Build or buy? It’s one of the big philosophical decisions organizational leaders face whenever they realize that their strategy requires bringing in new leadership talent. Do we promote hunger and loyalty by promoting our own people into key leadership roles, or do we send the message that the best talent wins regardless of tenure?

It’s a tricky one. And of course it’s not an either-or decision. An organization can take it one opportunity at a time and say to its staff, “We make the best decision for the organization depending on the situation.”

But don’t kid yourself. People do look at trends and draw conclusions. And your brightest talent will make their career decisions accordingly.

David Maister recently argued that going outside to bring in lateral hires for senior roles in professional services firms can dilute a firm’s culture. I think he leans toward promoting from within in those situations.

Regardless of your organization’s philosophical stance, most end up doing a combination of both. The next question to answer is, How does the person’s prior employment affect where we invest time and energy during a new leader’s first 90 days?

In our experience, it’s simply a matter of emphasis. Leaders joining an organization from the outside need to spend a lot more time learning what makes that particular organization run. Even more, they have to spend a lot of energy cracking the code of the organization’s culture – the unwritten rules that govern behavior. Perhaps most difficult, they have to figure out how to work productively in that culture while still staying true to their own core beliefs.

Internal promotions have different challenges. They know the overall organization’s business and unwritten rules, but they have to see it now from a new perspective. They sometimes have to overcome perceptions about them based on their past roles and behavior – and that can be daunting. Because either way – internal or external – our research and experience says that the early days are all about building productive work relationships.

How about you? What are the challenges and benefits to starting as an outsider or an insider in a new leadership role?