Opinion Piece - 4 reasons why fast-growing companies need employee referral programs
The need for good talent is paramount for any startup and becomes even more significant when the startup is on a high growth trajectory. Nasser Oudjidane, Co-Founder and CEO of intrro is no stranger to this situation, and shared his insights with MAGNiTT on how startups can avoid this pitfall:
Fast-growing startups face a number of challenges like customer acquisition, lack of structure and tight cash flows. However, one area can influence your company’s success more than anything else, the people you hire.
Hiring the best talent is no easy task as competition is becoming fierce with eye watering salaries and equity packages. Here are 4 reasons why an employee referral program can supercharge your recruitment strategy.
1. Employees boost response rates
Turning your employees into advocates is the single most effective recruitment tool for a fast-growing company.
Candidates have become desensitised to job boards, cold messages and adverts. Employee advocates add a unique personal element in the increasingly noisy world of outreach. In fact, candidates are 46% more likely to respond when they are approached by someone they know.
2. It’s about more than money
Unlike recruiters and agencies, employees do not depend on referral fees as their main source of income. Employees tend to make referrals based on the belief that the person is an exceptional fit for the role.
This is crucial, as recruiters will only be able to find the best available candidate.
Chemistry is crucial when hiring for a fast-growing company. Employees need to get along in what can be fast paced dynamic environment.
A recommendation from an employee who knows your company culture as well as knowing the candidate on a personal level is much more likely to result in a successful hire. This goes far beyond recruitment calls or interviews and gives the company a much better understanding of the potential hire.
4. Say fewer goodbyes
One of the main growing pains in a fast-paced company is hiring the wrong people. Research shows that after two years, retention of referred employees is 45% compared to only 20% from job boards.
Increased retention rates allow the company to focus on growth, rather than being bogged down with replacements for existing roles.
To learn more about best practices for employee referrals, feel free to connect with Nasser on MAGNiTT below.