Internal promotions play a significant part in creating a positive company culture.
The “New Year, New You” resolution doesn’t just apply to personal goals. It could also apply to your career advancement.
A big part of human resources departments and management’s role is to help employees succeed and grow. Their key role is to identify talented individuals and help them advance in the organization with better growth opportunities when they arise.
According to Forbes, (opens in a new window) employee loyalty will increase in 2024 due to factors such as strong company culture and career development opportunities. So, supporting your employees’ career progression is more essential than ever. It empowers your employees and increases employee retention within the workplace.
Research has also found (opens in a new window) that promoting workers into leadership roles can transform them into ‘more conscientious’ employees. Hired employees with the right skill set stay hired and perform well in their current roles. So, how does the human resources (HR) team choose to fill an internal vacancy? Should and do they look at who’s employed first?
Let’s get the ball rolling to help you understand how internal promotions can help improve career development within your organization.
Reasons to Promote Top Talent In Your Organization
Numerous companies have started promoting internal candidates with new opportunities. These new roles are created within the organization to provide room for growth. Encouraging employee development and promotions has several benefits for the company, such as:
1. Increases Employee Retention
An organization benefits from providing employees with promotion and development opportunities. These opportunities uplift candidates’ confidence and increase their loyalty to the company. Employees at organizations offering internal promotion opportunities stay 25% longer than companies that don’t (opens in a new window). Internal promotions can significantly boost employee morale and engagement by recognizing and rewarding employees, which fosters loyalty and motivates them to perform at their best.
Considering talented team members showcases good company values. It is an excellent way to appreciate existing employees and their competencies. These employees will likely stay in their current roles and work hard to get promoted rather than look for a new job.
2. Encourages Productivity
Filling a position with existing employees is a sign of deliberate decision-making in the workforce and encourages productivity. This shows that employers value and want to provide advancement opportunities for skilled and high-performing employees. Employees are more than their job titles.
Familiarity with the workplace's internal system also reduces the time required for onboarding. It allows employees to focus on continuous learning while handling the new role's responsibilities. This promotion strategy helps employees reach their career aspirations. It also saves the time and energy companies put into training programs for new recruits. They ramp up instantly!
3. Saves Recruitment Costs
Hiring new talents, no matter the job description, is challenging. HR professionals must expand the search to different talent pools, advertising fees, hiring agencies, and channels (hello, LinkedIn!), which costs the company human resources, time, and money. And don’t forget those potential signing bonuses!
Promoting existing employees to new and leadership roles supports their career development plans and saves on recruitment costs. Internal mobility of working talent allows the organization to flourish without losing valuable resources. There’s no need to screen hundreds of candidates while promoting your employees’ professional development. However, an external hire can bring fresh perspectives and new skills to the organization, though it may come with higher costs and longer onboarding times.
4. Minimize Hiring Risks
Internal employees are great hires. Their strengths, weaknesses, and cultural fit have already been observed and evaluated over time. This familiarity significantly reduces the risk of a poor hire. In fact, organizations favoring internal promotions are 32% more likely to be satisfied (opens in a new window) than those relying primarily on external recruitment. This increased success rate can lead to better team performance and reduced turnover in critical roles.
5. Enable Faster Hiring
Internal promotions can dramatically speed up the hiring process. They eliminate the need for extensive job postings, resume screenings, and multiple rounds of interviews with unfamiliar candidates. This efficiency is particularly valuable in fast-paced industries or when filling critical roles quickly is essential. On average, internal promotions reduce time-to-hire than external recruitment.
6. Improve Team Morale
When employees see their team members being promoted, it sends a powerful message that hard work and dedication are recognized and rewarded. This visibility of career progression within the organization can significantly boost overall team morale. It creates a positive, aspirational environment where employees are motivated to excel, knowing that their efforts can lead to tangible career advancements. Successful internal promotions not only improve employee loyalty and motivation but also enhance overall morale and engagement within the organization.
7. Strengthen Employer Brand
A strong track record of internal promotions enhances your organization's reputation as an employer of choice. It demonstrates a commitment to employee growth and development, making your company more attractive to both potential candidates and consumers. In 2025's socially conscious market, this positive employer brand can be a significant differentiator, potentially increasing your application rates by up to 50% for open positions (opens in a new window).
8. Develop Soft Skills in Internal Candidates
Promoting from within encourages the development of crucial soft skills. Employees with strong soft skills like problem-solving, communication, and leadership tend to get promoted 8% faster (opens in a new window) than their peers. By prioritizing internal promotions, companies create an environment that naturally fosters these skills, preparing employees for their next role and long-term career success. This adds meaning to their career paths.
9. Improve Employee Engagement
Clear career development paths and opportunities for advancement are key drivers of employee engagement. When employees see a future for themselves within the organization, they're more likely to be invested in their work and the company's success. According to Gallup research, this increased engagement can lead to a 21% increase in profitability (opens in a new window). In 2025, as the workforce continues to evolve, maintaining high engagement will be crucial for organizational success.
10. Create a Learning Culture
Implementing robust upskilling and reskilling programs (or development programs) to prepare employees for future opportunities demonstrates a significant organizational investment in your employees. Equipping your employees with new skills creates a culture of continuous learning, which is essential in 2025. Organizations with strong learning cultures are [52% more productive and 17% more profitable (opens in a new window)](https://www.onlinesafetytrainer.com/10-benefits-of-a-real-learning-culture/#:~:text=A%20study%20by%20Deloitte%20(conducted,percent%20more%20profitable%20than%20their) than their peers.
11. Improve Organizational Adaptability
By continuously developing internal talent, companies can more effectively fill roles with employees who deeply understand their unique business challenges and culture. This internal knowledge allows for greater adaptability in the face of market changes or industry disruptions. Internally promoted employees are 3.5 times more likely to successfully adapt to new roles than external hires (opens in a new window), making the organization more resilient and agile.
12. Recognizing Your Top Performers
Top performers who receive consistent recognition are 2.2 times more likely to go above and beyond (opens in a new window) their regular duties. By publicly acknowledging their achievements through internal promotions, organizations can create a powerful motivational environment that encourages high-performing employees to continue delivering exceptional results. Supporting your organization's employee growth.
13. Increased Job Satisfaction
Promoting employees from within an organization can improve job satisfaction by recognizing hard work and providing clear pathways for career advancement. This recognition motivates them to engage more deeply in their work, contributing to a fulfilling experience.
How to Make Decisions on the Internal Promotion Process
Organizations face this promotion dilemma every day. How do you decide who to promote internally? Establishing strong organizational policies that support an equitable promotion process is crucial for ensuring fairness and transparency in promotion decisions.
1. Look For Self-Starters
As a manager, start the internal promotion process by considering an internal candidate who usually has a fresh perspective on what can be done better. These employees take the initiative and want professional growth. They are natural leaders!
2. Check Performance Goals & Metrics
Pay close attention to the performance metrics that indicate potential for career advancement. Review year-on-year performance data, customer service scores, and other relevant metrics. Establish clear criteria for evaluating employees to ensure a fair assessment of their readiness for better career opportunities.
3. Pick High-Potential and Responsible Players
Look for employees who consistently excel in managing complex responsibilities and demonstrate a proactive approach to their roles. Focus on those who take initiative, successfully handle increased workloads, and exhibit leadership potential through effective problem-solving. As managers, establish clear selection criteria, such as reliability and problem-solving skills, to track and evaluate employee performance and potential for career advancement.
4. Consider Manager Feedback
Engage in comprehensive discussions with managers and supervisors about employee performance reviews. Identify team members who consistently demonstrate goal-oriented behavior and a strong work ethic, often indicating leadership potential. Look for individuals who focus on their personal growth and contribute to team success by offering practical solutions to ongoing challenges. HR should prioritize promoting employees who are receptive to feedback, address concerns constructively, and show a keen awareness of team dynamics.
5. Evaluate Interpersonal Skills
People skills, or soft skills, are just as important as being able to get the job done. Strong communication and connecting with team members are crucial for mentorship, managerial, and leadership roles. These interpersonal skills are essential for effectively delegating projects, collaborating with colleagues, and resolving conflicts. Evaluating an employee's ability to engage and inspire others can help identify those who are well-suited for advancement into leadership positions.
6. Conduct an Interview
When considering internal promotions, prioritize employees actively seeking learning opportunities to advance their professional goals, demonstrating their commitment to growth and adaptability. Conducting face-to-face interviews or hosting webinars can provide valuable insights into their aspirations, skills, and readiness for new challenges. This approach helps you assess their potential for success in a leadership role and reinforces the organization's dedication to fostering talent from within.
Build Your Employees’ Careers with Rise
While prioritizing internal promotions, it’s crucial to maintain a balance with occasional external hiring. This approach ensures a healthy influx of fresh perspectives and innovative ideas, preventing organizational stagnation. To maintain this balance, aim for a mix of about 70-80% internal promotions and 20-30% external hires. Additionally, having a structured internal promotion model can foster employee motivation and loyalty by clearly identifying growth opportunities and clarifying roles and responsibilities.
When considering internal promotions, it’s crucial to prioritize employees who demonstrate strong team player abilities alongside their technical skills. While problem-solving capabilities and interpersonal skills are important, how employees interact with and support their colleagues can be the ultimate deciding factor.
Rise’s HR software can significantly simplify and improve the internal promotion process. With features like comprehensive performance reviews and 360-degree feedback, Rise enables HR teams to gather data on employee performance and potential. By leveraging these powerful HR features, organizations can make data-driven decisions for internal promotions, ensuring they select candidates who will excel in new roles and positively impact team dynamics.
Learn how Rise can transform your internal promotion strategy and overall HR processes and discover the potential of data-driven talent management— see it all in action now (opens in a new window).
