At Accenture, Inc. based in Toronto, an employee was given a $6,000 bonus for referring a candidate for a senior-level job. The candidate was his long-time friend, and the employee felt that the real rewards were having his recommendation validated through the selection process and having a friend at work. According to the director of HR at Accenture, 24 percent of experienced hires come from staff referrals. At Ernst and Young LLP, employee referrals are used because they are more economical than a search firm, and employees understand the culture of the firm. Another advantage of employee referral programs is the increased engagement with the firm’s goals. At Mars Canada Inc., employees care about the business results and success of the organization, so they are cautious in their recommendations and act as a first screening. Companies are also cautious about keeping the referring employee in the loop and submitting all referred candidates to the same rigorous selection process. Employee referrals and social recruiting, which already began melding through Jobvite, and other tools are growing even closer as new vendors enter the field and corporations test how well their jobs spread on Facebook and other sites. Cisco, for example, has offered about $2,500 per job for people who fill selected openings by spreading the word through social media sites or email. Experienced nurses and occupational/speech/ physical therapists are among the highest in demand, so many hospitals are using employee referrals to generate leads. At one hospital, there was “unreal” interest when the 36,000-employee organization moved to an electronic employee referral system 2 months ago. About 1,500 people referred candidates in about a month. This was not a social media campaign per se, but that is likely coming soon. This smart marriage of referrals and social sites is where we are headed.

Questions

1. How does automating the employee referral process encourage referrals?

2. What do you think some of the drawbacks of getting referrals from social network sites might be?