment of employees results in maximum productivity,” writes HR consultant Dr. John Sullivan.
But redeploying employees isn’t as simple as it may seem. “Organizations often have in place structural hurdles to promoting and recruiting from within—or a culture that discourages it,” write Robin Erickson, Bill Cleary, and Denise Moulton with Deloitte Consulting.
These seven tips can help your HR team overcome these obstacles and make the most of your current workforce during lean times.
Tip #1: Create a Culture of Inward Mobility
Company culture is a barrier to creating a successful internal hiring program for many organizations, Erica Volini, et al. write at Deloitte. Think about it. Do the managers in your organization encourage career growth for employees? Does your company provide learning opportunities for workers to advance their careers? If the answer to these questions is “no,” you are going to have a difficult time recruiting internally.
That’s why the first step is to change the way your organization views internal mobility.
That was the approach global bank UBS took after it pinpointed internal mobility as a way to build an advantage in a competitive marketplace. The company decided it needed to become one that thrived on “cross-functional moves” to get ahead of competitors, says Stefan Seiler, Ph.D., group head of human resources at UBS. Doing that required changing the company culture to one that encouraged internal mobility.
“Internal mobility needs to be very well embedded into the overall framework of the organization culture,” says Seilter. To accomplish this, UBS focused on four key areas:
- It made internal mobility a strategic priority.
- It created a culture of ongoing feedback.
- It changed its approach to organizational learning.
- It focused on line-manager effectiveness.
It was a successful approach that helped the company achieve its goal.
When internal recruitment is intertwined in an organization’s fabric, like at UBS, employees are incentivized to stay with the company. That consistency is crucial in lean times when employee turnover can be especially costly.
Tip #2: Create an Internal Recruitment Policy
The process for hiring internally is not the same as for hiring externally. The goals, plans, procedures, and candidate expectations are different, so you must develop an internal hiring policy to be included in your strategic hiring plan alongside the external hiring policy.
This policy will help HR audit the skills of employees who may be right for an opening and link those employees with the new opportunities. Ultimately, it will help ensure you are hiring the right internal employees for the right roles.
“Thinking ahead about your growth, planning for it, and then making conscious hiring choices will go a long way in developing a successful recruitment program,” says Erin Pitera, CEO at management and strategic consulting firm Federal Management Partners.
As with any strategic plan, the internal hiring plan needs to be very intentional. It should detail the role internal hiring plays in the overall strategy for company growth. It also needs to address the roles and responsibilities of managers in the process, provide details on the selection process, and outline the transition process from one role to the next.
By creating such a policy, organizations can more effectively recruit from within and build more stable workforces in lean times.
Tip #3: Audit for the Skills You Have
If you identify a talent gap or have an open position, how do you know if you have the right person already on board to fill that role? By conducting a skills audit.
A skills audit helps HR teams and hiring managers understand their people beyond their abilities to meet the requirements of their current positions. The audit provides information that tells HR managers what each employee is capable of, and that information can be used to encourage internal mobility.
By being “clear about what skills you have among your employee population and what skills the business needs,” says Ben Eubanks, principal analyst and chief research officer at Lighthouse Research and Advisory, you are better prepared to find someone in the organization to fill positions as they open up.
Tip #4: Build Career Paths to Boost Employee Interest
Employees can be nervous about switching roles within an organization, especially if they can’t envision the path forward. So, a key part of a successful internal mobility program is the outlining of career paths within the organization so employees can see the future of a new position. This also helps employees understand the skills they would need to succeed in new roles, whether they move up the ladder or laterally.
When employees can see themselves succeeding in different roles, they are more likely to apply for new internal positions. So, by focusing on creating internal career opportunities, companies can significantly reduce turnover, says Lauren Smith, VP and team manager at Gartner. This creates stability at a time organizations need it most.
Tip #5: Provide Learning Opportunities for Current Employees
Once you have identified employees who would be perfect for transitioning into other roles and you have shown them the steps in that career path, help them to develop or enhance their skills to succeed in those new positions.
Those learning opportunities can take a number of forms. Managers can cross-train employees to perform multiple roles at once before they transition permanently to a new position. Human resources teams can set up mentoring programs that connect employees with colleagues who can show them the ropes. Supervisors can provide formal training programs that nurture the development of role-specific skill sets to prepare employees for a move.
Keep in mind that learning programs don’t have to be elaborate and expensive. There is very little cost involved in each of the above-mentioned learning opportunities. The barometer of success for learning programs is whether or not employees are engaged and enthusiastic about developing new skills.
Tip #6: Post for Internal Job Openings
One of the most common mistakes companies make when trying to hire internally is not posting job openings for current employees to see. “Although many companies have adopted policies encouraging managers to post open jobs, few require it, and no state or federal laws require firms to post jobs internally,” writes JR Keller, assistant professor at the School of Industrial and Labor Relations at Cornell University.
But it’s a practice you cannot afford to overlook if you want your best talent to apply for an open position.
The most cost-efficient way to ensure job postings are visible to all internal employees is to post them on an internal message board. It’s an easy-to-update tool to which all employees have access, ensuring everyone has an equal opportunity to apply. Posting on a message board also presents employees with the ability to engage in discussions and ask questions about open positions.
Tip #7: Encourage Employees to Apply
Employer or manager support is a key motivating factor for employees who are uncertain about whether or not they should apply for an open position at their current company. Even if an employee is outstanding in their current position, managers should not only support career growth but actually encourage it. With that encouragement, employees are more likely to apply for a new position in the company.
Make sure to get managers on board with reacting positively when employees inform them of an intent to change positions. Managers should also be proactive about connecting employees with open roles that might interest them. This demonstrates to the employees that the company is invested in their success, which can lead to a longer tenure with the company.
Key Benefits of Investing in Hiring Practices That Focus on Internal Mobility
Transitioning to an organization that hires internally may seem like an overwhelming task, but the benefits far outweigh the risks, making it worth your time, energy, and money investments.
For one, hiring internally is almost always more cost effective than hiring externally.
As Reeshad Dalal, professor of industrial and organizational psychology at George Mason University, explains, hiring internally saves money in two key ways. “Internal hires are less likely to quit than external hires,” he says, which means companies save money by not having to go through the recruiting process. Also, he notes, internal hires typically have a smaller salary so companies spend less there as well.
While the financial benefit is a crucial motivating factor for most organizations, especially during lean times, there are other benefits to hiring internally. Current employees are likely already a good cultural fit with the company and aligned with company values. They are also familiar with the organization’s policies, procedures, and workflows which will help them move more seamlessly into the new position.
If finances are strained but you need to fill open positions to maximize productivity and meet goals, consider hiring from your current pool of employees. While it would require some cultural and procedural changes, transitioning to a company that prioritizes internal recruitment may help you better weather the current economic climate.
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