Motivating Employee Participation in Referral Programs

You know how essential your employee referral program is to sourcing candidates – but do your employees?

Referral programs are an integral internal sourcing tool for any company: the existing relationship between employees and potential candidates adds to candidates' positive perspective of the work environment, which attracts more qualified applicants. This ultimately results in a higher application rate and better retention.

And the glue that holds it all together are your employees – they are the referral program.But referral programs don't function in a vacuum. It's not enough to simply tack on a $1000 bonus to the paycheck of each employee who makes a successful referral, and expect them to continue to produce worthy results at the drop of a hat. In looking towards the end-goal of sourcing qualified candidates, it is important not to overlook one of the most basic components: ensuring that your workers understand just how significant the referral program is – and that their commitment is key.

There are several reasons why employees may not participate. They could be too busy with "real" work to consider who they know who could be a good referral. Even if they take the time, they have no guarantee that their efforts will be rewarded. And aside from the slight chance to win a bonus, the program is not very challenging or exciting. Furthermore, once they do refer a candidate, they are often left in the dark about their referral's development – they have no way of knowing how he or she was received, and are not given any positive reinforcement for the future.

In short, your referral program cannot reach its fullest potential unless you effectively motivate your employees. You can do this by recognizing their efforts (no matter the result), creating a more enjoyable process and keeping them updated. Give them a first-hand understanding of the usefulness of the program – and a more compelling reason to stay involved. Maintaining the momentum and keeping the energy flowing will enable you to further your recruitment success.

Five easy ways to encourage participation

We recommend five essential steps to ensure that your employees recognize the value of your referral program and are motivated to participate on a regular basis.

1.  Make it a Contest: To spark interest and excitement among your employees, turn the process into a game. Providing constant competitive incentives throughout, and not just a reward if their referrals is hired, injects a sense of challenge into the program, adding extra reasons to play the game.

In addition, stress the fact that referral programs are for the employees' own benefit - the better the referrals, the better the overall work environment.  As Dr. John Sullivan put it, explaining that they can be directly involved in maintaining (and improving!) the productivity level and collaborative capacity of their work team will leave each one racing to find the very best candidates ASAP. This also generates a sense of teamwork and unity.

2.  Reward of Value: Your employees are not a recruiting agency; even if their referrals do not result in hires, their efforts should always be recognized and rewarded. The bonus should be immediate and practical.  Insufficient compensation can result in diminished motivation.

When employees refer candidates, they act outside of their basic job descriptions. The reward should reflect this extra undertaking, and stand out. Consider presenting the bonus in the form of an actual gift. Your employees can use money for groceries or their electricity bills – it's not as memorable. Rewarding them with a special gift shows appreciation and recognition.

3.   Prioritize Positions: Direct your employees toward the critical job openings. You don't want them to waste time focusing on candidates for a part-time junior position that starts in a month when you have two V-level vacancies that need to be filled pronto. Prioritizing job opportunities gives employees a stronger sense of purpose and responsibility.

4.   Provide Tools: Employees should have all the tools and details they need. Help employees who give you poor referrals - pinpoint their mistakes, so that they better understand who to target and what type of approach to use in the future. Your regular and consistent encouragement demonstrates just how valuable your referral program is to your company.

5.   Transparency: Keep your employees informed of their referrals' developments. This enables them to provide further relevant input on candidates' backgrounds. Maintaining a transparent environment in which they continue to be a part of the process even after they make referrals sends the message that their recommendations were received, and that their hard work is benefiting the company.

In order to maintain and improve upon the success of your company's referral program, you need to keep your employees interested, motivated and satisfied. Taking the above steps can not only increase their continued active participation, but also foment company loyalty and higher retention. The more you prioritize your employees' role in your hiring process, the more they will prioritize your company.

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Tags: bonus, employee, engagement, participation, program, referral, transparency

Comment by Darryl Dioso on April 12, 2012 at 10:10am

I'm going to play Devils Advocate and add that part of the problem is that companies need to be "referable". Many employees don't want to refer friends and contacts because simply they believe "This place is awful to work at. Why would I refer my friend?"

Fix your house first before inviting guests to come over.

Comment by Assaf Eisenstein on April 15, 2012 at 3:20am

Hi David,

Thanks for your comment. You are absolutely correct - employees need to actually enjoy their place of employement before they would consider recommending their acquaintances for jobs. 

In addition, companies need to create their own effective employer branding message which spells out the kind of work environment they offer to their employees, and what they promise to potential candidates. Part of this is creating a positive corporate culture which reflects the company's dedication to its employees and their values. This positive work environment generates 'employment buzz.' (Check out our article on this here.)

Thanks again for your comment!

Best,

Assaf 

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