For most managers—particularly those in larger enterprises—it's far easier to fill openings by hiring from within than by interviewing the population at large, one by one. Even if you're not promoting or transferring one of your direct reports, you can get a much better feel for a candidate's track record and talents when she's not a complete stranger to your enterprise.
Having said that, there are basically two situations when an internal hire might not be the most effective option. One is generally positive: You need, or want, skills, ideas or perspectives that your organization simply doesn't have. The right external hire can do a lot to perk up tired, stale teams. But even in this case, it's sometimes more sensible to pick a known good worker from inside the enterprise and invest in training.
The other situation is generally negative: Both formally and informally, your enterprise gets in the way of matching up its talent...(register to read more)