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Referrals Don't Work III
(October 24, 2006) Last week, after we finished the Referrals don't work piece, Scott Dow sent along a copy of the talking points he uses when introducing "The Empower Network" to prospective clients. We've been working with Scott and is team on a project called the Lean Staffing Institute. Over the next couple of weeks, we're going to be talking more about Scott and the idea of Lean Staffing.
Astonishingly, the subject of the talking points might well have been "Referrals Don't Work, Here's Why and Here's How to Fix It".
The paper notes that Employee Referral Programs get a lot of attention at this point in the economic cycle. As companies scramble to solve hiring problems on the cheap, they start to notice that their existing employees might make good supplements to the recruiting workforce. Referral bonuses get added (you never hear about cash compensation when the economy is flat or declining) to turbocharge the results.
Most often, according to the paper, you get a flood of low quality candidates that require white glove treatment. It's an interesting point. It seems pretty logical that candidates who come through referral programs are more expensive and delicate to handle. That should probably be a disclaimer on any recommendation for a referral program. "These candidates require special handling (because your employees made the recommendation and vouched for them, that's why).
Scott's team suggests that referrals don't work the way that they are usually approached. Instead, they suggest expanding the network well beyond referrals and seeking personal endorsements for the candidates (vouching that they are capable of doing the job).
The talking points go on to show the methods needed to install a working program and the way to use bonuses to turbocharge results. It's a good quick read. Download it.
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