Guide to a successful Employee Referral Program


Published on

Employee referrals have proven to be one of the top ways for organizations to acquire top talent. Benefits of an Employee Referral Program (ERP)

Whether your organization is tuning up or just beginning to put an employee referral program in place, here are a few important keys to success to help launch and promote your employee referral program (ERP).

Published in: Business, Technology
  • Be the first to comment

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide

Guide to a successful Employee Referral Program

  1. 1. Guide to a successful Employee Referral Program
  2. 2. Questions to ask for Successful Referral program • Why should your company go for a referral program • Whom to invite for participation in the program • How to ensure continued engagement and interest in the referral program • What results to reward • How to build momentum and increase participation over time Nearly 3 in 10 employers have caught a fake reference on a job application Guide to a Successful Employee Referral Program
  3. 3. Why should you go for a Referral program • Employees hired through referrals have the highest retention rate -46% vis-a-vis 33% for employees hired through job portals • Rated #1 for diversity hiring • 1 out of every 5 referral gets hired. Saves time spent on recruitment efforts • Highest quality of hires among all recruitment channels Referral employees have a better cultural fit and turn out to be better team members Guide to a Successful Employee Referral Program
  4. 4. Whom to invite to Participate In the Referral program • Current Employees • Past employees • Network of past and present employees Referrals are 5 times more likely to be hired Guide to a Successful Employee Referral Program
  5. 5. Successful Employee Referral programs • Mobilize participation by rewarding employees with both cash and non- cash incentives • Ensure continuous flow of communication on the employee referral program to ensure top- of-the-mind awareness • Harness the power of social media • Take feedback and review effectiveness for continuous improvement • Introduce gamification within your referral program to boost participation Guide to a Successful Employee Referral Program
  6. 6. Mobilizing participation by Incentivising referral Cash Incentives • Cash rewards are decided based on • industry and company size • position for which the candidate is being referred. • Skill set required, for E.g. some skills may be hard to find in the market or conversely might be in great demand in the industry • Cash incentives should be paid out in 2 tranches • Half the amount when the referred employee joins the organization • Remainder should be paid out when the referred employee completes the mandated probation period and is confirmed Offering employees socially responsible gifts like donations to their favorite charities also acts as a powerful motivator Guide to a Successful Employee Referral Program
  7. 7. Mobilizing participation by Incentivising referral Non- Cash Incentives • This is now increasingly being used by company’s to build engagement and motivation for the referral program • Recognize employee contribution in employee referral programs through acknowledgement at public functions, badge of honor, personalized notes etc • Award non-monetary benefits like an extra paid vacation day, reserved parking space, time out with significant other etc. Offer a small incentive for the very act of referring an employee Guide to a Successful Employee Referral Program
  8. 8. Ensure continuous engagement with Communication Communication plays a very important part in building understanding among employees regarding : • Why should they refer - referral program and its associated benefit • How to go about Referring a Candidate • What to expect, the process steps once you have referred a candidate Participation is likely to spike when employees are made to experience that their contribution makes a difference • The referral program should be communicated in various ways during the entire employee life cycle starting from onboarding and induction right through appraisals and team events, going down to ensuring exiting employees act as brand ambassadors to refer candidates Guide to a Successful Employee Referral Program
  9. 9. Ensure continuous engagement with Communication Build a Buzz around the referral program through Promotional Events – Contests, Competitions and Jackpot Prizes Conduct periodic contests and competitions, bumper draws and reward the winners with coveted prizes like tickets to a popular match / event, opportunity to participate in events / conferences, electronic gadgets etc Generate competition within departments and teams – the team that generates the most referrals converted into hires within a given time period is awarded a team prize like a day out at a resort etc Employees should not only be aware of your referral program, but also excited about it. Guide to a Successful Employee Referral Program
  10. 10. Ensure continuous engagement with Communication Ensure job opportunities are communicated and updated regularly and displayed in prominent gathering places so that it becomes a topic of discussion among employees Build comprehensive job descriptions for open positions containing all relevant information to reduce the number of queries for employees Conduct an employer branding exercise and build the referral program around it. This will help you and your employees sell the company to potential candidates on the key differentiators of your company as an ideal employer. Not every referral will turn into a hire, but each referral contributes to the notion that your organization is an employer of choice. Guide to a Successful Employee Referral Program
  11. 11. Ensure continuous engagement with Communication Maintain a consistent messaging across all recruitment efforts to promote a unified brand. Ensure that employees have the material available to sell the employer brand to potential candidates Ensure that your referral site is easy to access, navigate and extremely user friendly. It will help to have the site architecture displayed at prominent notice boards to facilitate top of mind awareness These initiatives help employees feel valued and involved in the entire process and subsequently builds ownership and positive word-of-mouth for the program One of the most important aspects of a successful referral program is to ensure that employees are regularly updated regarding the status of their referred candidate. This can be through an automated system where the employee can log in to check the status or it can be through mails to employees informing them of the status of their candidates. Guide to a Successful Employee Referral Program
  12. 12. Harness the influence of Social media The following steps will help you use social media effectively to build a successful employee referral program • Social media has now become one of the most potent tools to use both externally to build a connect with end users as well as internally with your employees and their connections Educate employees on the do’s and dont’s of social media, what to keep in mind when creating a profile, protocol of sharing information , online networking, and converting network contacts to referrals. • Build your social media recruiting strategy to create easily shareable content to market your employer brand. This can include link to interesting blog posts or articles, posts to Facebook and Twitter, sharing company updates, major events, team outings, open positions etc. Guide to a Successful Employee Referral Program
  13. 13. Harness the influence of Social media • Training employees on building and managing a stronger, more robust professional network will in turn help them refer more and better quality people. • Educate employees through workshops on how to identify valuable contacts, make solid introductions, establish mutually beneficial dialogues, and determine if and when they should consider referring someone to your organization Its time for you to Stop resenting the time your employees spend on Facebook Guide to a Successful Employee Referral Program
  14. 14. Continuous Improvement through Feedback & Review Measure and Monitor Program effectiveness through • Analyzing new hire matrix • What percentage of hires come from referrals? • What is the turnover rate of referred hires? • How does a referred hire’s on-the-job performance compare to that of hires obtained through other sources? • Nothing is constant and hence even the very best employee referral programs need to be updated to keep pace with technological innovations, macro economic changes, changes in workforce dynamics and company growth curve. Capturing Employee Feedback on • Level of awareness on the incentive program • Ease of using the site • Incentive Rate • Suggestions for improvement Guide to a Successful Employee Referral Program
  15. 15. Continuous Improvement through Feedback & Review • Efficiency of Referral Program • Evaluate and benchmark turnaround time from when a candidate is referred to when the candidate is hired. Explore ways to reduce the time lag to increase the efficiency of the program • Analyze employee participation trends (spikes and drops) in causes for the same • Track trends in technology and linkage to hiring The key question to ask yourself is whether you are getting the best value for your investments in the program, and what is the scope for improvement • Cost of hiring through Referral and other recruitment channels • Average cost per hire for hiring through the referral program • Average cost per hire for hiring through other sources like job portals or agencies • Measure ROI Guide to a Successful Employee Referral Program
  16. 16. The Future lies with Gamification • Gamification spends will grow to as much as $2.8bn by 2016 • 70% of Fortune 500 company’s will use game mechanics at the workplace in some form or the other by 2014 • Gamification offers the flexibility to recognize and reward in a small way for committed efforts to bring in quality profiles that are interview worthy • Majority of employees today would like to work for a brand that is perceived to be fun and playful As per Wikipedia, Gamification is the use of game thinking and game mechanics in a non-game context in order to engage users and solve problems Guide to a Successful Employee Referral Program
  17. 17. About Zalp ZALP is a unique SaaS (software-as-a-service) based social employee referral software designed to help organizations efficiently source the highest quality candidates through the most valuable source of recruitment– Employee Referrals.
  18. 18. About Zalp Empowered with breakthrough features that tap into the full potential of Social Media and an extremely user friendly interface, ZALP is every organization’s perfect Social Employee Referral and Social Recruiting Software. ZALP helps organizations boost their employee referral output by upto 72% %
  19. 19. Why Zalp 7 easy and convenient ways to refer The success of any employee referral program depends on one primary factor: Employee Participation ZALP gives employees not one but seven easy and convenient ways to make referrals. This ensures increased employee participation like never before. ZALP’s social media integrated features make the referral process for employees not only easy but also fun.
  20. 20. For more information, visit To book a free demo, drop a mail to You may also call us for any other assistance 1-866-217- 1267
  21. 21. Do you already have an Employee Referral Program? Get a personalized indexing report for your organization that helps you benchmark your referral program against industry leaders and understand key performance indicators better. Register now » ER-i is the first ever initiative on employee referrals that brings together recruitment leaders from all across the world to set the benchmarks of an employee referral program. Guide to a Successful Employee Referral Program