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6 elements of a successful employee referral scheme

Posted: 24 July 2012

So, you’ve heard that an internal employee referral scheme would be a great way to realise cost savings by cutting back on pesky agency fees, but you’re unsure how to make it work. In simple terms you reward employees for recommending their friends, family and acquaintances for vacancies within the organisation. So far so good. But there are 6 elements that must be considered before the big launch of any successful referral programme.

Before we dive in, I should point out why creating a slick referral scheme is worthwhile. Ok, so there is the ever-present cost saving angle, of course. But, you may not have considered that the most valuable and long standing recruits are often those that come from personal recommendations. Isn’t this how the world works? It makes sense that if your staff are willing to recommend your organisation then they will also be positive brand ambassadors. You wouldn’t recommend a friend to company you no longer believed in would you?

Current employees can also give a warts-and-all view of the company, and by virtue ensure the new recruit is a close cultural fit, meaning they can plug-in and contribute from day one and hopefully end up staying longer.

Here are my 6 key elements for the creation of a successful referral scheme:

1. Drive the right behaviour

Employees must engage with the programme, so think carefully about how you will do this and what your incentive will be; some schemes offer vouchers, some offer duvet days, some offer team nights out, some offer cold hard cash. Whatever it may be, it must grab people’s attention and match your culture……oh yeah, and it should cost less than other recruitment channels per placement!

2. Keep It Simple

If people don’t understand something they will lose interest very quickly. A succinct and elegant scheme will always be more effective than one that is over complicated, even if the rewards are greater. Also, keep the administration of the scheme as simple as possible so it does not tie up the valuable and costly time of your recruitment team.

3. Visibility

Ideally, the culture of recommending friends will be woven into the fabric of the company. This takes time. To get off to a good start it’s vital the referral programme has full visibility and employees understand the rules of engagement and potential rewards. Communication from C-level, posting on the intranet, posters by the coffee machine, use whatever it takes to get the message out. Just do it. Then repeat.

4. Network, Network, Network

My Great Auntie Marie is on Twitter, most professionals are on LinkedIn and I’ve heard of “Gentleman of the road” who have Facebook accounts. Your employees will be hooked up too. Encourage them to post new roles through their social and professional network platforms and let this become a positive habit and an integral part of the company’s culture, especially for all new employees.

5. Spread the Word

If a referral is successful then make sure everyone knows about it. The employee that made the referral in the first place should be acknowledged across the company by a senior member of staff and made to feel special. Let everyone see what is possible and be inspired.

6. Be Realistic

Have you heard of a company that recruits anywhere near to 100% of staff through employee referrals? (If so, please let me know!) Even companies with the greatest brand in the world implement employee referral as a single element of an overall multi-channeled recruitment strategy. Your referral scheme will be no different. It will also take time to build momentum, so work on it, hone it, let it evolve. If an element is not working, change it.