Promoting from Within

In recent weeks I've had two good conversations with respected, experienced leaders who have strongly different views on a fairly basic Human Resources matter.How should an organization handle internal candidates when hiring leadership roles?It's almost universally agreed that a healthy organization needs to be developing depth of personal in leadership. Many nonprofits struggle greatly with succession planning; both because of founders who are reluctant to share power (or leave when they should) and because finances make it difficult to keep much strength on the proverbial bench.Without people ready to assume at least interim leadership any organization is dangerously vulnerable to sudden changes at the top, when someone leaves quickly regardless of the reason.At this point though I'm thinking of an anticipated process.One of my conversations was with an executive search consultant who has worked extensively in the nonprofit world in Canada. His position was that an organization should fully process internal candidates before looking outside in most cases. The potential for disappointment and frustration is very high if someone "in the family" is rejected in even the most fair of processes.In contrast, a ministry leader I met with would urge internal candidates to apply among the outside candidates to ensure not only that they are truly well suited, but that they never have to second guess themselves if they are successful.What have you seen done, and how did it work out?My two cents is that I would prefer to see internal candidates considered prior to external initially and then, if they are not clearly suited for the role, for a single internal candidate to be submitted alongside the final short list of external applicants. Inviting multiple internal people to openly compete for a role is always risky and requires the highest levels of trust and communication to be handled successfully. The potential for distraction and frustration, or for misinterpretation in the process is very high.