The market is cautious right now. Budgets are tighter, boards are asking harder questions, and with the economic backdrop - tariffs, inflation, geopolitical uncertainty - most companies are thinking carefully before adding headcount. From what I'm seeing across my client base, a significant chunk of the market is in defensive mode right now.
So what are the smart ones doing? Some are looking inward. Some are being more strategic about when they go external. The best ones are doing both, deliberately.
I'll be upfront: sometimes promoting internally is the right call, and a good recruiter should be honest enough to say that.
If you've got someone who's genuinely ready, not just next in line, internal promotion is faster, cheaper, and lower risk. They already know the business, the systems, the stakeholders. In finance especially, where understanding reporting nuances and commercial rhythms takes real time, that head start matters.
Companies with clear career pathways also tend to hold onto their best people, which matters more than ever right now.
I've seen this play out dozens of times in finance teams. A business promotes their Senior Accountant to Financial Controller, they've been there eight years, they know the business inside out. Looks like textbook succession planning.
Six months in, the cracks show. Technically excellent, but they can't influence the commercial team. They've never led through a transformation. They've only ever seen one way of doing things.
The reality is, organisations that only develop from within eventually hit capability ceilings. Same thinking, same blind spots, same assumptions. Innovation stalls.
And by the time you realise it hasn't worked, you've lost six to twelve months, the team has felt the impact, and you've got a difficult conversation with someone who was set up to fail.
Business transformation is the obvious one. If you're integrating an acquisition, migrating ERP systems, or restructuring how finance operates, you need someone who's done it before. That experience almost never exists in-house; your team has been busy running the current business.
Succession gaps are another. When a CFO or FD departs, and no one internally is ready, the cost of waiting is enormous. Strategic decisions stall, the board loses confidence, and the finance function drifts. I've seen businesses lose twelve months of momentum by trying to stretch an internal candidate into a role they weren't equipped for.
And then there's the fresh perspective factor, which I think gets underestimated. A senior external hire who's worked across multiple industries brings something an internal candidate simply can't: they know what good looks like elsewhere. That's not a slight on your people. It's just the reality of working in one context your entire career.
The companies that get this right don't have a blanket policy. They assess each role individually. They ask: do we have someone genuinely ready, or are we hoping someone will grow into it? Is this a continuity hire or a change hire?
When the answer is go internal, invest in that person properly - a development plan, a mentor, the support to succeed. When the answer is go external, move with purpose and work with a partner who understands the difference between filling a role and solving a business problem.
At DMC, we help with both sides of that equation.