Growing Your Referral Network - The Path To Great Hires
By Randy Quarin
Companies spend countless hours (and dollars) posting on job boards, wading through resumes, or hiring recruiters to obtain the top talent in their industry. At the same time, most companies fail to fully utilize one of the best sources of top candidates – referrals.
Referrals are consistently mentioned by Hiring Managers as one of the most effective ways of finding top quality candidates, yet most companies fail to use this tactic to its full potential. We’ll show you how to take advantage, and tell you about getting referrals from people you’ve never met.
Plentiful Upsides
There are a number of reasons why referrals can be one of the most effective tools for sourcing candidates:
First, nobody understands your company as well as your employees, suppliers, family, friends, colleagues, etc. Their connection to your company allows them to act as an ambassador because they have insight into things like your culture, expectations, and values. Whether someone works there, deals with your company on a regular basis or learns about it from you or another employee, they’re better able to gauge the fit of potential candidates.
Second, referrals are extremely cost-effective. There are virtually zero initial costs and any monetary reward handed out is only required once a referred candidate has been hired. Online job boards and newspaper ads require up-front fees with no guarantee that they will lead to a successful hire. Competent recruiters will find you a successful hire but their fees are usually higher than any amount paid out through a referral program.
Finally, when someone refers another person, they’re vouching for that person and putting their name on the line. Because a referral’s performance and behaviour will reflect back on them, people are much more inclined to show discrimination in those they refer. Essentially your referral network will perform a very preliminary pre-screening for you before any candidates actually get passed along to you.
Six Degrees of Networking
A referral network is not necessarily only made up of people you know. A truly strong referral network is made of people who know people who know you. And so on. There is a popular game called “Six Degrees of Separation” the premise of which is that there are six or less degrees of separation between any two people in the world. While this is a bit of a stretch, it is fair to say that with some diligence you can connect to talent in any industry, in any role, through referrals.
To do this however, you need to be conscientious in maintaining not only your close relationships – which tend to be formed through association in like industries and like roles – but also nurturing your more casual relationships. Whenever you are introduced to someone new, inquire about their work and learn about what they do. Ask for a business card, and the next day send an email saying ‘nice to meet you.’ Voilà, you now have a contact in a new industry.
People that you maintain more casual relationships with are in a better position to connect you to new people purely because the nature of the relationship means that less things are shared or known about each other….including people and contacts.
Quantity over Quality
Because we know that casual acquaintances can represent some of the greatest sources of candidates, it’s ok and even recommended to take a ‘quantity over quality’ approach to networking for the purpose of referrals. This isn’t to say we should be seeking referrals from anyone and everyone, just that it’s not necessary to develop deep personal relations with people to gain referrals the same way you would if you were going to do business together.
With this in mind, building a great candidate referral network is something that still takes time to grow and develop. The more you can do to build your referral network before your hiring needs arise, the more effective it will be when you need it. For that reason, it’s important to constantly be planting seeds and identifying potential new sources of candidates.
Share Your Dream
A good habit is to share your passion about your company regularly with everyone you meet - let them know why you do what you do and how great it is to work at your company. Sharing information about your company vision helps to build your employment brand and will attract people that are passionate about the same things you are passionate about. A team with a shared vision is more motivated, more productive and more loyal. Real talent works towards goals. Employees work only for money.
Because we’re looking to build a network of connectors, and people of all walks of life cross paths, almost every person you meet is a possible source of great candidates for your company. You’ll probably find that there are many people you never would have thought could be a great source of referrals. Get creative. Other people in your company's building that you know casually are a perfect example. They know who your company is, and probably know a bit about your culture and values as well.
By constantly sharing information about your company vision, you are signing up recruits to share that vision with others. This in turn will allow your referral network to help their contacts (with a similar vision) to find the job of their dreams. It works for you and it works for them.
The Universal Motivator - $$$
While most people are naturally friendly and helpful in nature, nothing provides incentive like the opportunity to earn a little extra money. While people may still refer candidates to you even without the opportunity for any personal reward, the likelihood of people working on your behalf increases exponentially if it’s there.
Cash incentives are common in employee referral programs in the event that an employee refers a successful applicant. If you offer a cash incentive to employees however, why should you not extend that same incentive to the rest of your network? If the end goal is to get great candidates referred to you directly, then it only makes sense to extend any incentives out to your entire network, not just employees. Many companies are happy to pay sizeable fees to recruiters to find them top talent, yet when it comes to compensating those who provide referrals, they get stingy. By being generous with referral rewards and including your entire network, you’ll find people will stay much more aware and keep your hiring needs top-of-mind.
Here are a few tips to help grow your referral network and get it working for you:
- Constantly think of new sources of potential referrals – identify any people who might be in a position to help
- Include as many people in your referral network as you can – more people = access to more candidates
- Make special note of reaching out to your casual contacts for referrals as they can often generate the best leads
- Extend your offer of rewards and incentives to anyone capable of generating great candidate leads for you – don’t limit it to certain people or strictly employeess
- Notify your network when you’re looking, let them know the specifics, and reinforce what’s in it for them (The reward!)
In the end, referrals represent a winning formula for both you and the referring person when you hire through this method. Your company gets candidates at a greatly reduced cost, both in terms of time and money, and the referring person gets compensated for putting forth some effort on your behalf. The great thing is it’s something that is so easy to do – try it and see what effect it has on your hiring efforts.
- Randy Quarin, Senior Partner, has an intuitive sense of how to solve a client's business issues with the best resources.
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