Despite the current trend of internal promotions and staff retention, hiring externally can be a major advantage for many businesses, especially when it comes to leadership positions according to C-suite recruiting expert Marks Sattin.
While promoting from within brings continuity and institutional knowledge, it may not always meet the evolving demands of the market. “In some cases, internal candidates simply don’t have the exposure or skillset needed for what the role requires today,” said John Quach, Director of Marks Sattin’s London Financial Services Team. “Internal promotions can offer cost savings in the short term, but they’re not always the best strategic fit.”
This can be particularly true in sectors and businesses undergoing rapid transformation in order to modernise. Outside hires can bring in leaders who can inject fresh energy and perspectives, bringing in new thinking, challenge legacy processes, and implement modern frameworks that drive innovation. Internal candidates may be well-versed in the company’s history but not necessarily equipped for its future.
“There’s real value in someone coming in who’s not entrenched in the way things have always been done,” added John. “They can identify inefficiencies and opportunities that others might overlook.”
That perspective comes at an initial cost. Salary expectations for external hires have increased, with senior-level candidates often negotiating 15% – 20% increases compared to their previous roles. This sits in stark contrast to the 5% – 7% typical for internal promotions. But the investment can pay dividends for a business that has stability and long-term vision as core pillars.
C-suite roles, such as CFOs and CEOs, exemplify this. These positions are not only critical to company direction but also extremely costly to get wrong. Hiring the right external leader, even at a premium, can save a business from poor strategic decisions, lost investor confidence, and team-wide disruption. “You don’t want churn in these roles,” said John. “Spending more upfront is far cheaper than the cost of making the wrong hire.”
Following the post-pandemic hiring surge of 2022 and 2023, the talent market has softened. Qualified professionals, many with high-level experience, are now available. The oversupply presents a window for companies to attract top-tier talent they might have struggled to secure in a more candidate short market.
Internal mobility remains an important tool for employee morale, cost savings and retention. But it’s not a one-size-fits-all approach. For businesses seeking to future-proof their leadership and inject agility into their strategy, external hiring is still essential.
Marks Sattin operates across nine branches in the UK, the Republic of Ireland and the Netherlands. Specialising in finance, technology, legal recruitment and executive search related roles. Marks Sattin prides itself on developing careers by connecting talented professionals with the right business.
For more information about Marks Sattin, visit: https://www.markssattin.co.uk/.
