Generally, you try to hire candidate into a role that excel at (>50%) it but you promote employees into roles when they are achieving the next level but not excelling (<50%). If you wait to promote until they are excelling then you've waited too long.

Thus, if you interview those promoted employees, they are not going to match external candidates unless they have been in the role for a while and are now excelling.

Additionally, you evaluate external candidates much more heavily on raw skills b/c they have no internal knowledge/experience, but you include that internal knowledge/experience when evaluating employees.

Finally, interviewing skills != working skills. I've been writing software for 20yrs, and interviewing SDEs for almost as long, and I'd still do interview practice to prepare. In a normal job I can go search the details of what a red-black tree is, and find a library to use it (or spend a few days implementing it). In an interview I need to already know it and be able to implement it myself in less than an hour. (yes, that sucks, but it's the reality of interviewing today)