- The new person won’t be imbued with the same feelings of loyalty to the company that a veteran employee might harbor and, therefore, may be more likely to jump ship when another opportunity comes along.
- Long-time employees can be demoralized, their loyalty to the company eroded. That can make the new executive’s job that much more difficult.
- It costs big money to recruit an executive. DDI has found that the first-year cost of replacing an executive can run into hundreds of thousands of dollars.
- Odds that a recruit from outside the organization will succeed are about even. Byham says studies indicate that outsiders fail about half the time.