Are you in corporate Talent Acquisition function? Are you confused as to when Employee referral would work and when it would not? Are you facing a challenge deciding for which vacancy you should depend on Employee referral and for which you should not? If your answer to all above questions is ‘Yes’ then following is for you:-
When exactness is the key – No one else than employees know about their company, its culture, traits, behavior, personality and persona of employees, what will do and what will not. And most importantly whom should they hire. So employees would be very clear that the candidate they are referring would surely be the most right fit in all aspects. Moreover an employee can screen the candidate closely. Employees take it seriously because their own reputation will be on stake on referring a couple of poor quality candidates.
Not When possibility of negative Group-ism is high- If you hire a huge number of referrals from same set of employees, you may end up with creation of group or groups in the office environment which at times would tend to damage company culture. To minimize this possibility, employers should prefer to limit the number of referral per employee.
When long term pipeline building is the focus – Handsome incentive is paid to an employee on successful referral. And it is quite an important morale booster as well. It motivates them to keep on referring on consistent basis that helps the company building relevant talent pipeline. Gradually with the passage of time, pool becomes big.
Not When there is an environment of discrimination is intense – Have a look on this instance. An existing employee has appeared in an interview but the referred candidate got selected. Here there are high degree of chances of existing employee blaming HR of favoritism and discrimination. This becomes more intense when existing employee was competing to get promotion, preferred job location, preferred team or dream role.
When Cost Cutting is significant – Recruitment options such as advertisement in newspaper, taking services of employment agencies, subscribing to job portals, going for job fairs and other such sources are costly affairs when compared to bonus being paid to employees. Hence an employee-referral program, in such situations where budget is a barrier, is quite effective.
Not When search is confidential – Lot of vacancies are such which are highly confidential. It is expected that all in company should get to know about the same once the candidate joins the organization. Such vacancies can never be a part of employee referral. And these are to be filled through employment agencies.
When talent is rare – Pool of super specialized professionals is quite small and hidden. And at the same time, being rare, these specialist professionals are connected quite well since they keep on meeting in conferences and are there in common social media platforms. Hence they have an access to professionals with similar rare skill sets.
Not When time is short – In a situation when time is less you cannot rely on employee referral. Employees would not focus on referring candidates since it is not their primary KRA. They would only do it once they have time for it. Whereas employment agencies and recruitment companies are in full time business of talent search for clients. They are of better use in this time bound situation.
When diversity is not an issue – The diversity of the candidates gets compromised when there is too much dependency on employee referral programs. Employees generally would refer candidates with similar backgrounds. Hence there is a miss on a diverse candidate pool. Various sources must be explored when you need variety.
Not When it is at the cost of relationship with competitors: At times companies in the same business, having good understanding with your company on several things, may strike back and blame your organization for stealing their super performing employees using employee-referral programs.
By Jivan Principal Consultant & Director Career Shapers HR Consulting Pvt. Ltd