When technology amplifies word of mouth, better hires are the result.
By Madeline Laurano
Despite the dramatic evolution of talent acquisition during the past few years, employee referral programs remain the most effective recruiting tool. In fact, studies from the Society for Human Resource Management (SHRM) reveal that more than 80 percent of organizations rank these programs as the number one source of high-quality hires. That’s not surprising, given the pressure being placed on recruiters to identify the right fit in an endless sea of job candidates.
Best-practice organizations are looking for more cost-effective solutions to help deal with both the tactical aspects and strategic aspects of recruitment. Employee referral programs empower organizations to achieve this goal.
Employee referral programs are a vital tool for attracting new talent while engaging existing talent within the organization. A strong employee referral program can directly impact the business by decreasing turnover, reducing costs, and improving productivity in the recruitment process. According to a study conducted by Jobvite, applicants hired through referrals are hired at a rate 10 times that of other candidates. Employee referral programs also improve retention by engaging existing employees in the hiring process.
Given the obvious benefits, employee referral programs are clearly a “must-have” for any talent acquisition department. Yet, the majority of these initiatives fail due to lack of employee participation, exclusion of senior management, and an inability to measure the results. In today’s global economy, organizations need a new approach. Employee referral programs need to reach a broader audience, including key stakeholders, personal contacts, and alumni. As a result, technology— social media—need to be a part of the equation.
Leading talent acquisition providers are offering more capabilities to help connect organizations to a broader workforce, empowering the individual, and creating a positive candidate experience. Below is a snapshot of a few of these providers:
This talent acquisition sourcing and applicant tracking provider sets the pace when it comes to innovation in the employee referral arena. It has successfully merged the areas of referrals with social networking for hundreds of customers including Tivo, Yelp, and Meetup. More recently, Jobvite has launched a social job app, where organizations can refer and apply for jobs privately within Facebook. The differentiator is that managers, recruiters, and candidates can manage the employee referral process for an extended audience without leaving Facebook, creating a positive user experience and greater engagement.
Applicant tracking software (ATS) solutions are becoming more mature in how they handle social media. Kenexa has demonstrated consistent innovation in this area, including the launch of social solutions in July 2011. Through their social career sites, job seekers have the ability to view all LinkedIn contacts for a specific company when applying for a job. For example, a job seeker applying to Google can view any of their first-degree contacts who work at Google. This capability and Kenexa’s deep domain expertise in employer branding services provide a powerful referral engine using LinkedIn and positive user experience. Customers such as Disney, Ford, and Pepsi are a testimony to Kenexa’s product leadership in this area.
Similar to Kenexa, PageUpPeople offers referral capabilities through integration with LinkedIn. The key differentiator is that the talent management provider extends this functionality as part of its career path solution. The career development tools empower existing employees and job seekers with functionality to see referrals on LinkedIn for a potential job, and also capabilities to help build and grow their careers.
Startups continue to emerge in the HR space this year. TalentBin is one provider that secured VC backing for its concept of a referral solution. TalentBin combines every employee’s contacts on Twitter, LinkedIn, and Facebook, as well as searching the open web for individuals on sites such as Meetup and Yelp that might be a strong fit for an organization. While still in its infancy, TalentBin is an up and comer worth watching in 2012.
Monster has completely revamped its solution set this year, becoming a powerful competitor in all things talent acquisition. BeKnown, a professional networking app on Facebook, has created a tremendous amount of attention. BeKnown enables employee referral programs by using the Monster-developed social referral program to share specific jobs, as well as determining whether BeKnown contacts are connected with companies or job opportunities.
Employee referral programs are the de facto method for attaining top talent in a slowing economy. Effective enterprise resource planning will bridge the gap between recruitment and retention. It provides companies with a cost-effective recruiting method that enlists and engages current employees. Leading solution providers are helping organizations by broadening the definition of employee referral programs to include a total workforce as well as empowering the individual.
Madeline Laurano is talent systems practice manager with Korn/Ferry International.