Issue link: https://www.e-digitaleditions.com/i/182340
Talent Management people who aren't actively looking, getting your company in front of different pairs of eyes. referral from a top employee yields candidates who have a 90 percent greater profit impact than the average referral. Higher quality employees. New hires from well-designed employee referral programs routinely produce the highest on-the-job performance of any recruiting source. Recent research indicates that referred employees are roughly 25 percent more profitable than their peers. Creating Your Program Cultural fit. Your employees know your corporate culture better than anyone so they will not recommend a weak fit. They're also likely to paint a realistic picture of the job for the candidate, which leads to more informed decisions. A recent Harris survey reveals that the two most trusted ways to learn about a company are through past and present employees. Reduced time to hire. Referred applicants are placed within 29 days. Applicants from job boards take 39 days, while applicants from career sites take 45. Decreased turnover. Eighty percent of employees hired from job boards will be leave a company in two years. But because employee-referred candidates join your company with more realistic expectations and a built-in sponsor, they leave at much lower rates equaling an average of 45 percent retention after two years. Also, because the referral adds a layer of pre-screening, these employees have a 350 percent reduced chance of being fired. But there are also some considerations to take into account: Diversity. If your organization is not especially diverse, make an effort to branch out—the Equal Employment Opportunity Commission will be very interested in the diversity of your applicant pool if you rely solely on referrals. Reward referrals, not leads. If you pay for resumes regardless of quality, employees are incentivized to submit piles of unworthy applicants. To reap the benefits of employee referrals, insist on a personal recommendation. If an employee is willing to put her reputation on the line, that's a candidate worth pursuing. Consider the source. In large companies, employee experiences can vary dramatically. If you're hiring for the sales team, an employee in IT may not know exactly what that job involves. For the best results, give priority to referrals coming from the same team as the available position. Also give priority to your top performers—a There are a few best practices to follow in order to secure a successful employee referral program. 1. Define your employee value proposition. An employee value proposition (EVP) is an extension of your corporate brand and a critical part of recruitment and retention. Your EVP is an expression of what you offer potential employees, and the more accurate it is, the easier it will be to recruit and retain top talent. 2. Set a measurable goal. Make sure the program works by setting benchmarks for the number of employeereferred hires you want to make and set a timeframe for completion. Be transparent—managers can't work toward a goal if they don't know what success looks like at the end. 3. Select a leader. Follow good project management best practices and designate someone to lead the charge. 4. Create incentives. Recognition alone is a powerful motivator, but you'll get the best response if you give your employees a little something extra for their efforts. The more you offer, the more likely they are to participate, but make sure you're only incentivizing quality leads or you'll end up with unqualified candidates. 5. Spread the word. Your employees won't start making referrals unless they know you're looking. Communicate the entire strategy—not just the rewards part—to all employees, get your executives on board, and let everyone know when there's an opening in their departments. 6. It's a marathon not a sprint. After the launch, make a point to check in, remind employees, and give updates on your progress toward goals. It's not a one-time push; it's a permanent campaign. No HR program should exist in a silo. To make the most of your employee referral program, integrate it with an employee rewards and recognition solution and other human capital management software. With an online employee recognition program, you can create campaigns SEPTEMBER 2013 | www.hrotoday.com [79]