Even in a tough economy with thousands of people looking for work, finding skilled employees who will fit well into your company culture and can hit the ground running, continues to be the number #1 priority for many executives. Every company should be looking at a varied approach to their recruitment. A good recruitment strategy will have a place for executive retained recruiters, job boards, career sites and many other tools. One great hiring tool that cannot be overlooked is to tap into your own trusted employees networks and create an effective employee referral program.
Many companies have great employee referral programs, but many don’t… my question is why not??
Employee referral programs should be a prominent part of every company’s recruiting strategy. Why wouldn’t you leverage your trusted employee’s contacts to find your next great hire?
The national average for successful new hires from employee referral is around 30%. With a great employee referral program those numbers can be even higher. At one company I worked for, employee referrals made up almost 60% of the hires and they were typically the hires that stayed with the company the longest, with the most success. It’s great for overall employee morale, everyone gets excited when they are working with people they like (employees will always refer people they like and can trust to make them look good!) so it really is a win-win.
Studies have shown that, not only do employee referrals have a higher “hire rate” than candidates from other sources, they’re also hired faster. According to a recent study, employee referrals averaged 29 days to hire, compared to 39 days for job board applicants and 55 days for career site applicants.
These referrals come from a trusted source, your own employee. They typically understand the culture better than other candidates from day one, because they’ve had the inside scoop from a friend who works there. They also come into the organization with a very positive attitude because they were referred by someone who enjoys working there. Additionally, the transition is much smoother when you have a friend on inside to show you the ropes.
So, it really is no surprise that employers seem to prefer referrals over traditional applicants in terms of their fit with company culture and overall cost.
So why aren’t more companies having better success? Why aren’t more companies having that 60% success rate that I talked about?
Ziv Eliraz, founder and CEO of Israeli social recruiting start-up Zao.com has four tips that will help get you and your company on the right track.
Change the question. Most employers ask, “Whom do you know who would be a good fit?” The majority of employees won’t personally know someone with the right qualifications, so their participation in the effort stops right there. Change the question to, “Whom do you and your friends know?” This broadens the pool of potential candidates and allows all employees to participate.
Widen the circle–offer referral rewards to trusted non-employees too. Employees are an obvious source to recommend qualified candidates since they know your business and industry well. But don’t forget other great sources, such as former employees, suppliers, vendors, and partner organizations. A referral program that leverages these sources as well as employees can deliver more qualified candidates.
Gamify your referral program. Most referral programs only reward the few employees whose recommendations result in a hire. That leaves out everyone else who tried to help–and their efforts are important too. Introduce some friendly competition into the process by making a game of it. Use a leaderboard where employees and departments can see where they stand in terms of referral volume, and reward those who are active in the program with small prizes like movie tickets.
Make smart use of social media. Zao uses social media and helps businesses save time and money by giving them the quickest and most effective ways to generate and manage employee referrals.
Zao’s platform pulls together Facebook, LinkedIn and Twitter contacts for referrers, using an advanced algorithm to suggest potential candidates within the referrers’ social networks and enabling one-click recommendations. It also provides an easy way to track and pay out rewards. Zao also brings an element of fun and competition for employees into the process with its social gamification feature set.
Leverage innovative new technologies. We are connected to so many people these days, that it’s impossible to track down all the relevant candidates for a particular job without technology that can match the job requirements to our friends’ skills.
This is just one example of how technology can help you with your own employee referral program. There are so many ways to get creative and get your employees engaged in the referral process. Talk with your management team and your HR business partners and look at what can be done for your company.
Mary Olson-Menzel mary@mvpexec.com Managing Partner of MVP Executive Search & Development, 20+ years of experience working in corporate America and executive search consulting. She specializes in senior level recruitment across digital, print, broadcast and cable media.
Questions from our Readers
Answered by Mary Olson-Menzel
I’ve been out of work for almost a year, is it time to get creative with my resume and cover letter. Creative as in sending my documents in on unusual color paper, sending it wrapped in brown paper and string, that type of thing.
Creative is good, anything to make yourself stand out, yes, but only to a point. How many resumes are you actually sending via mail anyway? Stop, think digital. Send via email. If you don’t have a computer, go to a library.
If you want to get creative… put on your suit and stop by the place of business that you are targeting and drop off a resume in person. I have a friend who was looking for was job in nursing and did exactly that, the hiring manager was there at the time, met with her that day and hired her on the spot. It can happen!
Why do employers run blind ads and are they even worth pursuing, or worse, are they just a way from criminals to get personal information?
Usually a blind ad is run by a third party recruiter or when a confidential search is being done. I don’t know of any “criminals” out there spending the money to run ads, but I guess you never know – I would just be very careful what ads you are applying to, and don’t have too much of your personal information on there (social security etc)
Posted on: Cynopsis Media