Many successful startups have an employee referral program that rewards current employees for recommending a friend who eventually gets hired. Due to the incentives, it can get expensive, but it’s also a great way to attract top talent. How do you know whether this a good choice for your business?
Here are a few questions to ask yourself to analyze whether a referral program is for you.
Should you have an internal referral program?
- Can you afford the incentives you’ll need to offer to get good referrals?
- Does your HR team have the time needed to review additional applications?
- Do you have openings you need filled?
- What is your hiring culture? Are you always open to adding top talent, or do you want to focus on training and developing your current team?
- Do you have enough work and tasks to fill the time of another hire?
- How happy are you with your current team? Would you be happy with additional hires of the same caliber as your current team?
- What types of incentives can you afford? If not financial, can you give successful referrers days off or opportunities to work from home?
Tips on executing your employee referral program
If you’ve decided to implement a referral program, keep your employees involved throughout the process. Don’t forget to give recognition to the employees who recommended your new hire. It improves morale, encourages others to recommend people they think would be a good fit, and keeps the referral program top-of-mind.
Finally, don’t forget to measure the success of your program. Look at the percentage of your team who was hired by referral, how many candidates apply due to referral, the quality of overall referrals, and how much of your total workforce has participated in the referral program.