Last week, we talked to Barbara Bruno. You might know her from LinkedIn's Learning course "Talent Sourcing", that has surpassed more than 50k views since its launch in 2006. She's considered a top expert in sourcing, but she's also the CEO of Good as Gold Training, Inc. (a leading distributor of web-based training programs for the Staffing & Recruiting Profession), keynote speaker, author, and (as you might guessed), an Employee Referral advocate.
We contacted her to learn the ABC of Employee Referral Programs, the key components of a successful scheme, it's pain-points, why some programs fail and why some are very successful. But what we already knew, and what she absolutely reinforced, is that when it comes to sourcing talent, employee referrals are the best.
70% of the people I placed in jobs are referred. Because individuals that are giving me referrals, they know exactly the kind of person I want to represent. It's just like dating. If I'm a single person and I go to a bar and I meet somebody that I don't know, I'm not going to go out with them.
But if I have a friend that says, "here's the guy that I went to college with, I've known him for years, he's an amazing guy, the two of you have to meet". It's the same type of concept. There's that inferred level of trust.
As a recruiter, I'm not reaching out to a stranger. I know a lot about this person. The person that referred them to me has told me a lot about them. I've looked at their LinkedIn profile. They've given me some insight information, plus they know the person's personality. And they know our company, so they would know what would fit.
When you get a referral from another person, there's that infer level of trust. The interview process is usually shorter. You don't have to worry about that cold call initially. It's kind of a warm call because the person's set you up, you know? So it's like friends meeting for the first time.
It's not that coldness, and there's that level of trust. So the deal comes through much quicker because both people have rapport and trust. Plus, the employees told them what a great place it is to work.
I think referred candidates are by far the best. Referred business is the best, because it's shorter, it's faster.
1) Put someone in charge
Somebody has to be put in charge of it so that they're going to monitor it.
3) There have to be rules
Like, "these are the kinds of people we want you to refer". There has to be a process. And if I have a referral, who do I give it to you? And where do I put it and how do I see what happened? That's why it's good to have it, your ATS in your CRM or the person who gave the referral can go in there and see if that person was contacted, and keep track of what's going on.
4) Give rewards
The employees have to see the what's in it for them. Like in the USA, they pay a $1000 for a referral that's hired.
5) Acknowledge their efforts
Employees have to be acknowledged publicly, they have to be thanked. So when other employees see that this person got to have lunch or got to leave Friday half a day then other people will start giving referrals. it's not just enough to give them money or a reward.
6) Ask the right question
When you ask people for a referral, they're always thinking: "well, who do I know that is looking?" It's not who you know is looking, is who do you know that is best at this job. You gotta teach people If you're looking for engineers, you go to your employees and say: "who was the best engineer at your last place of employment?" So if you ask for referrals and people say "I don't know anybody" then you've asked the wrong question.
7) Follow-up on the referral
You have to follow up and let them know you followed up on their lead. If they give you leads and you don't follow up, they won't give you any more leads.
The main pain points are: they don't take it enough time up front, so they don't set a foundation. They just say, "we're going to have a referral program". Nobody's put in charge.
There's no theme, there's no process. And so the whole thing becomes painful and nobody wants more on their plate. A referral program should enhance the recruiter's job. It should make a recruiters job easier to try to a pizza party or to try to plan, you know, something virtual that is much more work than if they would just take the time to establish a good program upfront.
Step by step. This is how you do it. This is how you give the referrals. These are the rewards involved. We're going to recognize you if they do all that upfront and it's not time consuming and recruiters will realize this enhances their job because ... according to LinkedIn Learning over 80% of people finding jobs right now are finding them because of referrals.
So your employees are either your little army of recruiters out there telling everybody why your company is a great place to work, or they're being recruited away by another company. So you want to view your employees as this army of recruiters that is out there. If your employees are happy and they love their job, why wouldn't they refer your company to other people?
You know, of course they would, but if they see what's in it for them. So I think the pain points is every single part of the process. Unless you set it up right upfront and you have to have somebody in charge of it.
Most employees hesitate to give referrals unless they're very happily employed. Most employee referrals don't work because you got so much job dissatisfaction out there.
A happy employee is going to give you referrals, an unhappy employee is not. I don't care what system you have out there. There's a lot of job dissatisfaction. And especially now there's so much uncertainty in the world of what's going on. You know, and so a lot of people are reevaluating what's going on.
So the vast majority of employees aren't going to give you referrals anyway, because they're not happy. And they're in an active job search or they're in a passive job search. So it's easier, you know, when you put a referral program out there, it's only going to appeal to those employees that are happy.
Because then they don't mind referring their contacts because their name's on this. So if they're happy, you know, they'll give you names. They'll give you referrals. If they're not, they're not going to want to do that because they're probably in a job search.
I had a CEO get up at the CEO conference and he said, "we've had an employee referral program, we paid $5,000 for referrals". And I said, "how many referrals do you get?" He goes, "we don't get referrals". And I said, "then it's not your referral program, it's something with your company culture. What's your turnover?" He goes, "we've got extreme turnover". I said, "you got to solve the company culture". Companies with high turnover they're always looking for the magic solution and they'll blame the referral program.
When the referral program has nothing to do with it. You know, if it's not a good company culture, a good place to work. I don't care where you are, what country, what city, what town. There are certain companies that are known as revolving doors. And it's a hostile work environment that they don't treat women right, or they don't hire minorities. Companies have reputations out there, and because people are so well networked, they know those reputations.
There is no referral program on the face of the earth that's going to improve referrals if there's a bad culture. There just isn't. They've got to fix what's going on inside before they're going to get referrals. If I'm not happy, I'm not telling anybody else about this company.
It can't be a recruiter that's put in charge of an employee referral process because recruiters are salespeople. They don't want to be in charge of an employee referral program.It's gotta be someone else in the HR department. It could even be like an employer relations person or somebody else.
You don't want to put a recruiter in charge of an employee referral program because that's detail, that's tracking. They're salespeople. Recruiters are selling opportunities.
They're selling candidates to hiring authorities. They should not be in charge of the employer program, someone else should, and then provide the recruiter with the leads that they know are good.
You can get 2 or 3 referrals out of each employee if you do it right. But they have to see what's in it for them.
They have to be acknowledged and you got to follow up and let them know you followed up on their lead. If they give you leads and you don't follow up, they won't give you any more leads. So those are the main things I would say that constitute a really good referral program.
If somebody is giving you a lot of referrals, interview that person. Ask them: what motivated you to do this? What did we do? What did we say?
But if you recognize somebody, if I have 500 employees and 3 employees gave me quite a few referrals and I see that they're going to lunch with the CEO, I see that they got money, I see that they got time off, I see that they got perks and they're really being recognized, like their names out on our website, the names on the company newsletter, then I'm going to want that too.
You have to reward them in a way that other people are going to want to get the same reward and same recognition.