Whether you’re an employer or employee, inbound marketing is one of the most effective ways to attract new talent. However, with so many options for how these programs can be run, it’s easy to get overwhelmed and lose focus on your goals. The best way to create a successful referral program is by focusing on what works, not what doesn’t work. This blog will walk you through exactly that. The most challenging aspect of establishing an employee referral program is ensuring long-term success. While referral programs may generate a lot of buzz and enthusiasm at first, keeping them going can be challenging in the long run. You’ll know how to develop a program that keeps workers interested and achieves consistent outcomes month after month after reviewing our “how-to” procedure. An effective employee recommendation program will speed up the recruiting process, lower employee turnover, and strengthen relationships with current workers.
The Simple Steps to Setting Up an Employee Referral Program
Creating an employee referral program can be enjoyable and simple when done right. It takes some time to make a Vision and define your objectives, but it’s simple once you get started. One easy poll will help you figure out what inspires your staff. The most enjoyable aspect of promoting a program is promoting it. It requires preparation, but it may be pleasant and straightforward to do. It’s fun to develop new ideas on how to organize a formal launch. It’s also easy to praise staff for their efforts and arrange contests. A software product like JazzHR may be pretty helpful on the technical side. JazzHR is a software application for recruitment that recognizes the value of employee recommendations. It includes a tool for setting up and managing a company-wide job recommendation program. A specific software application may greatly simplify the process of building and administering a program.
Parts of Creating an Employee Referral Program That Are Difficult
It’s not all sunshine and rainbows when putting up an employee recommendation program. While there are some enjoyable contests and rewards, certain parts may be aggravating. The most challenging aspects of building one are budgeting and long-term administration. You must budget appropriately while attempting to encourage your personnel. If you only have $1,000 to spend on the program, it won’t be easy to persuade workers to submit more than one or two recommendations. You should also budget for party planning and other promotional activities. Your program will fail if you cannot put up an adequate budget. It’s simple and enjoyable to come up with the early incentives. However, long-term program management necessitates continual innovation with fresh rewards and incentives. Long-term, this may be challenging and demanding. Your program might rapidly fizzle out if you get complacent. Every month, you must encourage your personnel for your program to continue to provide results.
Steps to create an employee referral program:
Step 1: Make a Strategy.
Employee referral programs must be carefully prepared before being implemented. Creating a program without a vision, aim, or budget is ineffective. Instead, you offer your team a clear intended goal by making a plan, and you’re more likely to obtain the outcomes you want.
- Create a Vision
Consider your vision for your employee referral program before making a specific strategy. What is the purpose of an employee referral program? What difference will this make to the onboarding process? What are your objectives? You’ll be much more driven to follow through and construct a terrific strategy if you figure out your “why?” Employee referral programs are created for a variety of reasons. Consider your unique motives for doing so. You could desire a greater retention rate, a speedier recruiting process, or an easier onboarding procedure. Employees employed via recommendations are significantly more likely to remain at a firm for a more extended period than those hired based on a cold job application. Candidates who were referred had a better likelihood of getting recruited than those who applied without knowing anybody. Employee recommendations reduce the amount of time spent on applicant screening, resulting in a quicker recruiting process. Make a list of all reasons you want to start an employee referral program.
- Identify Hiring Requirements
The next step is to figure out precisely what you need to hire. Make a list of your responses to the following questions. What position(s) are you looking to fill? For which role are you having the greatest trouble locating qualified candidates? What kind of applicant do you want to hire? Answering these questions will help you understand your program’s hiring objectives.
- Employee Motivation: What You Should Know
It’s helpful to have a sense of what drives your staff before creating precise objectives. For example, it won’t be easy to encourage workers who are simply interested in extra vacation time if you design an employee referral program focused exclusively on monetary incentives. Asking your staff via an email survey is the most excellent approach to learn what inspires them.
- Define specific objectives.
It’s time to become precise after developing your vision, determining what jobs need to be filled, and determining what inspires your personnel. Next, make a list of the goals you wish to achieve with your employee referral program. Again, these objectives should be precise and time-bound. “Give us more prospects to pick from and make the recruiting process cheaper,” for example, is a terrible example of a program aim. “Attract five new qualified applicants for the Portfolio Manager post by March 31,” for example, might be a better example. In Q2, cut the cost per recruit by 25%.” The first example is overly general, but the second and third examples establish particular goals to fulfill.
- Budget
Finally, you’ll need to set aside money for your program. While employee referral programs lower the cost of recruiting new employees, you must account for the cost of referral incentives. If you only have $300 to spend on the program, you can’t offer an employee a trip to Hawaii. Before creating your perks, figure out how much money you must pay.
Step 2: Create a Program.
It’s time to start constructing your employee referral program after you’ve come up with a strategy. But, first, create explicit rules, define referral benefits, and automate program duties. These three stages will guarantee that you construct a successful program.
- Define the terms “referral bonuses” and “referral bonuses.”
The first stage in creating your program is determining which incentives your workers are eligible for. Cash rewards, vacation days, business awards, and charitable gifts are examples of these. Don’t be scared to use your imagination while making them. Create incentives based on the comments you got in Step 1 to encourage your staff to provide recommendations. Make your bonus descriptions as precise as possible. Employee referral cash prizes typically vary from $1,000 to $5,000. It’s considerably more compelling to promote a “$3,000 cash award” than it is to promote “a huge cash prize.” You might give them a $500 gift card to a day spa, three more vacation days this year, or a front-page mention in your corporate newsletter. Be explicit about anything you’re talking about.
- Make sure your rules are clear.
After defining your bonuses, you need to Make sure your rules are clear. so employees don’t take advantage of the program. Rules also show your employees what to expect, how they can help, and how they receive their defined bonuses. If you’re having trouble coming up with a list of program rules, ask yourself the following questions.
- Is it possible for any employee to make a referral?
- Is there a need for the employee is at a specific level within the company?
- Is there a requirement that the employee has worked for the firm at a particular time?
- Is your staff rewarded for suggesting suitable prospects or solely for successful hires?
- What is the maximum number of recommendations that an employee may make?
- What is the procedure for an employee to submit a referral?
- When do the bonuses start to accrue?
- Is it necessary for an employee referral to work at the firm for a certain amount of time before receiving a bonus?
Keep the program’s rules short and straightforward. If there are too many complicated restrictions, employees will be less inclined to join. If you don’t set clear standards, you can wind up with workers who keep referring unqualified friends to earn incentives. There’s no need to go crazy here, but the regulations list should be included in the advertising materials.
- Program Tasks Can Be Automated
Managing an employee referral program should not take up a lot of your time. If you’re disorganized and don’t automate activities, though, you’ll wind up spending much more time on it than you intended. We suggest JazzHR’s recruitment software since it includes a tool for building and administering company-wide employee referral programs, which will save you time.
If you’ve never launched an employee referral program before, using technology like JazzHR may be quite beneficial. Task automation can save you a lot of time, and a specialized tool will help you structure your program design and execution. In addition, JazzHR offers a 21-day free trial, allowing you to try it out before making a final choice.
Step 3: Advise Employees.
Once you’ve built an employee referral program, let your workers know about it. This is an important step. If no one knows about the referral program, no one will suggest applicants to you. Employees may be informed in a variety of ways. It’s critical to have a formal launch so that everyone is aware of what’s going on. You may then be creative with how you market it.
- Have a Public Launch
It would be best if you had a Public Launch once the program goes into effect. It’s important to convey the newness and excitement of the program. You can do this by email, but it will build greater excitement if done in person. Schedule an official launch party, have the CEO announce it at a company-wide meeting, or host a company lunch to announce it.
- Utilize your imagination.
After your official launch, it’s time to Utilize your imagination. There are countless ways to promote an employee referral program. The goal is to create excitement and remind employees what’s in it for them. Work with the marketing department to create promotional posters with bonuses visible. Send weekly emails to remind employees and give them updates. Set up departmental competitions. People are competitive by nature. On the month’s final day, the department with the most recommendations is treated to a pizza party. Organize referral parties. Notify everyone when an employee makes a successful recommendation. This may encourage others to follow suit. There is no one-size-fits-all solution. However, your program’s outcomes will increase if you use effective marketing.
Step 4: Keep the Program Going.
You’ve established and launched your employee referral program. The first month has been full of victories. However, as the initial excitement wears off, many initiatives tend to fall flat. Therefore, it’s critical to launch and maintain your program throughout time. This is accomplished by introducing new incentives and rewarding successful workers who recommend others.
- Increase the number of incentives available
Adding fresh incentives and bonuses to your employee referral program is a fantastic approach to prevent complacency. If you detect a decrease in referrals, provide a new reward. “For July, referral cash incentives are quadrupled!” These may be planned at the start of each month as well. Another suggestion is to have a company-wide celebration whenever several successful referrals have been reached. Awards for “referral employee of the month” should be given out. Employees will remain interested and helpful if your program is kept new.
- Employees Who Have Achieved Success Should Be Recognized
Employees like being thanked. Congratulate someone publicly when they successfully suggest an employee. Have the CEO acknowledge them at the following important meeting. Send an email to the whole business. Show gratitude for your workers’ assistance, and they’ll be more inclined to continue providing recommendations.
Step 5: Assess and Revise.
The evaluation and updating of an employee referral program is the last phase. First, you must assess the effectiveness of your program. You may then decide if it’s producing the desired outcomes or whether it’s time to make some adjustments.
- Measure
Specific measures might assist you in assessing the success of your program. First, calculate the ratio of referrals to hires to determine the quality of applicants referred by your workers. The participation rate indicates how enthusiastic workers are about the initiative. Compared to other recruiting approaches, the employee recommendation rate demonstrates how successful the program is. It’s also crucial to figure out how much time and money it will need to administer the program every month.
- Make any necessary changes.
If the program isn’t getting you closer to the objectives you set in Step 1, you’ll need to tweak it. For example, a poor recommendation to hire ratio indicates that you need to improve communication with your staff about the perfect prospect. If your participation rate is poor, you’ll need to ramp up your marketing efforts. If your program is taking too long, you may need to hire more people or use a software tool. If a program is too costly, the incentives granted may need to be reduced. It’s your responsibility to make the appropriate modifications if anything isn’t functioning.
Related Tags
- sample employee referral program
- how to promote an employee referral program
- Google employee referral program
- employee referral program pdf
- employee referral program email