We’ve talked about referrals being your best sales opportunities, but did you know they can also be your secret weapon in acquiring top talent?
When we talk with clients about their HR process, how they find top candidates, we typically hear about “competitive salaries” and “perks” that set their companies apart. Those things are good; don’t get me wrong. The issue is that nearly every one of your competitors is offering the exact same thing! This is true in nearly every industry. In fact, I’ve yet to read a career page that doesn’t boast about salaries and benefits. So unless you can really stand out from the competition like these guys, your promises of perks and pay aren’t going to entice A-players. Those things are being thrown at them all the time. They are looking for more.
Just like with potential clients, potential employees are looking for a personal recommendation from a trusted friend or colleague who will vouch for your business. They are looking for security, and a referral from a friend provides that. On the employer side, you’ll see more qualified prospects coming through the door when they are referred to you by current employees. That’s because existing employees will typically only recommend people who great. Their own reputation is at stake, and they won’t vouch for anyone who isn’t up to par. Ultimately, you’ll see more profit. A study analyzing 25,000 employees showed that referred employees create a 25% higher profit than those from other hiring sources.
So let’s turn your employees into recruiters. Here are 3 tips for establishing a formal employee referral program.
Treat employees as partners in this process.
Employees must feel empowered in order to make referrals. To that end, let them know that their opinion matters, especially when it comes to choosing who gets to work with them or not. Communicate your hiring expectations and timelines clearly, and update employees throughout the hiring process so that they don’t get discouraged if their referred candidate isn’t contacted right away. When the position has been filled, notify all existing employees. Do not allow them to continue to recruit for a position that has already been filled.
How you communicate with your employees is up to you, as you know how your office “talks” best. If you meet every Tuesday morning as a group, include an HR update in your discussion. If you send out a weekly update via email, HR news and opportunities would be a wonderful thing to include.
Recognize the referring employee.
Some companies present gifts to their employees -- personal items, restaurant gift cards, time off, etc. -- when one of their referrals is hired. That’s a powerful way to incentivize referrals, but it’s not a requirement. What is important is that you recognize your employees with a note (or call or talk in your office) of personal thanks anytime they refer people to do you. After all, they have gone out on a limb for you, and have been thinking about ways to improve your company. That’s worth some gratitude on your part.
Track and measure the results.
As with anything you do, your referral program needs to generate the right return. Only by tracking data can you improve and refine your program.
Pay attention at the percentages of referred candidates who get hired, the quality of these hires, and the level of employee participation in your referral program. Continually ask, “Is this working like I intended?” By consistently reviewing the data you’ll be able to build a quality referral program that makes sense for your company.
Referral programs are the best method for attracting the brightest talent. And once you've established a structure and process that works, you can just sit back and let your employee-recruiters do the rest. By no means will this be your only recruiting tool, but it will be your most beneficial.
Do you have an employee referral system in place? If so, what about it makes it successful? We’d love to see your ideas below!
