Why Some Employee Referral Programs Fail?

Some employee referral programs fail to live up to their full potential. Why is that? Here are the 7 most common reasons why your employee referral program may not work well. You will also learn proven tips to fix common barriers and get the most out of your employee referral program!

How come some employee referral programs fail?

Employee referral programs work.

There is plenty of data showing that employee referral programs:

• They are the best source of hire
• They improve the cost, time and quality of hire
• They have the highest return on investment (ROI) of all recruitment methods.

However, some employee referral programs fail to live up to their potential.

If your company’s employee referral program is struggling or under-achieving, don’t worry – you are not the only one.

Many HR professionals come to me with a question:

Why is my employee referral program not performing well?
What am I doing wrong?
Tell me what to do to fix it!

There are a few common reasons why your employee referral program might not be working well.

Luckily, most of them can be fixed easily.
In this blog post, I will show exactly how to do it.
Let’s get down to work!

Reasons behind unsuccessful employee referral programs

Here are the top 7 reasons why some employee referral programs fail:

1. Referred candidates are left hanging

• Do you answer every single referred candidate?
• Is your answer timely?
• Is it personalized?

If your answer to any of these questions is no, beware: The lack of response from employers is No. 1 cause of a bad candidate experience !

➡️ How to fix it?

Send a timely, personalized answer to every single one of your referred candidates.
Luckily, this process doesn’t have to be exhausting and time-consuming!

You can automate it with the help of technology.
Modern recruitment software offer many benefits , including employee referral features!
Use them to automate, fasten and improve your communication with referred candidates.

2. Referring employees are left in the dark

• Can your referring employees check the real-time status of the candidate they referred, from anywhere, anytime?
• Are they regularly updated about any changes in the status of the candidate they referred?
• Do you provide feedback to your referring employees about the quality and fit of the candidates they referred?

If your answers to these questions are no, your employees are probably feeling left in the dark!
This might destroy their motivation and negatively impact your employer brand .

➡️ How to fix it?

Establish open and regular communication with all of your employees who take part in your employee referral program.
Keep them updated and informed.

It’s also very important to provide them with honest feedback on the quality and fit of the candidates they refer.
Help them to choose better candidates by offering training and practical advice on everything they need to know to recruit the right type of people for your company.

3. Ineffective employee referral awards

• Are your employees motivated with your employee referral awards?
• Are they excited by an opportunity to win these awards?
• Is receiving them a source of pride and joy?

If your answers are NO, your employee referral awards are probably ineffective.

➡️ How to fix it?

You don’t need to have a huge budget to ensure effective employee referral incentives.

Think about it for a moment – what is the reason for providing these awards?
They are given to motivate and thank employees for referring high-quality candidates.

There are many ways to motivate and thank your employees without breaking the bank.

Don’t be afraid to experiment with innovative employee referral bonus ideas until you find the one that works best for your employees – and your budget!

4. Complicated referral process

• Do your employees have to fill out long application forms in order to refer a candidate?
• Can they share your job opening on their personal social media profiles with just one click?
• Can they easily refer candidates from all platforms (desktop, mobile, etc.)?

Answers to these questions can indicate if your referral process it too complicated.

➡️ How to fix it?

Make it quick and easy for your employees to refer candidates!
Create a simple referral system where your employees never have to register or log in to make a referral.

Your referral system should also be available on the go from any device.
Your employees should be able to spread the word about job openings in just one click, whether via email or their social media networks.

5. Ineffective administration

• Is the administration of received applications time-consuming?
• Are you drowning in emails and spreadsheets?
• Can you track all referrals easily in one simple dashboard?

Answering these question will signalize if the failure of your employee referral process is an administration issue.

➡️ How to fix it?

Make your referral programs more organized, structured and productive.

Managing your employee referral program will become very simple and easy with the help of modern recruiting tools.
Most of these tools have features created specifically to help you centralize, streamline and automate your referral process.

These tools also automatically track employee referral metrics and offer real-time in-depth analytics and reports.

Check out our Checklist of features every modern recruiting software should have !

6. Lack of transparency

• Did you set clear rules to guide your employees through employee referral process?
• Are all of your employees familiar with these rules?
• Can they access these rules at any time, from anywhere in just one click?

If your answer to any of these questions is no, then your employee referral program is not transparent enough!

➡️ How to fix it?

The best way to ensure the transparency of your employee referral program is to set clear rules.

A good idea is to create an official employee referral program policy that will contain all the rules in one place.

By doing so, you will avoid potential misunderstandings and ensure that your program is perceived as transparent and fair.

7. Lack of continuous promotion

• Are your employees regularly informed about your new job openings?
• Do you publicly recognize the time and effort of your referring employees?
• Is your CEO preaching about the importance of your employee referral program on any given occasion?

If your answer to any of these questions is no, then you can significantly improve the promotion of your employee referral process!

➡️ How to fix it?

Create specialized marketing campaigns aimed at promoting your employee referral program.

There are numerous tactics to promote your employee referral internally.

Here are some ideas:

• Create a specialized monthly newsletter dedicated to your employee referral program
• Print out employee referral posters and put them on your office walls
• Have your CEO thank employees for their referrals in every all-hands meeting
• Organize referral parties – gather your employees, bring in a lunch or snack and talk about the benefits of employee referrals.

Recap: How to secure your employee referral program against failure?

Follow these 3 rules to secure your employee referral program against failure:

Rule #1: Communicate, communicate, communicate!

The key to a successful employee referral program is an effective communication.

Make sure you have open, respectful and timely communication between both with your employees and referred candidates.

Rule #2: Automate

Make the use of your employee referral program quick and easy both for your employees and your HR team!

Automate your employee referral process with modern recruiting tools such as out TalentLyft .

Rule #3: Make it rewarding

Besides being simple and quick, making referrals should also be awarding.

Offer great employee referral awards and don’t forget to recognize the time and effort of your referring employees!