How many times have you heard that your existing employees are your best source of hire for new employees? Back in my days as a corporate recruiter, I was told this all the time. I had grand goals in place for my teams to hire a minimum 30% from internal referrals. We crafted elaborate programs around employee referrals and offered big cash payouts (and free lunches) for when referrals got hired. We wrote great communication pieces and hung signs around physical office spaces advertising our programs, and… wait for it…
Wait for it…
OK… Maybe not crickets. We got a few hits, and a few great hires, but after the first few weeks, our employees forgot all about us back in the recruiting office.
And we had to figure out why it wasn’t working…
Bill Boorman, a well-known-in-our-space advisor to talent technology companies and founder of the global #tru recruiting unconferences, writes and speaks often about employee and social referrals. One of my favorite of Bill’s comments is that by the very point of calling it an employee referral “PROGRAM”, it is destined to fail. Programs, by definition, have a start and an end. They’re linear. They have rules. They’re a planned series of events. On the contrary, employee referrals should be spontaneous and unrestricted. And, most importantly to the future of recruiting for your organization, they should be ongoing.
So, how do you create a stream of ongoing employee referrals? Here’s a five-point strategy that has worked well with many of our clients.
- Hire the right employees who really fit your business. This may seem obvious, but it’s a really important place to start. If you want your existing employees to refer their networks to you, it’s best to be sure that they are the people you want working for you.
- Be a great place for them to work. Another obvious one, but again, a very important part of the strategy. Would you refer a friend to work for someplace you couldn’t stand working?
- Lose the fine print. Make it easy for employees to refer candidates. The easier it is, the more referrals you will get, especially if you make it clear that a referral does not equal a recommendation. It’s not your IT guy’s job to select talent. That’s the recruiter or hiring manager’s job. Don’t tie rewards to hires; tie them to referrals. And, the rewards don’t need to be huge cash payouts, in fact, lose those, too. Reward for referrals alone.
- Ensure a great candidate experience. If candidates referred by employees have a horrible application / interview experience, believe me, it will set your employee referrals back significantly. Bad news travels fast. Treat all referrals like the VIPs they are. Keep your employees and their referrals informed at every step of the process, and provide timely feedback around the selection decision.
- Be persistent and consistent. Creating a true culture of recruiting takes time. Rome wasn’t built in a day. A contest is great, but don’t stop there. Build on the momentum. Promote your company’s culture across social networks, and let your employees do the same. Remind your employees often that you’re hiring, and give them the freedom to share that message to their networks in their own way. Highlight the employees who refer; help them feel special.
Bottom Line: Referrals generally have a lower cost per hire, a shorter time to fill, a stronger performance rating and a higher retention rate. Get started on transforming your company to a culture of recruiting today!
Success Story: With one client who needed to hire a fairly large number of people, we ran a referral contest. Every time an employee referred a unique candidate*, we entered his name into a raffle. 5 referrals meant 5 entries. At the end of the contest period, (in this case it was 3 months) we randomly chose a winner. The prize was a 2-night, three-day trip for two to Boston. (The company was located in the New York Metro area, and Boston, only 3 hours away, was a grand location!) The company paid travel, hotel, and entertainment expenses (tickets to a Duck Tour, dinner in a restaurant at Faneuil Hall, and some actual cash to spend on things of their choice!) Another hat-tip (pun intended if you know him) to Bill Boorman for the trip idea. It worked wonders. Not only did the contest get us over 150 employee referrals in 3 months with a 75% employee participation rate, the employee who won posted pics all over social media, and talked about her trip for months after she got back. Talk about generating excitement around employee referrals! This client plans to now choose a winner for this contest semi-annually!
*And, no, the irony of the “*” in the “lose the fine print” section is not lost on me. Referrals were tracked in the ATS, entered by the employee himself, so he was able to see immediately if the company already had that referral’s info in the system (unless a different email address was used.)