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Creating An Employee Referral Program? Here Are Some Great Examples To Get You Started

Posted by Kandace Miller

Employee referral programs (ERPs) are the crown jewel of many talent acquisition departments’ recruiting strategy. Selective hiring drives profitability and workplace efficiency, but referral programs happen to come with culture benefits.

The opportunity to reward employees with fun incentives, engage offices with referral parties, reduce turnover by and recognize successful referrers is like feeding four birds with one scone. Plus, referred hires feel they belong at higher rates than non-referred hires; culture fit is a must have for 76% of hiring managers.

If you are just starting or reviving a referral program, it is important to bring transparency to the referral process. Several major companies including Google have found an incentive, even a cash incentive, is less powerful than ensuring employees have visibility and recognition for every referral. Once you know how you’ll keep employees in the loop, take the necessary time to craft the ground rules on who can refer and how they submit. Remove as much friction as possible from the submission, tracking, and rewarding processes. Consider how you can keep referral program promotions fresh from quarter to quarter. And lastly, plan to provide feedback to referrers so they can improve their inputs, which will improve your hiring.

Incentives are key in employee referral programs. Studies have shown that experiences are most valued by employees. Task management software company Teamweek has implemented experiences that indirectly impact their referrers.

1. Teamweek

Teamweek is not shelling out for European tours, but they are motivating internal referrers and external candidates by planting trees as applicants advance through the hiring pipeline. An example of an altruistic incentive, tree planting is an activity that everyone can get behind and demonstrates something about the company culture.

Much of the battle of maintaining a steady flow of promotions will be staying top of mind with your employees as new openings hit the job board. A common ERP marketing tactic is switching up incentives regularly e.g., offering emotional rewards like Teamweek and localizing prizes for specific offices. Beyond incentives and catchy taglines (though here is a great list you can adapt), finding a way to make your referral campaign feel ubiquitous is a winning play.

2. Segment

Segment helps companies standardize and connect customer data. The recruiting team started with gamifying referrals and implementing a popular “Job of the Week” spotlight at company meetings before hitting on what amounts to a referral billboard: the Segment Referral Tree. By creating a daily visual reminder alongside the competition of a leaderboard, they are motivating their employees to refer two ways.

Now that we’ve established that referral programs are sparkly and great, we should take a look at their significant downside: lack of diversity. All else constant, white men benefit more from referral-based hiring than other demographic groups. Intel tackled this issue by doubling the referral bonus for women and underrepresented minorities. Pinterest took a direct appeal route.

3. Pinterest

If you want to maintain employee referrals and increase workforce diversity, Pinterest has a solution: just ask. The visual discovery tech giant started by being upfront with their employees and sharing aggressive, clear goals around diversity. They saw a 24% increase in female engineering referrals and a 55-time increase in the percentage of referred candidates from underrepresented ethnic backgrounds.

Employee Referral Program structure, incentive, and success rates are as varied as the companies that deploy them. I would suggest focusing on uncovering any specific current and future hiring needs you might have that could be fulfilled via an Employee Referral Program and then map out achievable goals accordingly. And you can always think outside of the box. It could be as easy as asking your team to reach out to past colleagues e.g., any notable women they worked with at their last company, or veterans for instance. Resourceful talent acquisition teams will succeed by building and maintaining transparent, modern referral programs that align with their culture and hiring needs.

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