If you’re a recruiter and have been trying to scale your teams and attract the best talent, you are probably aware of how hard it is to find that perfect fit for your team. Every firm wants its employees to stick around and contribute to its vision. However, in a competitive job market, it’s hard enough to recruit suitable talent. But it’s even harder to keep employees on board.
Benefits of an Employee Referral Program
An employee referral program is a perk that many successful organizations are turning to. As the name might suggest, the employees are rewarded for referring their workplace to friends and family who might fill relevant roles.
Filling roles with deadlines looming is a recruitment nightmare. And employee referral programs are a time-tested method to involve employees in your growth process. This helps in finding the ideal talent for positions faster.
Here’s how implementing an employee referral program can help your business –
- Reduced Time to Hire: Recruitment drives are long processes that are time-consuming. The most challenging part of this is that there is a high demand for skilled employees but the supply is limited. When you have an employee referral program, employees are motivated to ask their friends to apply. This reduces the time to hire significantly as you’re more likely to find the perfect fit when candidates are motivated by their friends and family.
- Reduced Cost-to-Hire: Budget constraints are a real factor in recruitment. The top talent is usually expensive, but employers’ budgets might be limited to a certain limit per hire. Implementing recruitment strategies is another expense, but employee referral programs are the most cost-efficient ways that are proven to work wonders for businesses. Studies have shown that businesses that use employee referral programs can save up to INR 250,000 a year per hire.
- Higher Offer to Join Ratio: It’s no surprise that people tend to choose things that have been recommended to them by friends or family. Businesses with employee referral programs have seen drastically higher joining as well as retention rates. It has been reported that companies that use employee referral programs had an average retention rate of 46 percent as compared to the 33 percent among companies who did not use employee referral programs.
Building a Strong Employee Referral Program
Here are three simple steps you can use to design and craft an effective employee referral program for your business. It’s no rocket science, we promise.
Step 1 – Identify Your Requirements
There are a lot of questions you can ask yourself as a recruiter, but the most important one is – what is it that your company is looking for and what should a candidate bring to the table for him/her to add value to the company?
So, this will help you narrow down to what key skills would be most valuable to the company. Some of the other important questions to ask yourself are –
- What positions must be filled?
- What are the skills required for the positions?
- And what is the goal behind the recruitment?
Step 2 – Decide How You’ll Go about Referrals
Things to consider are your budget constraints, how you want to pay out rewards to the referring people as well as the quantum of the budget. You don’t want it to be too low to the point where employees don’t think it’s worth the effort. Also, it shouldn’t be too expensive to even sustain.
Step 3 – Spread the Word
Once you have the quantum of your rewards sorted, you can share the details with your employees and encourage participation!
That’s it! That’s all there is to build an employee referral program!
In conclusion, employee referral programs have been the go-to way to boost recruitment efforts, helping HR professionals meet their deadlines, build a more productive and efficient workforce and help foster an environment of trust between employees and their employers
Hope this post helps you leverage this powerful recruiting channel to get the right talent onboard, faster.
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