Dr John Sullivan Talent Management Thought Leadership
When new-hire referrals are ignored, wait 3 months to request them. Yes, most are surprised that a simple 3-month delay has such a dramatic impact on your referral results.
Referrals are, of course, the undisputed best external source for high-performing hires. Yet in reality, few companies actually receive many successful referrals from their new hires.
First, because most companies don’t have a formal process for automatically requesting referrals from their new hires. But also because of their newness to the company, most of the referrals from new employees are automatically rejected as “not being a good fit,” simply because the new hire has yet to prove their talent assessment credibility.
However, if your new employees delay making their referrals until after they have learned the culture and demonstrated their performance to their team, the volume, quality, and the acceptance rate of their referrals will improve dramatically.
So, this article highlights the many reasons why this simple 3-month delay under the “Delayed Referrals From New-Hires” strategy is so impactful.
The Top 5 Reasons Why This Delay Is So Impactful
It’s true that only in rare cases do companies routinely ask their new hires for referrals during onboarding. However, when they do ask, unfortunately, almost all of these new-hire referrals will literally die in your hiring funnel.
After years of research, I have discovered multiple reasons why a 3-month delay in asking for referrals has such a measurable impact on your results. The top five impacts from this delay include:
- After months of learning about the company, the referrals from recent hires are now more likely to be taken seriously – the primary benefit from a multi-month delay in asking for referrals. This waiting period will increase the level of trust that your company’s insiders have in this new employee’s ability to assess talent. These months of watching the recent hire perform will show everyone that they fully understand the culture, and hiring managers and recruiters will be much more willing to end their automatic discounting of a new employee’s talent recommendations.
- After the delay, recent hires will be less hesitant to make referrals – during their first week, it’s only natural for new hires to hesitate before they make any referrals. Primarily, their loyalty to their former colleagues will make them reluctant to make a referral too quickly. This reluctance will likely remain until they are sure that they are referring them to a great company. The delay will allow recent hires to make a more accurate assessment of the company and increase the number of referrals that they make.
- The delay will provide time for the recent hire to come up with more and better names – in most cases, new hires will be so busy and confused during their first week that they will not be able to come up with their best list of referral names. However, after 3 months of thinking about who they should refer. Most of your recent hires will be able to come up with between 5 and 10 “fresh names” (i.e., not seen by your recruiters) to add to your company’s sourcing funnel.
- After the delay, their referred colleagues will be more willing to apply – it’s also true that after working within the company for 3 months. The new hire will better understand the company’s and the team’s strong and weak points. And without a more complete understanding, those on the list of former colleagues will be much more likely to trust their former colleague’s assessment of whether this is a good company, team, and job that is a great fit for them personally. And with that added level of trust, a larger percentage of the referred former colleagues will be willing to apply at your company formally.
- With increased buy-in, junk referrals will drop – the delay before referring will also provide the new employee with a higher level of team and company buy-in. And with this stronger buy-in and commitment to their colleagues. All recent hires will be much less likely to make a “junk referral,” just for monetary or friendship reasons.
Appreciating The Many Benefits That “Delayed New-Hire Referrals” Produce
When you study, as I have, which category of employee referrals usually receives the highest recruiting priority. You find that referrals from your top-performing employees (working in critical jobs) receive the most attention.
But surprisingly, on the other end of the spectrum, you also find that most companies get only a minuscule percentage of their successful referrals from new hires.
However, I have found that if you ask them for referrals at the right time, you’ll be pleased to learn that these delayed referrals will quickly provide a measurably larger percentage of successful referrals. The most impactful benefits that you can expect include:
- You’ll receive an insider’s list of desirable talent – a new hire from a top company will provide your sourcers with “an insider’s list” of pre-identified top talent. And in most cases, that list won’t cost you a dime because you don’t need to offer a referral bonus when the recent hire only provides you with names.
- Those on these referral lists won’t be active job seekers – those who appear on these referral lists will be even more desirable. Almost everyone on the list won’t be an active job seeker (the hardest-to-reach top candidates), nor will they be unemployed. So recruiting them will give you a competitive sourcing advantage over those companies that can mostly only attract active job seekers.
- Those on the referral list will be pre-assessed – unlike a list of names you might get from a company directory on the internet. Those that are on one of your referred name lists will already have been thoroughly assessed and vetted by your recent hire. And that assessment will cover both their talent and their company fit.
- The referred individuals will be easier to sell – because before listing a former colleague as a referral. Most of your recent hires will first make an attempt to sell them on the opportunity. And that pre-selling, coupled with their relationship with their former colleague, will likely mean that these referred candidates won’t require much selling or cajoling during the hiring process or after the offer is made.
- Most recent hires will be eager to contribute – after months of working closely with their new manager and teammates. As a form of payback, most new hires will be eager to increase their contribution and to show their gratitude and loyalty. So it won’t take much effort to get your recent hire to make a number of quality referrals.
- You will have fewer frustrated recent hires – because at most companies, new-hire referrals are essentially ignored. The new hires that do make referrals often become frustrated when nothing happens to the referrals that they are extremely excited about. However, in direct contrast, the delay earns the recent hire much more talent assessment credibility among hiring managers and recruiters. Only a small percentage of your recent hires are likely to become frustrated after making their referrals.
Implementation Steps
Because the delayed referral concept is so intuitive, implementing this strategy isn’t difficult. It won’t require any budget expenditures or modifications to the existing hiring or onboarding processes.
It does, however, require three actions. First, each new hire must be told after they accept and again during onboarding of the company’s expectation for a handful of quality referrals after three months. Next, a tickler reminder must be placed in both the hiring manager’s and the recruiter’s scheduling app, so they are automatically reminded after three months to formally ask their new teammate for referrals. A third required action is to develop performance metrics for the program. A final option to consider is prioritizing your jobs and/or the companies that your program targets.
Note: Learn more about how to generate more referrals from your own team here.
Final Thoughts
The highest volume of employee referrals typically comes from your most experienced employees. It’s easy for those in recruiting leadership to fail to grasp the value of referrals that instead come from new hires. However, after you look closely at the eye-popping cost-benefit ratio of this strategy, it would clearly be a costly mistake not to take full advantage of this easy-to-implement and highly valuable opportunity. It will provide your function with still another recruiting competitive advantage.
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Notes for the reader
This is the latest article from Dr. Sullivan, who was called “the Michael Jordan of Hiring” by Fast Company.
Please help spread his ideas by sharing this with your team/network and posting it on your favorite social media.
