External Candidates and Succession

When Is It Time to Consider an External Succession Candidate?

One of the key strengths of succession planning is that it helps to develop talent that already exists within your company. This means that when more senior positions become vacant, there is a qualified succession candidate ready and willing to step into the role. There are numerous benefits to being able to fill positions internally. Examples include:

  • lower cost
  • less time in lost productivity as the candidate acclimates to the new role
  • reduced turnover
  • better fit within the company’s culture

However, it is unrealistic to expect that an organization will be able to fill all its critical positions from within. Deciding when to hire external candidates for succession versus promoting from within sometimes gets framed as the build or buy dilemma. For any company to be successful in today’s competitive markets, it is important to leverage both. Therefore, deciding when to build and when to buy is an important choice that organizations should carefully consider.

When Is It Time To Hire Externally?

You Need to Grow

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If your company is relatively small or undergoing a period of rapid growth, hiring external candidates often becomes a necessity. If your workforce is simply not large enough to keep up with customer client demands, then bringing in new team members will be essential to successfully grow your business.

You Lack Expertise

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One of the benefits of bringing new talent into organization is the knowledge and experience that comes with them. If you’ve identified an area of technical expertise that is lacking in your organization, and it is not something that can be readily developed from within your existing talent pool, then hiring for this particular set of skills may be a viable alternative. Knowing exactly what you’re looking for can help to make these external hires as efficient as possible.

You Want New Ideas

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When hiring internally without a succession plan in place, there can be a tendency to promote someone who is similar to the current incumbent. One of the benefits of an external candidate is the new perspective they bring to the team. When an organization is looking to foster innovation they may wish to consider the benefits of adding an external hire to the team.

Finding the right balance between hiring internal versus external candidates can take time. Some sources advocate for an internal hiring rate around 30%, but some large organizations report rates closer to 40-60%[1]. Finding the the internal to external candidate ratio that is right for your organization will depend on your company’s unique needs. If you have a formal succession plan in place, you should have a fairly good sense of those positions you can comfortably fill internally.

What to Consider Before Hiring Externally

As a general rule, before considering an external candidate, we recommend taking stock of your current talent pool. If you had to get by without hiring externally, could you? What would that look like? Is there anything you could do with your available time to develop someone on your bench to be ready for the role? In short, if you’ve thoroughly considered your internal options and none provides a sufficient solution, then it may be time to consider an external succession candidate. If you do, be sure to consider how you can integrate your hiring practices with your succession plan to get the most out of this process.

How SIGMA Can Help

At SIGMA, we want to help your company develop your potential. Our experienced consultants can help you manage performance in your company with our custom Succession Plans. Visit our Launch Series page to discover how we can deliver your personalized Succession Plan in just 30 days. We also offer long-term consulting services to help you navigate difficult succession planning situations. Contact us for more information on our succession planning succession planning offerings .

[1] Krell, E. (2015, Jan 7). Weighing internal vs. external hires. Retrieved from

About the Author

Sharon Van Duynhoven

Office Manager

Sharon brings our tests and assessments from the development stage to marketable product. She ensures quality control at every step of a project, edits technical documents and manuals, and artistically enhances reports and resources. She also manages contracts with clients across the globe and answers technical questions.