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The employee referral program can reduce the cost of attracting and retaining top talent, and at the same time motivate your existing employees to recruit for you. In this guide, we delve into the impact of properly implementing the employee recommendation plan, as well as some quick tips and long-term strategies that can be used to fine-tune the recommendation.
Why is the employee referral program so important
By now, you may have realized how expensive it is to acquire new talent for any particular company. In fact, after you spend time and energy searching and reviewing candidates, the cost of hiring a new employee can be as high as $5,000. In short, an effective employee referral program saves you money by shortening the employee review and recruitment process.
greenhouse The results of the case study of the sharing referral program show that the employee retention rate is as high as 46%, while the employee retention rate from the recruitment website only hovers around 33%. Not only that, employees from referral programs generate approximately 25% more profits than employees from other sources. Historical evidence shows that implementing a referral plan is very worthwhile.
Employees recommended from existing employees also tend to stay longer in the company and are better candidates. So, if you know that you can save yourself a lot of money, increase retention, and get a higher-quality candidate-instead of struggling during the application process and finding an inappropriate substandard company candidate-what is Prevent you from implementing and improving the employee referral program?
You may already be asking yourself this question. To help, we have assembled a comprehensive guide that contains tips on how to improve the employee referral program in the short and long term and which tools can best help you get the job done.
Quick tips to immediately improve the employee referral program
When you build a repeatable and sustainable employee referral program, automation will become your best friend.Use staff-recommended friendly tools, such as feasible, You can start recruiting more high-quality talents immediately.
With it, employees can upload resumes or provide links to online profiles. Throughout the process, regardless of whether the recommendation attracts any attention, employees will automatically understand the status of their recommendation through the power of automation.
Automated process
The automated employee referral program ensures several key things, including:
- Make sure that recommendations are not missed and get lost in the shuffle
- Ensure that the right employees are rewarded for referrals
- Eliminate unnecessary paperwork that may be caused by manual processes
- Motivate employees to stay involved and informed
- Make it easy for employees to participate and find accurate information about the referral process
- Make it accessible to everyone in the company who needs to know about it
Without automation, it will be difficult for you to ensure employee participation, accurately record who recommends whom, and archive information to schedule interviews and review candidates. The best way is to use an applicant tracking system that includes a powerful recommendation tool.
In our case, this is why we recommend a multifunctional all-in-one recruitment solution like Workable. Once you have set up the employee recommendation workflow, just check which recommendations have entered and adjust your strategy at any time.
Choose your incentives
One of the fastest ways to start a referral program is to determine your employee incentives early. How will you attract them to participate and enter a reliable letter of recommendation for any open positions that appear? How do you know if your incentives are really what your employees want to win?
It is these questions that can lead you to choose better incentives, not just reward successful referees with money. Although money can be as good as any incentive factor, in many cases, if you not only provide monetary incentives, but also mix it with some non-financial allowances, it may be best.
These can be:
- PTO (everyone likes some free PTO)
- Extra holidays throughout the year
- Special thanks letter from superiors
- Exciting company swag
- Award or recognition ceremony
- gift card
- Useful and relevant memberships
The better your incentive mix, the higher your participation rate. Combine this with awareness-raising efforts, and you will soon see your referral program begin to take shape (and attract attention).
Raise awareness
Needless to say, unless you let your employees know about its existence, you won’t see any recommendations begin to come in. There are many ways to do this, including raising it in a meeting, setting a reminder in the lounge, or making an announcement in the company newsletter.
The more you publicize your referral plan, coupled with a carefully selected set of incentives, the more your referral plan can become the first consideration for employees. Once it becomes a top priority, if your recommendation submission process is easily accessible, employees will definitely be more motivated to submit the best candidates from within their network.
Make it easy to access
The last thing you want to do is make it difficult for employees to submit their recommendations. Is there a centralized place online where they can easily submit resumes or links to public information? Is there a way to let them know their referral status?
You can seamlessly set up and manage the process for you by using online tools like Workable to make your recommendations more accessible. However, you can do your own research to find the right tool for you.
Empower your employees through gamification
Empower your employees to take the helm and recommend as many valuable candidates as they can think of, starting with publicly rewarding successful recommenders. Sometimes, you must make your employees excited about what might happen. Empowering them and letting them know the right incentives and the right information can go a long way in getting the results you are looking for.
Make sure to let them know that your referral process is a win-win. When you get a recommendation from a valuable potential new employee, they will get rewards, allowances, and recognition. Gamification can be an important part of the success of your referral program. The higher the quality submitted by employees, can they reach the recommendation level to unlock new rewards?
Remember, you don’t have to wait until you have successfully hired employees to reward employees. Once the employee submits the recommendation, the reward can begin. This can show other employees that even if they have not become employees, you are serious about rewarding valuable referrals. The key is to make sure that you get your employees excited to participate and share the best form of their network.
Long-term strategy for better employee referral programs
If you want to maintain your recommendation plan for a long time, you need to develop a plan to maintain and improve the process as your needs change. These are a few key points that you should remember, and they will help you do this.
Schedule occasional reminders
Keeping the top consideration requires scheduling occasional reminders. Employees are busy with work and taking care of business. Politely remind your employees that the recommendation process is effective and that the company is looking for a specific employee, which will help employees remember where it is in case they want to recommend or meet someone on the road.
You can also send emails occasionally or raise them in meetings. The point is, if you let your referral program take a back seat and stagnate, it won’t do much for you by itself. Although there are many things that can be automated, you’d better handle other things proactively.
Revisit your incentives
Chances are, you won’t get the ideal referral plan the first time you try. Sometimes, implementing a recommended plan to obtain results requires some trial and error. Before formulating a recommendation plan that suits your company culture and motivates employees, you may have to experience a failure or readjust your various incentives.
Revisiting your incentives from time to time is a good way to ensure that your referral program is as fine-tuned as possible. If your company grows, it may be able to provide your employees with better and more relevant referral rewards.
Or better yet, if your referral budget increases, maybe you can afford a larger and better referral reward. The secret to keeping the referral program useful is to put it first and keep it relevant as the company grows, motivation changes, and different positions open up.
Participate in leadership
A successful referral program is not necessarily a process you complete alone. Putting superiors and employees in leadership positions can help bring excitement and participation in the recommendation process.
Can a manager provide additional rewards for team members who successfully recommend someone? Can the leadership occasionally but purposefully remind employees of the existence of the referral program?
The more your leadership is involved, the more likely your employees will take recommended candidates more seriously, and the more extensive your referral work will be.
Improve your corporate culture
Although you may not automatically think of this when you brainstorm to keep the referral program running for a long time, improving the company culture in the first place may be a big step towards ultimately managing a more successful referral process.
Improving and defining your company culture can help you find employees who are more suitable for your long-term culture, which can also help increase employee retention. Not only that, you also need to spend less time on recruiting new employees.
Overall, this illustrates the interrelatedness of the way you run your business and how much one thing can have an impact on another. If other key parts of the company are not actively taken care of and fine-tuned to achieve growth, referral programs alone will not save your business from hiring underperforming employees. Ask yourself, what is the current state of my company’s culture? How does this affect the results of our recommended work?
Collect feedback
Back to employee motivation, if you don’t ask them, how do you know what motivates employees? Taking the time to collect employee feedback can be a very valuable part of the entire process.
Although it is easy to assume that you already know the drivers of an incentive plan, gathering feedback can usually tell you otherwise. There is no doubt that frank feedback from employees on your referral program may be one of the best ways to improve and view actual results.
Consider establishing an employee feedback process. If you think this would be better, please remain anonymous. Once employees are able to share what they want through an online log system or other means and the methods that really drive them to share recommended opinions, you will have a wealth of data from which you can extract and revise courses.
Next step
As far as a successful business is concerned, a successful employee referral program is only part of the puzzle. There are many things to learn and navigate.This is why we love nerds and create guides for the best things Performance management software.
From there, you definitely want to check out our complete guide The best employee monitoring tool To ensure that you are optimizing your project and workflow.
Are you looking for an employee induction guide?Our guide The best starter software Can help you choose a tool to optimize your approach to new hires. If you like this guide, be sure to bookmark it for future reference.
This article was written by Daily Eggspert today.
