When creating a more senior position or needing to fill a current one, leaders need to decide where to go for that talent. On one hand, promoting from within rewards loyal employees who may be interested in moving up and gaining new responsibilities. On the other hand, they may not have the capabilities or experience to fill that role. Hire them when they’re not ready, and they could fail, harming your business and causing management challenges. Don’t hire them, and you could experience other management issues: They may feel hurt that an external hire was brought in for a role they felt they deserved.
A lot of factors go into hiring decisions, especially when hiring from within is an option. We asked our Fast Company Impact Council members how they consider this issue. Here’s what 19 members shared about their thinking process and approach.
1. ASSESS EVERY ROLE INDIVIDUALLY
We consider the skills and experience required to successfully fulfill the responsibilities of senior leadership roles, and just as importantly, each candidate’s alignment with our values. Using this foundation, we assess every role individually. In some cases, the greatest impact comes from elevating an established leader who can drive continuous improvement. In others, greater value may be realized by introducing external perspectives that open the door to new opportunities. While each role is unique, this disciplined and consistent approach enables us to make thoughtful decisions that best serve our people and the organization. — Mark Smucker, The J.M. Smucker Company
2. DEFINE THE SKILLS AND POTENTIALLY UPSKILL
First, you have to define the skills. Look at durable skills like negotiation, communication, and probing for clarity. Also look for foundational skills to make sure they are able to do it themselves, which is still fundamentally important in order to be effective at managing others, whether that’s a team of humans or AI. If someone internally has these skills, promote. If they don’t, hire externally. But in many cases, you cannot just hire your way out of a skills gap because nobody has the skill yet. That’s where upskilling comes in. It has to be a partnership between talent acquisition and learning and development. — Tigran Sloyan, CodeSignal
3. BALANCE TRUST AND CAPABILITY
Trust is the cornerstone of my professional philosophy and guides my approach to internal promotion versus external hiring. I often favor promoting those who have demonstrated loyalty and commitment over time—better the known than the unknown. While skills can be developed, qualities like integrity and trust are harder to instill. That said, I recognize the need for external talent when specific expertise or fresh perspectives are required. Ultimately, I balance trust and capability, knowing that long-term alignment often matters as much as technical excellence. — Manuel Freire Garabal, Gioya Higher Education Institution
4. IT’S ABOUT THE PERSON, NOT THE ROLE
Ultimately, its about the person, not the role, as well as the business goal. New people bring in new energy and expertise. Promoting from within is of immense value when the person is ready for it. The key is to not fall back on what is easiest, but rather understanding the person, their ambition, talent, and how they fit into your business and culture. Never see it as merely filling a role. It’s so much more than that. — Matt Owens, Athletics
5. INTERNAL CANDIDATES FOR INSTITUTIONAL KNOWLEDGE
I tend to lean toward internal candidates. There’s real value in institutional knowledge and a proven commitment to the organization. I almost always choose a curious, capable, and hardworking employee who can do 75% of the job on day one over an outside candidate who claims they can do 100%. Potential, mindset, and cultural alignment go a long way. That said, it’s important to strike a balance. We aim for roughly half of our senior roles to be filled through internal promotions, complemented by external hires who bring fresh perspectives and ideas. — Tony Bedard, Frontier Co-op
6. EXTERNAL HIRES CARRY RISK
My strong preference is to promote from within. The institutional knowledge, cultural fit, and trust that come with tenure are genuinely hard to replace. Each member of our current leadership team has been with the company for over a decade, and that continuity shows in how we operate. An external hire carries real risk, not just in the learning curve, but in the potential disruption to a culture we’ve worked hard to build. That said, there are moments when a specific skill set or fresh perspective warrants looking outside. But the bar for that is high, and internal candidates get every opportunity first. — Brad Weber, InspiringApps
7. IF INTERNAL, VET DILIGENTLY AND TRAIN
Promoting internally has almost always been a better fit, as long as you have the correct candidate and are willing to train them. Hiring externally brings new personalities, politics, and drama into a company, sometimes as a needed change, but too often at the expense of the business. Promoting internally requires a hard vetting of candidates to ensure that the person actually has the ability to fill the new role, as well as the commitment to getting them the training and mentorship required to succeed in that role. Without both of those, the person will fail and you may lose an employee who was doing well in their previous role. — Eric Basu, Haiku, Inc
8. WHAT DOES THE ROLE REQUIRE AT THIS STAGE?
I start by asking what the role requires at this stage of the company. If we have someone internally who has earned trust, understands our clients, and is ready to grow and succeed at the next level, promoting from within is especially valuable. It reinforces culture and continuity. In some circumstances, senior roles can require experience or expertise we have not yet developed internally, so an external hire can bring needed perspective or scale. The key is to make decisions based on future impact, and not just past familiarity. — Paul Toomey, Geographic Solutions
9. ASSUME SENIOR CANDIDATES HAVE THE BASELINE TECHNICAL SKILLS
The choice depends on why you’re hiring, the goals for the role, and how quickly you need someone operating at full capacity. The biggest challenge for me is that I have visibility into the internal candidate—their personality, strengths, and gaps—whereas external candidates typically only show their best side. Either way, I assume senior candidates have the baseline technical skills. What I really interview for is innate curiosity, authenticity, and judgment. Weighing these factors, I’ll always choose the person who shows the best judgment and cultural fit, regardless of where they come from. — Tony Grimminck, Scribd, Inc.
10. THE BEST PERSON FOR THE ROLE
It should be both. You decide who’s the best person for the role, and some of those people will come from within while others will be external. If the business is doing great and you want to continue, someone with institutional knowledge may make sense. If the business is at a pivot moment and needs change, new thinking, or transformation, then I would probably look more toward somebody from the outside. — Justin Tobin, Gather
11. DOES THE BUSINESS NEED ACCELERATION OR OPTIMIZATION?
It depends on the stage of growth. In high-velocity moments, the priority is capability and speed, bringing in external expertise to complement and elevate the team. Proven experience can compress timelines and unlock new levels of performance. In steadier phases, promoting from within often makes more sense. It’s faster, more cost-effective, and builds continuity, culture, and long-term retention. The decision isn’t either/or, it’s about what the business needs most right now: acceleration or optimization, and aligning talent to that. — Emily Kortlang, Yerba Madre
12. LOOK FOR PEOPLE WHO THINK LIKE FOUNDERS AND OWN OUTCOMES
People evolve into new responsibilities because they’ve shown they can own more ambitious outcomes end-to-end. Promotions are not given so someone can start taking on a bigger role; they’re recognition that someone has already stepped up, solved a meaningful problem, and proven they can operate at that next level. That said, we’re also hiring a lot to keep up with our growth, especially in a new market or at a different level of scale. Since last year, our team grew by 100%. Whether someone grows from within or joins from the outside, we’re always looking for the same thing: people who think like founders and own outcomes end-to-end. — Minna Song, EliseAI
13. PROMOTING FROM WITHIN SENDS A SIGNAL ABOUT CULTURE
I have a bias toward creating opportunities for people already in the company. They know the business, they have earned trust, and promotion sends a powerful signal about the culture you are building. I go external when we need something we do not have enough of yet, whether that is a specific skill, a different operating model, or a catalyst for change. The key is not internal versus external; it is what the business needs next. — Todd James, Aurora Insights
14. GROWTH DOESN’T HAVE TO BE LINEAR
The depth of institutional knowledge inside a cooperative, or really any organization, is a genuine competitive advantage. For us, growth doesn’t have to be linear. Some of our strongest leaders have taken nontraditional paths across the co-op. But great organizations also need outside voices to challenge inherited assumptions and explore new growth avenues. Sometimes the route you take depends on specific timing needs or the current lifecycle of the business. Either way, I’ve learned to be clear about what the role requires, and what the business needs, to build the strongest team possible. — Brett Bruggeman, Land O’Lakes, Inc.
15. AI HELPS US PRESSURE-TEST LEADERSHIP FIT AND CAPABILITY GAPS
Great hiring starts with defining the problem, not reviewing resumes. Before choosing between internal promotion or external hire, clarity on outcomes is key. What does success look like in 12-24 months? What capabilities are needed? What leadership will move the organization forward? Internal candidates bring trust and institutional knowledge. External leaders introduce fresh thinking and challenge assumptions. Neither is inherently better. AI helps us pressure-test leadership fit and capability gaps, but judgment matters most. The best hiring decisions focus less on resumes and more on the problem that needs solving. — Meredith Rosenberg, NU Advisory Partners
16. DO WE NEED SOMEONE WHO ALREADY MADE THE MISTAKES?
You have to ask “can we afford to learn into this role, or do we need someone who has already made the mistakes?” That usually cuts through the noise. I have a strong bias toward internal promotion because culture compounds. People in the trenches with you carry institutional knowledge that no external hire can bring. I’ve also learned to separate the person from the scope. A great contributor isn’t automatically the right leader for a larger remit. Conflating those two things is a disservice to everyone. When I’ve been honest about that distinction early, conversations usually land somewhere good for both the person and the company. — Rachael Nemeth, Opus Training
17. ALWAYS PROMOTE FROM WITHIN
I intentionally keep my team lean, made up only of highly skilled people I trust, so I always promote from within. That’s part of why my team has been with me for so long. It’s us in the trenches doing the work together. Of course I’m going to promote them. Hiring someone new, onboarding, getting them up to speed—it’s a lot of work for something that, in my view, is less likely to work out. — Lindsey Witmer Collins, WLCM Studio
18. REWARD LOYALTY AND PRESERVE COMPANY CULTURE
I have a strong preference for developing and promoting from within; it rewards loyalty and preserves our company culture. I only look for external hires when we require a specific, specialized skill set or a level of experience that we cannot effectively train in-house. — Logan Mulvey, GoDigital Music
19. BALANCE INTERNAL UNDERSTANDING WITH OUTSIDE PERSPECTIVE
As organizations scale, there’s value in balancing leaders who deeply understand the business, customer relationships, and what makes the company differentiated with leaders who have been through similar growth and transformation journeys at industry-leading companies. That outside perspective can accelerate change and help avoid common scaling mistakes, but it only works when paired with people who understand the culture and strengths that already exist. The goal is to evolve in a way that strengthens what already makes the organization unique, not copy another company’s playbook. — Patrick Frend, Delve