What’s the best referral incentive, a 1000 pounds or company recognition? I had the pleasure of speaking with the one man who might know the answer – Nasser Oudjidane – the co-founder and CEO of the HR startup Intrro. Their platform uses machine learning to help companies scan employees’ professional networks to identify referrals. Nasser was guest on the Coffee with a Recruiter podcast and shared his perspective on how to improve referral programmes. Here are the main takeaways!
Why should you have a referral programme?
Referrals reduce time to hire, cost per hire, increase retention and increase offer-acceptance rates. Referrals contribute to the overall happiness of an organisation and the bottom line.
Building a referral culture
(A referral programme) doesn’t get off the ground unless you have a strong brand and high engagement in your organisation.
Employees are hesitant to provide referrals if their company’s culture is toxic, so it’s important to create a culture of belonging. You can improve your culture by focusing on your basics: mission, vision, values and culture. You can also ask your employees about your culture and what you can improve.
Optimising your outreach
Employees may not have the strongest recruitment skills and are not informed on how to write good copy.
It’s crucial to provide the right messaging to coworkers and referrals. How do you do that? Tools can help you set reminders to make your employees aware of the process and the status of who they’ve submitted. Company leaders can also help with communicating the referral system to get participation from the business and not just a small pool of very dedicated employees.
Creating a system of records
The last thing you want is for your referral programme to turn into a black hole where CVs disappear, and referral providers are asking: hey what happened to that CV I sent?
To avoid negative feedback, you can create a system of records to create trust with your employees. This can also provide information for persuading management in promoting the use of referrals.
Get the incentives right
The most motivating and cost-effective way to incentivise referrals is to recognise the referring employees for their work.
You can show recognition to your employees by sharing stories publicly of them bringing referrals. Experiences can also be great motivators. You can also include a monetary incentive for referrals. But how much should you offer? A good ballpark figure is between 1000 to 5000 dollars.
Be careful though! Monetary incentives can lead to employees referring mismatching contacts only to collect a high referral bonus.
As much as I’d want 1000 pounds, I’d have to go with company recognition to avoid bringing the wrong candidate! It was great catching up with Nasser and discussing his thoughts on referral programmes. Listen to the episode for more information or check out the links below. Thanks again, and stay safe.