As a talent acquisition leader or practitioner, it’s your job to help meet the needs of your growing organization by insuring a healthy pipeline of candidates that possess the skill sets (and personality) needed to run your company. With unemployment rates low and good talent hard to find, your work becomes increasingly more challenging as you seek innovative ways to attract the kind of candidates that will meet your hiring manager’s needs and lead to hires.
Here are 5 ways you know you are ready to invest in a formal Employee Referral Program:
1. You are a technology company, or a company with a heavy investment in technology.
Any recruiter knows how hard it is to find qualified software engineers these days. For every skilled engineer there are likely 10 or more jobs available at any given time for them to pick from – clearly a supply/demand problem. What edge do you have (outside of your awesome company culture and ping pong table?)
Relationships matter, so you’ll need to strategically tap into those personal and professional networks your employees have cultivated and if the incentives are right, and they enjoy working for your company, they’ll do it.
2. The job board well has run dry.
You post your jobs without much thought on LinkedIn, Monster, Indeed, maybe even CraigsList, and any number of niche job boards, but all you do is clog your ATS with under qualified and seemingly random resumes that don’t deliver much, if any, value.
Check your conversion rates. How many of your hires have come from candidates who applied via the job boards? If it’s less then 25%, that may be a sign it’s time to shift focus away from job advertising in the traditional sense, and focus on the social distribution of jobs your employees can deliver.
3. You hired 10% or more of your staff this past year through agencies.
20-30% placement fees are not cheap – and they add up fast. Rather then pay a third-party to make a glorified referral, why not leverage your employees who have access to the same talent your agency recruiter does? It costs a lot less and wouldn’t you rather pass a small fraction of that money along to a deserving employee?
Certainly your CFO would.
4. You are getting referrals today.
If you are already getting referrals from employees, you’re in a perfect position to capitalize on that to increase the volume of referrals you can get in the future. You’ll also need a better way to track and manage those referrals then what your ATS can likely offer you natively.
5. You have significant growth plans
For about the cost of one direct hire placement, you can be fully up and running with a branded Employee Referral portal, fully integrated with your ATS, be it Taleo, iCIMS, SuccessFactors, Workday, or any of the smaller or mid-size players in the market.
Now you know if you are ready to up your game in the referrals department. The only question now is, what is stopping you from making the investment?