Referrals have proven to be an effective method of attracting people to your organization, whether customers or employees. In fact, over 45% of employees referred by colleagues staying for over four years compared to only 25% of those sourced through job boards.
On that note, we are going to discuss creative ways to get employee referrals, but first, let's understand their potency.
Firstly, referrals can help you discover the talent you could have overlooked for minor reasons. For example, the perfect candidate may be working in a different sub-field, on a personal project, or on a sabbatical.
Or perhaps they didn't update their LinkedIn page in the past five years while your employee knows they have moved on to a relevant field or learned the exact tech stack you use.
The referrer is likely to focus on the question, "Can they do the job well?" Subsequently, you won't miss out on a good candidate for irrelevant reasons.
Secondly, employee referrals can help you build a more diverse workforce. A company like Pinterest in Harvard Business Review article explains: “We understand that diverse teams yield smarter, more innovative results, which are essential in the competitive, dynamic tech industry.”
Many employees are likely to suggest someone similar to them (they look like them, come from the same region, or are of the same sex). How will that help diversity, you’ll ask? It will — if you request referrals from your diverse talent. Plus, when expanding your hiring team to the whole company, you’ll go past the subconscious bias of the recruitment team that is responsible for candidate sourcing or job board resume check.
Thirdly, referrals speed up the recruitment process. The referrer is made aware of the core attributes desired, and they quickly zero in on the ideal candidate, leaving the rest up to the employer. This reduces the need for a lengthy and bureaucratic application process.
While employee referrals can be quite effective, several factors make referral success elusive such as:
Candidate pool size – when looking for talent in niche and highly-technical fields, competition is higher, and increasing referral commissions barely boosts success. For example, Nikos Skemperis, who recruits cybersecurity talent at Fortinet, recounts;
"We launched an elevated referral bonus scheme of USD3000-4000. This had absolutely no effect on the referral rate. Nobody managed to make this extra money in the course of two years each." This was at a company that already had a referral bonus of USD2000, giving around 50% of the referral rate.
Referrer bias – sometimes, the referrer may sideline potentially good hires due to biases regarding the workforce's makeup. For example, they may feel that much younger people shouldn't get certain lucrative opportunities because they didn't get such jobs that early.
Experience – occasionally, the referrer may know suitable candidates but hasn't worked in the industry long enough to have good relationships with them. This becomes even trickier when the right candidates work for the competition, and there's room to argue tortious interference.
If such issues are not addressed, you end up with:
● A stagnant or diminishing ROI for your referral program, where you overpay for unimpressive candidates.
● A weakened employer brand since there's nothing memorable about how you court candidates.
● A disjointed workplace culture, with employees suggesting their preferred candidates rather than having a shared ideology on the kind of candidates to suggest.
There are numerous examples of employee referral programs out there. The problem is to make them attractive. Sometimes recruiters have to walk a long distance.
For instance, a technical recruiter Nikos Skemperis shared with us how he once placed business cards on HQ employees' screens while they were out for lunch. The sticker said “Make money while you eat”.
“Picked their interest when they came back and after 20 minutes I sent an email explaining the referral program. I don't have numbers for that but there was a healthy raise of awareness around the program. It was visible because only the HQ people's referrals increased.”
While different techniques for leveraging employee referrals will work for distinct organizations, many of these methods have some common underlying concepts. Accordingly, here are some core ideas of employee referral programs you can try out:
Employers can create competitions with their employees split into teams and given instructions on the ideal candidates to target. To make the referral program more effective, do some research about your employees and what they like.
For instance, audio engineers may want some of the latest studio or live production devices, while others might be into motorbikes, cars or all-expenses-paid trips. Once you find a prize that captures most employees' attention, have it on display in a common area of the work premises.
With the prize in place, set up a scoring system and have a board where points are tallied, and everyone can track each other's progress. Companies like InMobi, with a team of 900, increased their referral rate from 20% to 50% only through gamification.
Nikos whom we mentioned earlier also shared that he used to run so-called Referral Marathons with new employees at the orientation.
"I would divide new hires into teams according to region and language (but mixing different job functions to create some osmosis) and have them see some difficult roles and get to their contact lists and LinkedIn to attract them — like call them or send a message or give us their contact details and use employees as referrals. The team making the most points was winning gifts.
This was more like a game, and because it's social, it was good fun. We had very good traction with that and created a lot of "friends of the company", since we were not so pushy with the candidates. We had a lot of people that were not fit for a specific open role but a good nurturing pool and these were the best, long-term game for us.”
Nikos also clarifies that it’s important to expect non-compete rule when asking for referrals.
Social gatherings can help take some of the tension and formality out of the hiring process. They can also be a good time to gauge candidates' people skills, such as their ability to get along with teammates, morale-boosting communication and leadership skills, pitching, and more.
Physical events also help employers boost their brand appeal and make their workplaces more attractive. This is what makes social events ideal for enhancing a referral program.
The employees serving as referrers have a conducive environment to conduct job-related interactions and build relationships. The candidates invited can also drive a more genuine perception since they are in a less controlled scenario where every answer sounds like rehearsed pandering.
Social events can come in two forms. First, you can organize something casual such as beer parties, sports matches, and more. They can also be a hybrid, in that candidates have some drinks and tour company facilities to see how your employees work and the new amenities being installed.
Salesforce's Recruitment Happy Hour is an excellent example of the use of social events for referral purposes.
Employers can undertake initiatives such as lectures at universities, workshops, meetups, or conferences to discuss industry-specific subjects and pass on knowledge. Consequently, they can also identify candidates when participating in these educational activities.
By speaking out there, referrers position themselves as authoritative voices in their fields and also get to know who is looking to make a move into specific jobs. They become the brand ambassador of their company and show it is cool to work there.
As a recruiter or talent program manager, you can make sure your employees are participating in events that can also attract more candidates to the company. Plus, it’s a common practice for a speaker to share jobs in their company in the end of a presentation. Always ask your employees to include them, and motivate them by an award — same as for referrals that would come from any other employee at other circumstances.
It is prudent to check in with new hires periodically to learn about their journey in the industry and the relationships they've built. For example, you can ask questions like, "Who were your colleagues on your last major project before joining us?"
Or, "What's your dream project, and whom do you wish to work with on it?" By doing so, you'll know whom your workers admire in the industry and why they do.
As they work to provide this information, they build criteria and maintain lines of communication that will be valuable for referrals. This approach is common at companies like Google, where employees are also encouraged to keep tabs on prominent online profiles within their circles.
Many employees want to apply themselves in a manner that benefits their employers and communities. Employers can appeal to this desire as a way to improve employee referral success.
For instance, they can offer to contribute to an employee's favorite charity whenever they execute a good referral. Digital Ocean and Accenture have used this method before, coupled with monetary bonuses in some cases.
Different motivators drive people. It's better to know what motivates each team member with a strong network. Plus, you should make it cool for people in your company to do referrals.
While creativity goes a long way in producing successful employee referrals, it is not enough in the long run. You will likely have a scenario where momentum builds and fades once the occasional incentives are withdrawn. Therefore, it is vital to instill a referral culture within your organization.
An organization with a strong workplace culture is one where employees can speak positively about the workplace and encourage others to join, even when not under recent instructions to do so.
"It isn't the amount of money that is important, it's the referral culture. Do not drop the offerings of the referrers in a bad way, it can damage you in the long run. Create a "friends of the company" list that you can nurture" — that’s what Nikos Skemperis advises.
To cultivate a persistent referral culture, you can:
With a tool like Intrro, you can quickly engage your employees in connecting their networks to the platform and search for the best matches from a singular talent pool. You can then ask for introductions to the most appealing matches via Slack in one click. The process is not demanding much from both recruiters and employees — everything is automated.
To learn more about how Intrro works, request a demo.
Employee referrals can get you closer to the ultimate match for any positions you may want to fill. However, they require tremendous creativity and continuous effort to achieve maximum return on investment.
You'll need to understand your current workforce on an individual and group level to know what they value. Lastly, it would help to adopt technologies that converge your hiring-relevant information in one place and shorten recruitment processes.
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