Improve Referrals Dramatically – Transform Them Into “Talent Recommendations”

A primary flaw in referral programs is allowing employees to refer “strangers” that they barely know. Employee referrals are by far the #1 hiring source, both in volume and for quality (i.e., on-the-job performance). However, I have found that the performance of these programs may improve by as much as 25% with one single action. By not allowing employees to refer people they hardly know.

This is a major problem because everyone in the hiring process automatically assumes that the employee knows the referred person well and, therefore, they are, in effect, recommending them to the company. In roughly 37% of all referrals, that can’t be true. Because in one study, this stranger only approached them out of the blue and asked them less than subtly to, “please submit my resume as a referral.” I call them “they found me” or “junk” referrals. And you must avoid allowing your employees “to mislead the hiring team” by taking these 3 simple steps.

Step A – Make the goal “to help the team” – make it clear that every employee is expected to accept the role of “talent scout” for the company. And as part of that role, they should contribute referrals with the primary goal of “helping the team.” So that employees can and will only make a referral if that person will clearly improve team performance. Because the target demonstrated superior performance, skills, experience, capabilities, and interest in the company. Referrals are never to be made “to help a person out,” for a stranger, or just to earn the referral bonus. Your manager will judge your commitment to their team based partially on how well your submitted recommendations have helped the team.

Step B – Begin calling referrals what they should be called… employee recommendations – stop using the term referral altogether. Because, to many employees, it means little more than the “submission of a name for money.” Instead, the label is “an employee recommendation,” with the weight that this term infers. And make it clear that this recommendation will reflect the company’s overall assessment of this employee’s judgment. Also, make it clear that a second weak or questionable recommendation may result in losing this employee’s privilege to recommend.

Step C – Require these four declarations showing that the employee fully “knows” this person this is by far the most important step. For any recommendations to qualify, the employee must declare on the submission form that their recommended person passed each of the following four assessment areas. These declarations ensure that we are not “hiring strangers” and that the employee has thoroughly and completely vetted the potential employee before any recommendation was submitted.

  1. Declaration A – That they have done exceptional work – proactively educate your employees to be on the lookout for exceptional work (above the team’s current level) during their reading and learning. The recommending employee must declare that they have fully assessed the prospect’s actual work. Simply “hearing about their work” is not acceptable. 
  2. Declaration B – They will add superior skills – educate your employees so that they are only seeking individuals who also have exceptional skills (i.e., higher than the current team’s average skill level). Or the advanced “future skills” that the team will soon need. The employee must declare that they have fully assessed the prospect’s actual skills and capabilities.
  3. Declaration C – There are no obvious “fit issues” – educate your employees so that they only target potential candidates with no major “fit issues” that are likely to cause disruption. Also, ensure that all recommending employees realize that innovative and diverse new hires may not always be “perfect fits” initially, but most will adapt later. The recommending employee must declare that they have thoroughly assessed their likely fit with the team. and that they are “a positive fit.”
  4. Declaration D – They are committed and willing to be interviewed – the fourth required declaration covers the fact that the recommending employee has “sold” this prospect. To the point where they have already agreed to accept an initial interview. This is essential because recruiters simply don’t have the time to waste on candidates still unsure that they want to devote their time to an interview.

Final Thoughts

It’s essential during today’s business downturn that every one of an organization’s limited new hires is a high-impact hire. So do that by rebranding your referral program. And then, require each employee to recommend someone who has done superior work, has superior skills, and is committed to exploring an opportunity with your organization!

If you only do one thing – change the name of your current referral program so it reflects the greater emphasis the corporation is placing on getting fewer but higher quality “employee talent recommendations.”

Author’s Note

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About Dr John Sullivan

Dr John Sullivan is an internationally known HR thought-leader from the Silicon Valley who specializes in providing bold and high business impact; strategic Talent Management solutions to large corporations.

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