April 21, 2022
What is an employee referral program and why is it so important?
Talent recruitment is one of the main priorities for the Human Resources area. At times, finding good candidates can be a really difficult task and take more time than expected. Is in this context that referral programs enter the picture. When these are crated correctly, they can help you boost the results you receive from your recruitment strategy.
Do you know what is employee referral or why are they so beneficial for the recruitment process? At T2W we have an extensive experience in recruiting and talent acquisition. We can help you to have a better understanding of this concept and the reasons why it is so important for finding talent.
What are employee referral programs?
An employee referral program is an alternative method to find talent. It can speed up the recruitment process and, at the same time, improve the quality of hire. You probably have already used traditional channels to find talent such as social media, employment sites or ads. Referral recruitment doesn’t use any of those channels.
Instead, this program uses the knowledge employees have about the company and give them the task of finding a professional who fits the available position as well as the company culture. It is likely that they personally know someone with the skills you need, so they can help you. Of course, if the candidate you get is a good one, the employee has to receive a reward.
Benefits of an employee referral program
1. Speeds up the recruitment process
In a regular recruitment process, the stage that usually takes more time is evaluating the candidates. Here you have to check a myriad of resumes, screen the applicants and filter those who don’t really fit the position. All that process takes time, which is a very valuable resource in recruitment.
In general, recruitment processes could last for weeks and even months until you find the ideal candidate. That is specially the case when you have to find very specific profiles such as IT professionals. The last thing you want is having to interview a lot of candidates who don’t meet the requirements of the position.
Employee referral programs let you jump many steps in the recruitment process. Here, your employees are the ones who might find among their contacts the best person for the position. They probably know candidates whose skills they know, so they can fully recommend them. Therefore, the time spend in screening and evaluating applicants is a lot shorter.
2. Increases the retention date
One of the biggest threats in the Human Resources area is the employee turnover rate. In that sense, one of the main causes of employee turnover is not checking if the candidate would fit the company. It is important to find a good professional, but we can’t forget that it’s also necessary to find a person who will assimilate correctly the organizational culture.
This is another of the strengths of referral programs. Since you are counting on your employees to find talent, you take advantage of their knowledge regarding the particular culture the company has. Your employees are the ones who are in the best position to determine who would be the best choice.
As a result, the candidates they recommend are usually more in tune with the company, its values and the way of working. This way, new hires integrate easily with the organizational culture and they are more likely to keep working with you for a long time.
3. Reduces cost of hiring
A regular recruitment process uses several channels to announce the available position and reach as many people as possible. Announcing in those channels can be very costly, especially if you have to find someone with a very particular profile and the process extends a lot.
Likewise, many organizations choose to outsource the recruitment process, which can really give you good results. However, as effective as it is, this method has also a cost. In contrast, an employee referral program allows you to save all those costs.
In this case, the channel you are going to use to find good candidates will be your employees. While you will have to reward your employees for helping the company find talent, the payment is granted when the you receive a good candidate and the cost is not nearly as high as announcing in a traditional platform.
Now you know what is an employee referral program. Do you think this program can work in your organization? Then create one, implement it and give your recruitment process a boost.
At Talent2Win, we strive to align your company’s business objectives with the best Talent Acquisition strategies available. If you want to learn more about the services we offer, do not hesitate to contact us.