Every company struggles today with both the cost of employee recruitment and the challenge of finding the right talent for each job. One look at the numbers and CEOs will ask the same old questions of their chief HR officers: ‘Why is it so expensive?’ And ‘can we shrink the budget’?
But there is a way to acquire great employees and keep them that doesn’t cost anywhere near as much as your standard recruitment efforts: employee referrals.
Research shows that referral programs are many times more effective than relying on job boards to find and hire applicants. Employee referral programs have proved to lower overall recruiting costs and improve the recruiting function’s return on investment because referred individuals typically get up to speed faster, need less onboarding, are more satisfied in their roles and stay longer at the company. Referrals have also proved to be a cost-effective way to tap into a large, qualified labor pool of passive job seekers. But studies also show that while many employers know the value of employee referral programs, they don’t always run the programs well.
Here are 4 tips for having a successful.
1. Keep employees and candidates informed. Don’t let referrals fall into the black hole of your hiring process. The likelihood of an employee making another referral if an initial suggestion just disappears into the ether is very low, said Kara Yarnot, an executive consultant and strategy practice leader at HireClix, a recruitment advertising and consulting firm based in the Boston area. She recommended investing in an automated referral platform to ensure that every referral and referrer is contacted and given updates throughout the process. “Just setting their expectations up front can make a big difference,” she said.
2. Empower your employees with know-how. Another fundamental reason behind the lack of referral program use is that employees may not even know about it, how to use it or what positions are open. Critical, hard-to-fill positions are featured weekly on the social media feed at Geisinger, a healthcare system serving 3 million residents in northeastern and central Pennsylvania, said Julene Campion, SHRM-SCP, Geisinger’s vice president of HR for talent.
3. Simplify your referral process. Make sure your referral process is mobile-friendly. Requiring employees to upload a candidate’s resume when making a referral will discourage them from doing so, as will requiring endorsements.
4. Offer rewards people want. Yarnot explained that about 60 percent of organizations with referral programs pay out bonuses for making referrals, but employees often don’t feel appreciated for submitting referrals, whether they get a bonus or not. “You can have a successful referral program, even without paying bonuses, by increasing public recognition for those who refer new hires,” she said. “Recognition from the CEO or team leaders in public goes a long way.”
Copyright 2017 SHRM. This article is excerpted from https://www.shrm.org with permission from SHRM. All rights reserved. The original article was written by Roy Maurer. The full article can be found here.