According to a recent study, 88 percent of employers rank employee referrals as their most valuable sourcing strategy - and for good reasons. Studies show that a well-developed employee referral program has the power to reduce hiring costs, improve time-to-hire, and decrease turnover, all while also increasing the quality-of-hire.
Developing an effective employee referral program for global recruitment, however, can be extremely difficult, yet if not implemented correctly it will lose its effectiveness. Some companies, like Dell, have taken steps to make employee referrals a priority and have realized great results. Here’s how they did it.
Dell acknowledged that its current employee referral program had plenty of problems. Not only had they received complaints from both employees and management, but referral hiring success had been sporadic from location to location. This comprehensive review shed light on several major problems within Dell’s referral program that hindered its success.
- Lack of Consistency - Managers developed different interpretations of the employee referral process, which led to eligibility problems, varying payout amounts and timeframes, frequent exceptions, and other issues.
- Poor Promotion - Dell’s promotion of the program was inconsistent. Many employees and even managers did not understand the program entirely.
- Inefficiencies and Errors - Dell was still using a manual process (spreadsheets) to manage their employee referral program. Not only was this incredibly time consuming, but it led to errors, incorrect records, and slow processing.
- Poor Management - The referral program lacked regional management and employees and managers had no point of contact to turn to with questions or frustrations.
- No Social Platform - Vacancies were not being shared over social media to make referrals easier.
Revamped Employee Referral Program
Dell revamped its employee referral program to help fix some of these problems. They focused on five primary areas.
- Set Policy - Dell worked with regional managers to create a comprehensive policy that meets the needs of each location. It set specific eligibility and payout policies.
- Consistent Process - The company developed a consistent referral process so that employees could understand the payout timeframe.
- Organizational Structure - In addition to a primary program manager, Dell designated regional managers who would serve as the point-of-contact for each district.
- Promotion Strategy - Dell created a steady and consistent promotional strategy that included tactics like email messages, newsletters, print materials, recognition, events, and competitions.
- Proper Tools and Training - The company invested in an efficient employee referral platform to allow for social sharing and proper tracking. It also provided adequate training to ensure that the policy was implemented and tracked correctly.
Dell achieved real results, including an increase in its referral rates, decrease in cost-per-hire, enhanced participation, and improved documentation. You can improve your hiring results by developing an effective employee referral program just like Dell did to scale your global recruitment.
Check out these EmployUs employee referral templates to help jumpstart your new program.