7. 7
My goals for today…
1. To demonstrate the business
impacts of referrals
2. To expose you to dozens of
proven action steps that can
increase your ERP results
to 50%
8. 8
What are the business reasons
for focusing on referral programs?
Part I
10. Referrals are #1 in volume
Source popularity Volume
1. Referrals 28.0%
2. Job boards 20.1%
3. Career site 9.8%
4. Recruiter initiated 9.1%
5. College 6.6%
6. Rehires 4.3%
7. Social media 3.5%
8. 3rd party 2.8%
9. Print 2.2%
10. Temp to hire 2.1%
11. Career fairs 1.9%
12. Walk-ins 0.8%
Source: CareerXroads 2012
11. 11
Referrals are a high volume source
Reached 90% of it’s hires from employee referrals
Ernst & Young and Deloitte’s ERP’s both reached
approximately 50% of all hires last year
13. 13
#1 in quality of applicants
In a survey of 73 major employers… 88% said
that… referrals are the # 1 best source for above
average applicants
Source: 2006 DirectEmployers Association/BoozAllen Recruiting Trends Survey
14. 14
High quality applicants
Although only 7% of job applicants came from
employee referrals
A whopping 40% of ERP candidates get hired
Source: 2013 JobVite Survey
15. 15
High quality applicants
Referrals have the highest interview to hire ratio
Data analysis by SilkRoad reveals that 17% of
referral applicants are interviewed
And 25% of those interviewed are hired (#1)
Source: Silk Road 2013
http://blog.silkroad.com/?utm_source=TLNT&utm_campaign=ec74d7751a-tlnt-daily-most-of-your-job-applicants-really&utm_medium=email
17. 17
Referrals are #1 in quality hires
Source effectiveness /quality of hire
1. Employee referrals
2. Large job boards
3. Niche job boards
4. Temp to perm
5. Recruiters
6. Trade media
7. Staffing services
8. College recruiting
9. Career fairs
10. Co-op education
11. Mass media
12. Military
Source: staffing.org 2011
18. 18
Referral produce more profit
Referral hires produce more profit
Hires from referrals produce a nearly 25%
higher profit… than hires from other sources
Source: “The Value of Hiring through Referrals” (source: UC Berkeley by Burksy, Cowgillz, Holman and Housman
http://faculty.haas.berkeley.edu/bo_cowgill/papers/Referrals.pdf)
20. 20
Retention results
Referral hires have higher retention rates
Referred workers are between 10% and 30% less
likely to quit than workers hired from other
sources
Source: “The Value of Hiring through Referrals” (source: UC Berkeley by Burksy, Cowgillz, Holman and Housman
http://faculty.haas.berkeley.edu/bo_cowgill/papers/Referrals.pdf)
22. 22
Benchmark firms that you can learn from
AmTrust Bank
Deloitte
Edward Jones
Accenture
Ernst & Young
DaVita
Aricent
Children’s Hospital
Owens Corning
Accolo
CACI International
Acumen Solutions
25. 25
Strategic action #1
Focus ERP efforts on high priority jobs including:
Mission critical jobs and business units
Revenue generating jobs
Jobs with a high previous referral success rate
Hard to fill jobs
“Sudden” key vacancies
Tip – begin with a shortlist of targeted jobs and
then add positions
26. Prioritize the employee
with the closest relationship
Accolo uses a referral community
For every open job, it selects a few employees
based on the likelihood that they will know the
right person
As a result, Accolo has averaged 8 referrals for
every job (#1)
26
28. 28
Prioritize your employees
Focus on referrals from top performing employees
Why? Because referral hires from top performers…
produce nearly 3 times more profit… compared…
to a referral hire from a below average performer
Seek out and prioritize referrals from top
performers
But also… warn, restrict or ban employees that
routinely make weak referrals
Source: “The Value of Hiring through Referrals” (source: UC Berkeley by Burksy, Cowgillz, Holman and Housman
http://faculty.haas.berkeley.edu/bo_cowgill/papers/Referrals.pdf)
30. 30
Strategic action #2
Use “help the team" motivation (not $)
The most effective referral motivation approach
emphasizes the opportunity to work alongside
great people… because the team wins more
frequently… when it has the best players
31. 31
Strategic action #2
You can build a “help the team” mentality… by
emphasizing these benefits to employees
Higher quality hires will improve business results
and thus raise employee stock value and bonuses
It’s part of the responsibility of being a team player
You will be recognized for “helping the team”
You will learn more from higher-quality new hires
You won’t have to work alongside slackers
Note: A feedback loop is required to tell employees
whether they made a “junk” or a “star” referral
Also show them the correlation between improved
business results and a higher % of ERP hires
32. 32
2 examples… referrals don’t require $ bonuses
Reached and maintained a +70% referral rate
with no $ rewards
Edward Jones reached 55% with no bonus
34. 34
Strategic action #3
Why you need to be proactive?
“Great people know great people”, however most
employees are extremely busy…
so to maximize your referrals… you will need to
proactively approach your top referring
employees
Here are 3 proactive ERP tools to consider
35. 35
“Proactive” referral tools
A) Give me 5 – Proactively approach top employees
Ask them to identify and then contact the…
Best manager they ever had
Best team leader
Best idea person or innovator
Best person that "runs into" burning buildings
Best problem solver
Best sales person that beats you
Best student in college that was so smart
Best mentor
Best technical skilled person
Best international talent
Best customer service person
Best external replacement for you when you’re promoted
36. 36
“Proactive” tools
B) Reach out to job references for referrals
Identify top performing hires from last year
Call their references that said accurate things
Thank them
Ask them “Do you know anyone else as good?”
Ask them to be a future reference source
37. 37
“Proactive” tools
C) “Most wanted list” for relationship building
Executives identify… a list of gamechangers
and potential “magnet hires” at the beginning of
the year
Employees are asked to seek out these highly
desirable individuals and to build a relationship
with them over social media (Relationship recruiting)
When they eventually agreed to consider becoming
a referral… speed hiring is required
39. 39
Strategic action #4
Broaden the program
Add on-boarding referrals – proactively ask new
hires for referrals during on-boarding (Eli Lily)
Add college referrals – the college population is
well connected through social networks, so add a
referral sub-program for college hires and interns
(Endeca, Intuit)
Add referrals for executive positions – advanced
ERP’s also cover openings for executive positions
Focus on boomerangs – encourage your
employees to target your best corporate alumni…
(also allow them to make referrals)
40. 40
Strategic action #4
Broaden the program
Add internal movement referrals - have a
referral program that is designed to encourage
internal movement. The best practice firm Booz
Allen has a “Career mobility” team (Also MS,
Cisco)
41. 41
Expand program eligibility
Expand eligibility
Executives are encouraged to refer - a “white
glove treatment” recruiter can be assigned to
encourage executives to make referrals (Deloitte)
Managers and HR are made eligible – managers
and those in HR are also well connected, so they
should be eligible to make referrals (Accenture)
Note: you can help minimize conflicts of interest by
offering the option of contributing any ERP reward to
charity. It can also be a significant motivator for those
that are not driven by bonuses (Accenture, DaVita)
42. 42
Expand eligibility
Expand eligibility to non-employees
Open up referrals to non-employees including
Family
Contingent workers
Consultants and vendors
Customers
Board members
Corporate alumni
(Internosis, Clearlink, CACI, Verinon)
43. 43
Next: A long list of
tactical action steps that can
dramatically improve results
45. 45
Best practices for increasing referral volume
Hold referral events – hold physical referral
events and “virtual meetups” in order to garner
attention, to educate, and to get "spot" referrals
(Monster.com)
Alerts – send targeted alerts to the most relevant
employees with a successful referral track record
in order to make them aware of your current need.
(CACI International and Quicken Loans)
Competition – friendly internal contests between
teams can dramatically improve results (Deloitte)
46. 46
Best practices for increasing referral volume
Harness social networks – closely integrate
referrals with your firm’s social media effort
Recognize managers – set targets, make it a
promotion criteria and then… track, report,
recognize and reward individual managers for
high referral rates within their team
47. 47
Increase volume by requiring less upfront
Accept profiles – at least initially, allow LinkedIn
profiles in lieu of resumes
Accept just names – instead of requiring the full
resume, accept names only (Children’s hospital in
Dallas pay $100… just for name in key jobs…
even if they are not hired… and 25% of the names
result in a hire)
49. 49
Education and help
Provide them with hands on help
Provide virtual “referral coaches”
Offer sample social media profiles and provide
templates that can guide employees on how to
develop contacts and relationships online
Offer to critique their profile or their blog
Provide them with stories – develop "story
inventories" that employees can access and then
use to "sell" the firm to potential referees
50. 50
Google has a story inventory
A story Inventory for recruiters and employees
53. 53
Setting clear expectations can limit junk referrals
Expectations before an employee refers (guidelines)
1.We are exclusively seeking superior individuals
that will make our firm significantly better
2.Because we only want the very best… we expect
no more than 3 referrals per employee a month
3.Throughout the referral process… we expect you
to put the firm’s best interests first
4.Except in extraordinary cases, we do not want
referrals from relatives or individuals that
approached you and asked to be referred
54. 54
We need the following information
Provide the following 6 pieces of information
1. The job title or req # you are referring them for
2. How you know or have assessed their work
3. Assess and then tell us about their skills and
knowledge… and how they are superior
4. Assess and then tell us about their cultural fit…
so we do not dilute our culture
5. Assure us that you have sold them to the point
where they will accept an interview, if asked
6. Honestly rate them with a A+, A, or B+
56. 56
Referral cards can be powerful
Your customer service just now was exceptional.
I work for the Apple store and you’re exactly the
kind of person we’d like to talk to.
If you’re happy where you are, I’d never ask you to
leave.
But if you’re thinking about a change, give me a call.
This could be the start of something great.
57. 57
Electronic versions of referral cards
Electronic referral cards
An alternative is to provide employees with
electronic referral cards to send to their social
media contacts (the cards can have a tracking code
to ensure that the employee gets credit for the
referral)
59. 59
Rewards
Action steps for improving rewards
Realize that the average bonus amount generally
falls between $500 and $1,500…amounts above
$1,500 have proven to have little impact
The best ERP’s never pay "equal" bonuses and
most vary it by job, location and competitor $
"Grossing up" bonuses (so that they are in effect
tax-free) really WOW’s employees
Pay off quickly and consider a “prize patrol”
approach to add excitement (Quicken)
60. 60
Rewards
Inexpensive rewards to consider
A referral dinner/luncheon held once/ twice a
year with the CEO to celebrate referrers
A $25 gift / Starbucks card for your 1st referral
A handful of free movie tickets for the family
First choice at vacation, schedule or other
desirable work items
61. 61
An example… rewarding frequent referrers
Expedia’s frequent hire club
$1000 plus a travel coupon for each additional hire
63. 63
Referral technology features
Impactful technology features
1. Referrals are tagged and prioritized in the ATS
2. The referring employee gets an e-mail “thank
you” within 24 hours
3. The referred candidate gets a “thank you”
phone call within 24 hours
4. The employee is notified via e-mail when a
referral is scheduled for an interview
5. Interviews can be scheduled by the candidate
on a web site (Alaska Airlines)
6. Relevant job openings are “pushed” to the right
employees (With their permission)
64. 64
Technology features
Technology features (continued)
6. Employee referrals can be made directly from
their mobile phone
7. Referring employees have a referral scorecard
8. Employees and candidates can track progress
during the process (Accenture & Aricent)
9. A+ and A “rejects are told what they must do to
improve their chances
10.An e-newsletter is sent quarterly to A+ and A
rated referrals that were not hired… in order to
build a relationship
66. 66
Administrative actions to consider
Improve responsiveness – responsive is the #1
critical success factor so… prioritize the handling
of referrals and develop service level timelines
Dedicated recruiters – a dedicated ERP
recruiter can improve candidate relationship
management (CRM) and much more effectively
sort and expedite top referrals (CACI)
Expedited interviewing – make a commitment
to interview all A+ and A quality referral
candidates for key jobs within a certain number of
days (Owens Corning)
67. 67
Administrative actions to consider
Measure quality of hire – measure the on-the-job
performance and the retention rates of new hires
from referrals… and then use the information to
improve the ERP
Conduct a follow up interview – after a
successful referral, send a recruiter to interview the
employee in order to identify best practices and to
ask for additional referrals (Amazon)
Develop a referral program SLA – increase the
responsiveness of both line managers and HR by
instituting service-level agreements that spell out
expectations. (Aricent)
69. 69
The 4 most impactful program killers
Do not allow executives to win the argument that…
you don’t need a formal ERP program and
marketing effort… because “it’s part of their job”
Do not withhold rewards during the new hires
probationary period
Avoid “referral spam” where a high volume of
messaging causes your targeted employees to
eventually ignore all referral messages
Avoid sending employee referrals to apply on
the standard corporate careers website (not tagged)