Should you consider an employee referral program?

There are many strategies when it comes to hiring talent that will help move your company forward. One of the most consistently successful strategies, leading to employing the best-quality people, is an employee referral program. Hiring employees based on a current employee's recommendation is an excellent way to find talent. Your employees want to work with other people they respect and who can help them, and the company, do great work. As people who work at the company day-in and day-out, current employees are likely to know the requirements of the open position and how it fits within the rest of the company. Most of the time, a current employee will recommend individuals who have not only the skillset to do a great job, but will fit in well with other employees and exhibit the values and mission of the company.

When you decide to create an employee referral program, or ERP, you should also make sure your employees want to use the program. Your time and investment in setting up an ERP is only effective if it actually attracts quality employee referrals. Here are the top 5 things to keep in mind when creating your employee referral program.

1. Distribute benefits immediately

According to the Wall Street Journal, it now takes an employer an average of 25 working days to fill a vacancy. That's over a month of work! If you make a referral bonus contingent on an employee being hired and working a certain amount of time, such as three or six months, there's no instant gratification for your employees. While they will appreciate seeing the extra money in their paycheck if that's the award you decide you use in your ERP, it's hard for the brain to link the cause to the effect. Instead, award the benefit on the new employee's hire date. There should be no need to institute a waiting period to see if the employee works out. The right screening and hiring process should guard against most employee attrition in the first six months and all but eliminate the need for a probationary period.

2. Engage social media

Many employees who are well-poised to recommend great people have professional networks that span the globe. These days, people also do lots of networking online, especially through Facebook, LinkedIn, and professional organizations and networking groups. Make it easy for your employees to use social media to invite members of their network to apply while automatically making it clear who is referring them.

3. Prioritize employee referrals

Your ERP won't be as successful as it could be if you add employee referrals to the same queue as all other employee applications. If one of your goals in an employee referral program is to recruit more highly qualified individuals who are a great fit for your company culture, you will want to act on those applications right away. Think of an employee referral as giving a step up to that potential candidate.

4. Hold networking events

A breakfast, lunch, or information session where employees are encouraged to bring their prospective referrals can help increase employee participation and allow your recruiting or HR team to meet with candidates and make informal connections before reaching out to schedule interviews. A tangible benefit like catered food, networking, and social engagement can be a fun way to get employees involved, and the event’s presence will help remind other employees of the opportunities that exist when you refer a candidate.

5. Reward outside referrals

Expand your ERP to include non-employees. If you offer a cash bonus, which is one of the most common benefits in employee referral programs, determine if your accounting system can be set up to make outside payments in the same amount. Retirees, former employees, employee spouses, vendors and clients may all have insights into your business and know people who would be a great fit. Let these people know you will pay for the right referral and expand your pool of potential candidates.

With quality employee referrals, it's highly likely you can reduce your recruitment costs and increase employee retention. Employee referrals require no outside advertising, and perhaps less original vetting than cold resume submissions. Aside from feeling appreciated and helpful when they refer someone who ultimately gets hired, your employees will enjoy working with people they know, like, and with whom they can effectively collaborate. Building on social and professional bonds outside your company makes your company stronger, which also creates more productivity and employee satisfaction.

How Building the Right Company Culture Can Build the Best Team

Companies with legendary corporate cultures are well-known for attracting the best employees. Everyone knows why they'd love to work at Google's hub in Silicon Valley: the free food and drinks provided at several dozen on-site cafes and coffee bars, the free wi-fi enabled shuttle that transports San Francisco-dwellers to Silicon Valley, and plenty of paid leave for new parents.

How can you take advantage of a similar system if you don't have the size or prestige of Google or Facebook? Surprisingly, you don't need a ton of expensive perks to create a positive company culture. You just need to find the right employees.

Here are 6 tips that will help you create a positive company culture and attract the right job candidates.

1. Define company culture.

Many companies don't think about culture much at all and allow it to simply form organically. While that might work for small start-ups and hyper-local businesses, your company is growing, and you will want to define a specific list of your company values, attitudes, behaviors, visions, and practices. When defining culture, each company will differ. You do not have to offer a pingpong table, weekly happy hours, a casual dress environment, or a bring-your-dog-to-work day. Each of those things contribute to a specific company culture, but it doesn't have to be your culture. What do you want to see and do when you go into work everyday? What commonalities do each of your current employees share? These questions will help you realize what you have to work with and what you want to keep and change when you define and develop your culture.

2. Focus on retention.

You know keeping employees at your organization is good for your company. You need to convey how longevity is good for employees. Many of today's top job candidates are used to moving between organizations every two to three years to gain leverage when increasing pay or responsibilities, or due to issues with their current company or team. Stability, as long as growth and challenges are included, can be appealing. Having a strong, positive company culture will help keep your employees at your organization, rather than allowing other companies to attract them once their skill sets are built. Sadly, only 13% of employees globally say they're actively invested in their company's success. Figure out how to get your employees to care about their company. You’re (hopefully) investing in the continuing training and education of your employees, so your organization should want to benefit from their skills. Long-term employees who are at the company because they care and are excited about their work can also influence other employees to give it their all. A company where many employees stay for five, ten, fifteen years or more also gives the impression of being a place that delivers on its promises. It's likely a place that challenges and interests current employees, making it more appealing for job seekers. Candidates want to know that they can build their career with your company, and current employees like the assurance that they can develop long-lasting work relationships.

3. Promote from within.

Promoting your own employees to higher positions within your company can benefit both your bottom line and your company culture. First, it helps with retention, as employees will feel assured they can continue their career paths with you, rather than having to leave the company to find a position with more responsibility or pay. Second, you will benefit from the expertise of an employee you have nourished and mentored towards the goal of rising through the ranks, and someone who doesn't have to be brought up to speed about the company's values, goals, plans, message or industry. Having a strong company culture also means you’ll know when not to promote from within, and will be able to identify the holes you need to fill with outside talent, who can bring a fresh perspective to your organization.

4. Offer tangible benefits.

Perks like assigned parking spots can be great if they are necessary or if people use them. Benefits that add a lot of value to a job package can help your company stand out from the rest. Paying for continuing training, like technical certifications, conferences, and degree programs, can benefit both the employee and your company, when you take advantage of the employee's new-found skills. Consider benefits that are applicable to your company, too. If you are located in Center City Philadelphia, a transit benefit can have an immediate, positive impact on your employees by saving them money on either their current SEPTA pass or gas and parking costs, if they chose to switch over to regional rail or subway. If you're a company with a small budget, you don't have to think big. A stocked coffee bar or catered lunch twice a month can also save employees money, as well as provide goodwill and promote a sense of caring for the employees by the company. Tangible benefits will depend on your company's values and the type of job-seeker you are trying to attract.

5. Cultivate Mentorship.

Good management is the backbone of your organization. You want to hire and promote managers who have great managerial skills, not just those who are good at their particular job. An employee who is managing people, be it one person or twenty, should be knowledgeable about their field and department, but also skilled at leadership. A good manager is one an employee relies on to help guide them through at least one part of their career. You want employees to feel comfortable talking to their manager about their projects, workload, conflicts, and goals. An employee should not be afraid to admit to mistakes or failure with their manager, but should be assured their manager will help find a solution, and perhaps use the employee’s skills in a better way. A good manager can mentor an employee into becoming a better employee, a happier worker, and perhaps a manager themselves.

6. Be consistent.

Obviously, all company culture benefits should apply to all employees. While some job candidates or employees may find that your employee culture isn't the right fit for them, it should not be because they are not afforded the same benefits and perks as other employees at the same company. If you decide to stop offering a benefit, for example, you should cancel the benefit across the board. Do not allow employees to be grandfathered into one aspect. Also, don't allow the rules, like dress code, to only apply to certain people or let certain aspects of culture slip with long-term or favorite employees. This can create a sense of animosity and unfairness, which would contribute negatively to the environment you're trying to cultivate.



It may seem counter-intuitive, but company culture is cyclical. Defining your company culture and hiring employees that fit well with those values and attitudes will make your business a great place to work. This, in turn, will lead to exceptional candidates applying for jobs with your organization, and eventually contributing even more excellence to the company and attracting even more candidates. Building and maintaining a company culture may be one of the most important things you, as a business owner or executive, can do to build your company.

10 Employee Retention Strategies to Improve Your Company's Performance

Five years into the U.S. Economic Recovery, talented employees once again hold the cards when it comes to choosing where to work. With employee bounce rates reaching their highest levels since 2008, companies are in a vulnerable position that may leave them understaffed and falling short of their goals.

Why is Employee Retention so Important?

The reduced pool of qualified talent combined with increased employee acquisition and turnover costs have an exceptional adverse impact on your bottom line. The loss of large numbers of talented employees will have a long-lasting negative effect on your profits and the cumulative performance of your employees.

Employee retention is better for everyone - employers and employees - because high retention rates equate to shared goals, improved performance, and competitive advantage. So why do top employees quit? The two most common factors are lack of job satisfaction and more appealing career options.

How to Insure Your Talent Acquisition Investment

The days of retaining employees by dangling a cookie filled with a good salary, paid time off, medical benefits and a 401k are over. Don't get me wrong - talented employees expect all of the above - but they want MORE. In order to retain your talent, commit to an employee retention program - TODAY.

10 Tactics You Need to Include in Your Employee Retention Strategy

What matters more than than money to the knowledge workforce?

1. Recognition: A pat on the back goes a long way. Give praise for a job well done. How about an improved job title? Appreciation is a fantastic and free employee motivational tool.
   
2. Break the Sandbox: Encourage employees to use their imagination and move outside of the box.
3. Keep Things Spicy: Forget the humdrum - push your employees to reach their full potential with a challenging variety of tasks. Variety is indeed the spice that turns a bored employee into an engaged employee. 
4. Be Transparent: Keep job descriptions accurate and up-to-date so employees have a clear understanding of what is expected in their current role and have direction on areas to build skills as they aspire to transition into other roles.
5. The Magnetism of Employee Empowerment: Let your employees plan, perform, and evaluate their own tasks to lock them in for the long haul. 
   
6. Do Some Yoga: When it comes to paid time off, be flexible to improve employee work-life balance. Your employees will be loyal for it.
7. There's No "I" in Team: A teamwork culture increases employee productivity and retention.
8. Communicate: Set realistic performance standards and 360-degree performance reviews.
9. Lifelong Learning: Employees stay motivated when they have the opportunity to keep learning. Employee development initiatives can include formal company training, certification incentives, and tuition reimbursement. A learning organization will be more agile during imminent times of change.
10. Perks: From employee stock options, quarterly performance bonuses, and health club reimbursements to happy house and free lunch - employees appreciate fringe benefits.

Hierarchy Matters

When designing your employee retention program, keep in mind what motivates employees will typically vary dependent upon their position within your organization.

Top, Middle, Bottom

• High-level employees are motivated by praise and development opportunities.
• Mid-level employees are motivated by opportunities to learn and like open door policies with their direct managers.
• Low-level managers are motivated by competitive salaries and perks.
• Entry-level employees are motivated by bonuses, performance-based raises, and pay for working additional hours.

In order to retain talent, employees must feel like their goals are in line with the company that they commit to. A comprehensive employee retention program will give your company the highest ROI because motivated, engaged, and loyal employees are more likely to reach their fullest potential which will naturally increase your organization's success. Check out Philly.com's top workplace list for more employee retention inspiration.

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