The need for recruitment

1. Replacing staff who leave: people retire, resign to join another business or are dismissed, and the work they were doing still has to be done.
2. Growth: a business opening another site or serving more customers needs more people, so a cafe adding a second branch has to hire a whole new team.
3. New skills: a change such as starting to sell online creates a gap current staff cannot fill, so the business recruits someone who can run the website.
4. Seasonal demand: some businesses need extra staff for a few weeks only, and take them on for that period rather than all year.

Internal recruitment

1. How it works: the post is advertised inside the business, on the intranet or a staff noticeboard, and filled by promoting an employee or moving one across from another department.
2. Cheaper and quicker: there are no adverts to pay for and no agency fees, and because the person is already on site there is no notice period to wait out.
3. Less risky: the business already knows how reliable the person is and how they treat customers, so it is less likely to appoint somebody unsuitable.
4. Motivating: seeing colleagues promoted shows staff there is a route upwards, which encourages them to work hard and stay, so fewer people leave.
5. No new ideas: an insider only knows how this business does things, so nothing is brought in from elsewhere and poor habits are carried into the new role.
6. It leaves another vacancy. Promoting somebody empties their old job, so the business still has a post to fill, and colleagues who applied and were turned down can be left resentful.

External recruitment

1. How it works: the vacancy is advertised outside the business, through job websites, the local press, a recruitment agency, a jobcentre, a shop window or word of mouth.
2. A wider pool of applicants: anyone qualified can apply, so the business has more people to choose from and a better chance of finding the strongest candidate.
3. New skills and ideas: somebody who has worked for a competitor brings methods this business has never tried, and can fill a skills gap nobody inside could fill.
4. More expensive: adverts and agency fees cost money, managers spend paid hours reading applications and interviewing, and the newcomer needs induction training before they are fully productive.
5. Slower: advertising, shortlisting, interviewing and then waiting out the successful candidate's notice period can take months, during which the work is not being done.
6. Riskier: the business only knows the person from an application, references and an interview, so it can appoint somebody who interviews well but works poorly, and existing staff may resent an outsider being brought in above them.

Choosing between internal and external

1. Internal recruitment fits a vacancy that has to be filled fast and cheaply when somebody inside can already do the job, and it rewards loyal staff.
2. External recruitment is the only real option when no employee has the skill, such as Dyson needing another design engineer, and when the business is growing and needs more staff in total rather than a reshuffle of the ones it has.
3. Many businesses advertise a post inside and outside at the same time, so an internal candidate can apply but is judged against outsiders.