Introducing the Employee Referral Program in one of my previous organizations saved my life! There have been many vacancies requiring niche skills with no applicants at all. It seemed that I used all possible ways of finding talent. Introducing a structured, simple ERP and involving existing employees in the process of recruiting and hiring turned out to be an excellent decision. Employee Referral Program has become one of my favorite and most productive methods for finding talent. I decided to share with you my thoughts on ERP after a year of using it:
1. It attracts passive talent
Most of the candidates referred through the program were not actively looking for a new job. Some of them did not even have social media profiles. Without the help of my colleagues recommending them, our paths may have never crossed. Referrals opened a new door to broadening my candidate pool.
2. Time savvy
There were times when instead of having to craft a job posting, receive resumes, and screen through them all, all I had to do was to interview a referred candidate. As simple as that. Also, it turned out that new hires coming from employee referrals onboarded and adapted faster than hires from other sources. Usually, they were proficient at the software that we were using, even if these were niche programs.
For all the reasons mentioned above, a referred candidate is cheaper to hire than a traditional candidate. You do not have to pay typical recruiting costs to source them – an advertisement on a job board, agency fees, etc. – and, because they are faster to hire, it also means spending less on your internal labor costs. What is more, referred candidates are three times more likely to be onboarded than non-referral candidates. In my case, the latter proved to be the most efficient way to save money on recruitment.
4. Better cultural fit
Your current team knows the type of employees your business needs to excel in. Also, better cultural fit leads to higher levels of retention and happier employees. You can find better candidates who will stay longer with the organization through employee referral programs, as opposed to employees recruited by other means. I also observed that high-performing employees are likely to recommend candidates with similar qualities.
5. It strengthens brand awareness
When your employee wants to recommend someone for an open position, they talk to those candidates first. They act as ambassadors of your company. Job seekers trust much more their friends’ words than CEOs or corporate values listed on your web-page. Introducing the Employee Referral Program is an excellent opportunity for building up your employer branding strategy and talent pool for future job openings.
Few tips on how to implement ERP:
- Make it simple and easy so your employees can take part in it without too much bureaucracy. Create a program that employees can quickly grasp during the onboarding process. Educate new hires on how it works, giving examples of successful employees, and refresh the information regularly.
- Communicate it frequently.
- Build a compelling career site.
- Prepare engaging job descriptions.
- Think of transparent rules: who can take part in it, on what basis, do former applicants qualify, what would be the compensation for a referral, etc.
- Reward – will it be a cash compensation, maybe additional days off, or perhaps a trip to a faraway place?
- Provide instant feedback to employees on the referred candidates. Also, create a fabulous candidate experience – I experienced it quite a few times that referrals were the source of other great candidates! Consider asking: Whom do you know? as soon as a new colleague is onboard. They might know the perfect person from the company they just left.
Overall, there are a lot of positive things to gain from implementing an effective Employee Referral Program. It saves you time, money, and energy throughout the hiring process. Developing a successful referral program is well worth the time spent.