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Research: why rejected internal candidates end up quitting

July 25, 2021
Borderless Leadership

There is perhaps no better experience for a hiring manager than seeing the resume of an outstanding internal candidate land on their desk. You can fill the job immediately and, because current employees know the organization and its quirks, they require less handholding in order to get up to speed quickly. You also rarely have to pay the premium typically required to lure in external candidates. As an added bonus, hiring an internal candidate signals to other employees that they too have a future in the organization, making it more likely that they will look internally when contemplating their next career move.

Given these benefits, firms have been expanding their efforts to make it easier for current employees to learn about and apply for new internal opportunities. Creating more open internal talent markets certainly increases the odds that a hiring manager will find that perfect internal candidate, but it also means that hiring managers more often find themselves in the unenviable position of having to tell other employees that they did not get the job. While good data on internal application patterns is hard to come by, recent estimates suggest that managers can expect to receive an average of 10 internal applications for every open job, a number that was confirmed in our conversations with talent acquisition leaders across more than two dozen large organizations. That means it is often the case that 9 employees — 10 if you hire an external candidate — hear “no” each time a job is posted.

How do those rejected employees respond? They respond poorly, at least in the short term. After all, no one wants to be turned down for a job, and the sting is often greater when you are told “no” by your current employer. Studies have shown that internal rejection leads to reduced job satisfaction and reduced commitment to the organization. Rejection can also engender feelings of envy toward the workers who “beat them out” for the job or lead employees to engage in counterproductive work behaviors, such as stealing from their companies. If employees stick around a few months after rejection, however, these negative attitudinal effects tend to fade away.

But many employees decide not to stick around. In fact, research indicates that rejected internal candidates are nearly two times as likely to leave their organizations compared to those who were either hired for an internal job or had not applied for a new job at all. The lost productivity, combined with the costs of finding replacements for these employees, is often substantial. We wanted to figure out how firms might systematically reduce the likelihood that rejected candidates will exit. Fortunately for firms, our research suggests that while rejection may be inevitable, turnover is not. READ MORE

by JR Keller and Kathryn Dlugos

Source: hbr.org

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