Working at a company that rewards and promotes its employees is a great thing for Working Girls. It shows that your managers respect you and want you to succeed. Not to mention internal promotion keeps employees happy. When a job opens up and an internal candidate fits the bill, it makes the most sense to offer the position to the internal candidate.
On the flip side, interviewing at this type of company as an external candidate is not so great. That is of course, if you get in the door. Some companies don't even post job openings or reach out to external candidates. They go right to the internal candidate.
Others like to see what is out there. They bring you in, bring you back and maybe even bring you back again. Then they thank you for interviewing and tell you the position has been offered to an internal candidate.
This has happened to me once during my recent job search. It's happened to my boyfriend. It's happened to plenty of other Working Girls I know. And am I right that everyone's reaction is "C'mon, really?!"
Part of me understands why a hiring manager would like to see what is out there. Another part of me knows that much more often than not the company hires the internal person if it comes down to the internal candidate and external candidate. For the internal person it's great, but the flip side is so frustrating.