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That really depends on your goals. Hiring experienced outsiders brings new ideas. If this is not targeted, it will be better to promote capable staff from within.
It will depend entirely on the profile of existing employees. If you have a good succession plan in place, there is no need to worry but if there is no such plan, you must pragmatically evaluate each potential internal candidate and decide for an outsider if none meet the profile of the required manager.
I believe, it is better to promote within the organization for many reasons such as: lower salary-motivated by the new position-loyalty, and aware of the organization environment. Unless we are haring for some departments that need more creativity and new ideas such as marketing so we need some one from deferent environment with new ideas.
I think there is a fine balance here, i would always look to promote from within for lower level management roles unless there is an employee who shows enormous talent and potential, other than that i think brining in experienced managment staff from outside would be the better option.
It depends on the circumstances, if the current employee has all the qualities and the ability required for the position then the company should promote him. If the company does not find the suitable employee required for the said position, then it should go for external hiring. There are also few pros and cons in promoting the current employee.
1. Cost factor
2. Motivation among other employees to work better
3. Boosts the morale of the current employee
4. Proper communication and co-ordination as he knows the system of the organisation
5. Helps in building client relationship
6. Already in line with organisational goals and its vision.
It is better to promote current employees for managerial positions but sometimes the existing employees don't have sufficient ability to run the matters at desired level. So it becomes imperative to hire more efficient people from outside.
If the company adopts policy to promote from within then they should provide them the opportunity to upgrade their skills through necessary courses.
