September 11, 2014

5 Best Practices for Employee Referral Programs

Two smiling young business people shaking hands Ever wondered how some organizations are able to achieve a 60-70 percent hire rate through employee referrals while your organization is still lagging at a measly 25 percent or even less hiring through referral programs? The reason may lie in the practices being adopted by these organizations that signify a quantum leap in the effectiveness of the referral program. For instance who would have thought that introducing game dynamics into the referral program can bring about such a significant positive impact on employee engagement? Today organizations have tried gamification with a lot of success, helping them reap rich rewards from a more engaged workforce.

Organizations with highly driven referral cultures have always looked at best practices revolving around the basic principles of the program itself like responsiveness of the referral program, referral rewards, communication, etc. Following best practices in referral programs can help you benefit from the positive experience of others who have experimented with new referral initiatives with a great deal of success. It also gives you the opportunity to learn from the mistakes of others so that you have a greater chance of success with yours.

1. Brand your Employee Referral Program:

In today’s world, the success of the program depends on the marketing effort behind it. A well marketed program with flaws has a greater chance of succeeding than a fantastic program being run without any marketing effort behind it. Brand the referral program with a catchy name and logo like Microsoft’s ‘SpreadtheLove’ website or Hewitt’s ‘Gift a Hewitt Life’. A catchy name and tagline gives the referral program a purpose beyond merely staffing the company and entrusts upon employees the cause of organization building, a much more compelling and motivating objective to work for. The name, logo and tag line should be arresting and catchy enough to catch the attention of employees and generate recall whenever displayed. Market the program through posters, events, and distribution of collaterals with the program name and logo prominently displayed. Referral merchandise prominently displayed in the office can be a big hook to draw employees to the referral program.

2. Create awareness about your referral program:

Closely tied to marketing of the referral program is communication. A referral program which fails to reach the employees will never be able to fully engage them and make them willing participants in the referral program. In today’s technology-driven world, there is no dearth of communication channels, be it emails, 24-hour help line, employee chat, blogs, online videos and tutorials newsletters and even town-halls—any and all of them can be used to constantly update employees regarding the referral program, share successes and take feedback for program improvement.

3. Integrate Social Media to the referral program:

No employee referral program today is complete without social media integration. Advanced employee referral tools like ZALP use social media to unleash the potential of your referral program. The online world today is as much a part of our everyday life as the physical world we inhabit and hence maintaining an active presence online has become a key social imperative for everyone. Social media presents organizations with the unparalleled opportunity to tap these employee connections for organizational hiring through referral programs. With an integrated social media platform, employees can share job postings with all their networks as well as upload profiles of their social connections for job openings at the click of a button. The vast reach of the social media means that employee job sharing can potentially reach hundreds of thousands of people in virtually minutes, something which would require the organization to invest millions of dollars to achieve in the physical world.

4. Have a reward management system:

Referral rewards continue to be the biggest driver of motivation for employees to participate in the referral program. However, referral rewards can only motivate if they are in line with employee expectations, else they might turn out to be counter-productive, harming the cause of referrals more than helping. Introduce a reward program that seeks to reward everyone in some or the other way for participating. The bumper reward remains for the employee with the successful referral, but it is also important to recognize the contribution of employees who have referred but whose candidates have not made it to hiring. Recognition can be by way of hand written appreciation notes, public acknowledgement of contribution in newsletters and town-halls, gift cards and even small tokens like reserved parking space for some days. This helps keep employees proud and happy to be participating in the program and keeps referrals coming in.

5. Keep your employees updated on the referral status:

Lastly, nothing beats a referral program that responds to employees within a quick time window. A program that responds fast to employees conveys the simple, yet strong message that it cares for employees and their time. Ensure that employees receive regular updates on candidates referred by them; employee queries are responded to within definite timelines and feedback on candidates, whether good or bad is shared within reasonable time frames.

These small measures can go a long way in building an organization with a world class employee referral program, one which will help the organization hire the best talent in town and achieving higher output, by incurring only a fraction of the cost.

Read more in Employee Referral

Priyanka Prabhu is currently the senior marketing manager at ZALP, the leading employee referral tool. Priyanka has had vast experience in the marketing and advertising of B2B products prior to being a part of ZALP. At ZALP, Priyanka spearheads all areas of marketing, including product marketing, demand generation, customer success, and communications.