there is a least possibility of errors in selection since every company maintains complete record of its employees and can judge them in a better manner.
It promotes loyalty among the employees as they feel secured on account of chances of advancement.
The chances of hasty decisions are completely eliminated as the existing employees are well tried and can be relied upon.
The existing employees are fully aware of the operating procedures and policies of the organisation. The existing employees require little training and it brings economy in training costs.