Article: 10 steps for productive employee referrals


10 steps for productive employee referrals

The focus of ERPs is often misdirected from the ‘employee’ to the ‘referral’. Let’s understand how to avoid it.
10 steps for productive employee referrals

Shruti is an HR manager of a media company, and she was given the task of finding a suitable replacement for a top talent in one of the departments. Instead of going around in circles trying to find the right one, she decided to use the Employee Referral Program. And within a month, she closed the opening. 

Employee Referral Programs are considered one of the safest alternatives to traditional recruitment practices. The nature of the process is such that employable talent is easily accessible; the quality of the talent can be accounted for, and most of all, since the current employee is acquainted with the company work and culture, they are in a much better place to find a suitable candidate, than a third-party recruiter. However, as any HR personnel can confirm, running a successful employee referral campaign is not a cakewalk. More often than not, the focus of the campaign is diverted from the protagonist in this cycle, the ‘employee’ to almost exclusively on the end product, the ‘referral’. 

Here are some features of an Employee Referral Program that are likely to make it more successful:

Do more than simply communicate

An email saying that the HR Dept. is looking to hire more people and would want you to refer potential candidates in your circle is most likely to be ignored. Appeal to the employee’s point of view, by telling them that new talent in the organisation will help them, and their team grow. Avoid sending them dry emails and discuss the processes and strategies in small meetings and discussions. 

Get your employees excited

The toughest step of the process, getting your employees excited simply means ensuring they proactively look for candidates and applicants in their circle and refer them. Monetary incentives, contests and soft incentives are likely to be the most frequently used tools, but using only such tools is likely to bring down the quality of the referrals. Inculcating a need for referrals, and building a case for the success of the programs needs to be consciously included in the process. 

Train your employees

The only way to ensure that your employees actually put in the required effort, and are excited, is by ensuring they are equipped with the knowledge and resources of going about the process. Training the employees on how to increase their referrals, establishing contact, pitching the organisation and job, using social media to identify talent, current talent needs, and interacting with the person before and after the hire is important. Furthermore, details like how to make a referral, methods and timing of granting of bonus or benefits, and whom to approach in case of obstacles must be clarified. 

Timing is essential

Timing the process and the steps in it is critical. Clear some time off in the week only to conduct the referral program, for otherwise it will always be a secondary task for the employee. Additionally, close the time gap between a referral being made and initiating contact. If the present system of referrals is time-consuming, which results in a backlog of referrals sitting in your ATS or database for prolonged periods, using technology to automate the process wouldn’t be such a bad idea. Allocate the amount of time in the entire process, wherein the focus will be on training, referring, interviewing, appointing, and assessing. 


A major tool to get your employees excited about the program is by giving bonuses for referrals and hires. However, offering non-cash rewards like reserved parking spots, discount coupons, movie tickets, dinner vouchers etc. has shown to work as well. To further improve success rate, design an internal contest of sorts, to increase competition, with a bigger reward at the end of the road, for example a weekend vacation. If the budget doesn’t allow that, other ideas like lunch with the CEO, or publically appreciating employees can be considered.  The idea is to identify and recognise people who have given it their best, and motivate them further. 

Periodic Referral Events

After announcing and initiating the programme, it is essential to maintain a dialogue with the employees. Set up lunches, open houses or informal meetings to establish the progress, needs and problems and rectify them. These opportunities can also be used to transfer knowledge, training material, gauge the participation level, and allow for employees to update you on new referrals. Sending emails and communication in a black hole post launching the program will not garner any results. 

Employer Branding

No matter how big or small your organisation is; you must equip your employee with tools and resources to pitch your company to the prospective applicant. In other words it means a clear understanding of company processes, job descriptions, and achievements. Integrate this communication into the social media space, with a blog or video series describing the workplace, the ideal employees, the work done etc. Creating special electronic communication material with a motivating slogan or tag line to encourage referrals to apply actually makes a difference. 

Simplify the process

If you have managed to get your employees interested, but they have to fill several forms, contact many people or undergo a time-consuming process to make a referral, they will not do so. Remember, this exercise needs to be built around the company culture and space, and unduly complicating the process will attract poor results. The process of making a referral, following up on the progress, and enquiring about the bonus or benefits must be made very easy. Repeat, very easy.

Close the loop

Notify the employee if the referral was hired or not, along with when and how they will be receiving the bonus. It is essential to let the team know how many referrals came in, how many were hired, who got the maximum referrals and what is the future plan. Hand written/emailed ‘Thank-You’ notes can be sent to employees, based on their record, to recognise their participation. The entire program doesn’t end until the last referral that has been selected joins the organisation, and the last employee who made the referral is rewarded. 

Assess the metrics

Once the cycle is over, attribute the success and failure of the program. A first-time lukewarm response should not considered a reason enough to give up on the process. Monitor which strategies worked best, and talk to employees that participated enthusiastically and those who didn’t, and assess their reasons for the same. A review of the process is an obvious way to end it, but quantifying the results will give you a case to restart or renovate the program, the next time around. 

It has been proven time and again that Employee Referral Programs are one of the best sources of talent, and give added financial benefits to the department or organisation by improving employee relations and engagement, and improving retention rates. That being said, success in executing the program is often illusive. If there is one take-away from the many companies that have attempted to leverage their existing employee’s circles to acquire talent, it is that the program requires unequivocal attention and focus, and cannot be run on the sidelines. The organisation needs to exclusively focus on the processes and steps on the program to ensure that the desired results are obtained. The above listed points are a great beginning point for the inception of an Employee Referral Program in your organisation. 

Let us know how Employee Referrals work in your organisation, and how successful they have been.

Read full story

Topics: Recruitment, Employee Relations

Did you find this story helpful?



How do you envision AI transforming your work?