Talking specifically about senior roles, there is always this question around whether to appoint internal candidates or recruit from the open market. As with all pertinent conversations, there are good points for both options, and the organization needs to remain flexible in approach if it is to maintain a fresh outlook and stay competitive.
“Build or buy” here refers to what is also called the “groom or buy” talent strategy, which entails decisions around whether to develop existing employees, identify, nurture and unleash talent in the existing pool of staff in preparation for, or response to emerging skill gaps and business needs, or to acquire talent outside the organization. So for clarity, building talent is where, or grooming talent if that is the more familiar term, it is where the organization invests in the identification and development of employees to occupy specific roles within the organization, as contrasted with buying talent, which is where the organization sources the requisite competencies from the open market to meet stated business needs.
There is no one-size-fits-all approach to appointing senior roles. Sometimes it may even be that the strategy that worked for one position, or one department, does not work for the other. Some of the factors we consider would be as follows:
- Time- frame: “Grooming typically takes longer, while “buying” can provide immediate solutions.
- Skillset: If the required skills are unique or highly specialized, it tends to be more efficient to buy externally until the internal ‘talent pool in grooming’ matures.
- Notwithstanding the enhanced speed of appointment where talent is acquired from outside the organization, we must bear in mind that growing talent carries recruitment and other general onboarding costs, as well as a very real degree of flight risk as employees become increasingly impatient after several years of waiting in the wings for promotions that do not come because of delayed retirement and the unlimited number of contract renewals in the c-suite.
- Finally, considering organizational culture, a policy to strictly appoint from within can maintain cultural patterns that the business needs to dilute and do away with, which promotes the practice of recruiting from the open market so that new perspectives are ushered in.
All in all it is best to use both building and buying talent strategies if the organization is to remain relevant and competitive. Perhaps that is the easy part, and the challenges arise with integrating the skills of the newly appointed from outside talent with the built by the business talent inside. It is important to deliberately cultivate team cohesion because the risk of an ‘us’ and ‘them’ mentality is ever-present. A good executive coach helps to mitigate these risks and facilitate productive team behaviours.
