Minimize the risk of hiring new employees
Recruitment are for Company always associated with risks: Does the new person fit into the team? Will he do his job well? And is he worth the tedious, cost-intensive application process?
By contrast, when employees recommend colleagues, they specifically contact those who are actually suitable - with much less wastage than, for example, job advertisements. In addition, referrers themselves are the best ambassadors for the employer brand that applicants trust. The risk of disappointment is thus minimized on both sides.
Examples of employee referral programs
The Internet company Travelbird from Amsterdam, for example, pays a bonus in the course of a staff referral program, when someone is recommended for hard-to-fill positions such as in IT, who gets the job - and proves himself.
The Berlin-based entrepreneur Peter Chaljawski and his Chal-Tec GmbH have been targeting employee recommendations since the initial phase in order to reduce costs and effort - and above all has had positive experiences: "Our employees usually have good contacts in the e-commerce scene and are happy that they can help shape their work environment. They are rarely friends but more often former work colleagues, business associates or referrals to them. The advantage is that you know their way of working and strengths - weaknesses profile. This helps especially in key positions. "
If the new colleague survives the probationary period, the referrers receive a bonus, the amount of which depends on the difficulty level of the newly occupied position. Chaljawski does not see the danger of forming a group or that employees can be held accountable for bad recommendations: The employee establishes the contact and the lead, in the end it is up to HR and management to assess the candidate in the context of a normal application process. Therefore, the recruiting department remains important, especially in fast-growing companies. "
Not just for StartUps
However, those who now think such referral programs are only a cost-effective recruiting tool for startups are mistaken: traditional companies such as Hamburger Volksbank have been counting on employee recommendations for years: The bank calls on its employees to actively engage with the slogan "Everyone knows each other" make potential colleagues.
If this becomes a contract of employment, the advertisers are allowed to drive the company-owned MINI convertible for two months free of charge. This fun factor and prestige increase the bond with the employer - and thus also its advertising effect. And HR Manager Wolfram Kaiser has the experience that the recommended employees are particularly team spirit and loyal: "Among the new hires who left the company, was only one person from the recommendation program," said Kaiser.
Employee recommendations are trendy
No wonder that employee recommendations are on trend. A recent series of studies by the Center for Human Resources Information Systems of the University of Bamberg in collaboration with the career portal Monster:
Already, a quarter of the top German 1.000 companies have implemented employee referral programs and 8,2 percent of the actual attitudes come about. However, the differences are large depending on the sector: SMEs account for only 18,8 percent, while the IT sector uses more than half of these companies.
Employees are afraid of recommendations
However, there are also reservations: four out of ten employees are afraid to recommend candidates, as their possible poor performance could fall back on them. More than half of the employees even feel responsible for the performance of the colleagues they recommend. And two out of ten employees do not recommend anyone from their circle of acquaintances because they do not want to work with friends or acquaintances in a company.
You can also see the bonus incentives being raised, as the management thinker Anne Schüller explains: "The true secret of success of the referral is based on voluntariness. If the referrer learns that money has flowed, it may suffer credibility and trust. One develops reservations and does not follow the not entirely selfless advice in the end then rather not. The biggest benefits of recommending are thus gone. "
Checklist for employers
Companies that want to use employee referrals should take a close look:
- Is the premium for the recommendation a meaningful incentive?
- Does it lead to an increased commitment of employees and thus to an additional advertising effect in the network?
- And how do the recommendations ultimately affect the recruitment success? For example, how high is the graduation rate, but also the turnover rate?
- In which departments are recommendations particularly successful?
- And what costs are incurred compared to conventional recruiting?
Only with reliable key figures can one ultimately decide to what extent employee recommendations can complement or even replace traditional HR work.
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