John Sumser, Principal Analyst, HRxAnalysts
Referrals, like any Recruiting methodology have their place. They can be a short-cut to the perfect employee. They can also cause culture-rot if managed without care. Tapping into the collections of friends your employees know on social media is no panacea
All referrals are not equal. Referral programs range in design from high volume candidate flow drivers to the sort of referral you might make about a bottle of wine or a good restaurant. While the implementation approaches range widely in effectiveness, the idea that all referral programs yield predictable and repeatable results persists.
At its core, an individual referral involves some key elements:
An employee who
➡ has the best interests of the organization at heart
➡ knows the sorts of people who can help the company meet its goals
➡ is willing to stake her professional reputation on a recommendation
➡ believes that her recommendation will help her friend get the job
➡ can adequately distinguish between her interests, her friends interests and the company’s
➡ is able to understand a friend’s strengths and weaknesses from the company’s perspective
➡ is willing to live with the cognitive dissonance associated with integrating her social and work personas
An employer (really, a hiring manager) who
➡ values the employee’s recommendations
➡ believes that the workforce will be better if there are ‘more like her’
➡ is willing to give an advantage to someone the employee recommends
➡ is comfortable blurring the lines between work and social life
➡ wants accountability for acting on referrals to be a part of the employment relationship
➡ is willing to risk the morale damage when it doesn’t work out
➡ is willing to accept an employee’s personnel judgments as a starting point
➡ is willing to be vigilant on the discrimination front
All referral programs are more or less like lottery drawings.
The most effective versions of the game are played in close quarters (I recommend you to my friend in HR and you get the job). Like any process where real dirt gets under actual fingernails, there is an astonishing intimacy that ties the recommendation to performance.
When executives say that referrals are the best source of new employees, they are talking about close, personal, referrals where all players risk their reputation on the outcome. While there is some chance that your friend won’t get the job, the whole idea is that your recommendation improves the likelihood that she’ll be coming to work for the company.
Still, there’s always the chance that it won’t work out.
At the other end of the spectrum are mass efforts to increase the number of names that go into the top of the funnel. Each and every employee, regardless of performance or attitude, is asked to contribute friends and connections to the company’s talent pool (perhaps, talent cesspool is closer). There is little intimacy and even less chance that one’s recommendation is meaningful.
All of the names collected in this sort of a program go into the same queue as the other people applying for jobs. It’s just like buying your friend a lottery ticket and every bit as likely to pay off.
This new form of referral, divorced from all of its social intimacy, is what many social media Recruiting tools are peddling. Since Andresson-Horrowitz (the Social Media centric Silicon Valley Venture Capital Group) funded Top Prospect, there has been a rush of lemmings racing towards a sea of social media generated referrals. It’s not even as effective as getting names from the phone book.
At any rate, the kinds of referral programs that work are the ones where the players risk their reputation or career on whether the referral works out. But, since we no longer know what a friend is, it’s no surprise that we’ve forgotten what a referral is.
Interesting viewpoint, John — I enjoyed reading your article. What you’re describing, however, sounds like a “second order” problem — companies and recruiting agencies who establish a wide-reaching referral program may see a dilution in the quality of the referrals they’re receiving. However, many companies and recruiting agencies have the *first order* problem: they don’t have a strong referral program at all! You suggest that referral programs are at best lotteries with poor results. While the quality of each referral may be unpredictable, what’s predictable is that they’re going to be higher quality than the alternatives: broadcasting the opening to the masses and ducking as a torrent of unqualified inquiries pour in through job boards, emails, and job portals from jobseekers desperate for any job, regardless of fit.
You’re absolutely right that down the road, the administrators of a referral program must take steps to discourage junk referrals… but until people have that problem, the typical referred candidate is more likely to be a better fit and more likely to accept an offer than candidates received from other sources. Recruiting teams would be doing themselves a disservice if they shied away from establishing a referral program simply because they feared individual referrals might not represent the same level of reputation risk that they have in the past.
John,
First of all, I enjoyed your post, and think you make a lot of good points. That said, I’m not certain I agree with your conclusions.
As you mentioned, all referrals aren’t created equal, which is certainly true. And, I definitely agree with your assessment of which referrals make for the “best” type of referral. But, I don’t think accepting either of those points necessarily implies that referrals that don’t fall within the subset of deep, personal relationships (you seem to imply this when you say hiring managers must be “comfortable blurring the lines between work and social life”) cannot provide significant value to organizations’ talent acquisition efforts. Or, in other words, you seem to suggest that “loose” (or even comparatively looser than what you’re suggesting) social connections should not be recommended as potential candidates. I humbly disagree.
Consider the case of finding candidates with highly specialized skill sets. Chances are that a good IT consultant in a highly specialized field, for example, will know other good IT consultants with similar specialties. Generally speaking, employees’ LinkedIn connections tend to consist in past colleagues, former schoolmates and industry peers. Even if there isn’t a “strong” connection to these people, is it right to say that one cannot, in good conscience, recommend that anyone from among these types of connections might be a good fit for opportunities at her respective workplace? Or, that hiring managers and/or talent acquisition organizations shouldn’t value these recommendations at all?
My worry is that your view is too extreme: that is, you seem to suggest that organizations should require ideal results or do nothing at all. Instead, I suggest a more nuanced view, comparing something to what, in most cases, is nothing. More specifically, many referral programs fail to harness the latent value of their employees’ social networks. So, we’re agreed that intimate relations are the best source of referrals, but not on the value of comparatively “looser” connections, especially when you make an even more extreme claim that these recommendations are “not even as effective as getting names from the phone book.”
Yes, allowing these types of recommendations allows for a wider variance of quality (which stems from employees’ varying quality of work and judgment, as you point out). That said, certain platforms, like Bullhorn Reach [full disclosure: I work for Bullhorn], enable and encourage employees to provide more context surrounding their recommendations (information that’s then forwarded to their recruitment organizations). This doesn’t solve for the variance in quality, but it does provide more transparency and context around the issue than merely putting “all of the names…into the same queue as the other people applying” or “buying your friend a lottery ticket.”
Separately, I think you also overlook the value of leveraging employees ability to share jobs to their social networks, even if only posting it to their profiles or a handful of industry- or skill-specific LinkedIn groups or Facebook pages. Compared to recruiters posting jobs , an employee’s sharing an open opportunity is more likely to capture the interest of passive candidates (say, an industry peer) who are gainfully and happily employed than a recruiter’s post would.
The underlying theme of what I’m saying is that I think you that the picture you paint is too bi-polar: referrals are either really great or not of any value at all. I don’t think that’s the case. When compared to being presented with names from the phone book (or some person whom none of your employees has any knowledge of), I think a somewhat “looser” connection (than the most intimate relationships where everyone is willing to put their reputation at stake) is probably preferable — at least as an initial source of potential candidates.
Steven Duque,
Bullhorn Reach