An employee referral program is a great way to find the best people for your company. When planned and executed well, it can also be the most cost-effective way to yield a high ROI in all your HR functions.

Researches by and CareerXroads found that referrals continue to be the leading source of employee hires in terms of volume and quality.

Meanwhile, Jobvite index discovered that in 2012, 6.9% of applicants were referrals and 46% of them were employed by top performing firms. Referred hires also produce 25% more profit and are 20% less likely to quit.

The error comes in when recruiters think it’s easy to design and maintain an employee referral program. Problems arise, and in the end, companies fail to reach the full potential of the program. Here are some reasons employee referral programs fail.


Long turnaround time or no feedback

When you take such a long time to respond to a referral, it makes your employee and potential applicant think that you are not serious about hiring the best candidate. Not only is that a negative impact on your brand, but you also miss the opportunity to employ a qualified person.

It’s even worse when you miss out on providing feedback to both the referrer and the referred. Dr. John Sullivan, a notable speaker on the topic of talent management, suggested that if both sides don’t hear something to their submission within 48 – 72 hours, they will probably become discouraged or even stop referring.

Make sure to mark referral resumes and immediately notify them about the referral within five days. In your response, be honest as to why the referral worked or did not work.


No referral rewards or bonus

There is no better brand ambassador for your company than your current employees, and this is evident in the effectiveness of your referral program.

Referrals is an affirmation of your employee’s corporate citizenship and belief in your value promise. When they are able to convince job seekers to apply, it also means that they are confident that the company can offer applicants the same level of compensation, stability, and

To acknowledge this effort, and to encourage them to maintain their involvement with the referral program, offer them incentives like gift cards, cash, or a day-off. You can even tier the reward with each step in the process, like giving a prize if an applicant lands an interview, and another one if it results in an actual hire.

However, there are also some no-no’s when it comes to referral bonuses, like withholding rewards. Prizes will only work if it is given immediately and there is no risk of not getting it; plus, it discourages participation.


No mobile capabilities

Mobile capability streamlines the way you live and share information, and that includes implementing an employee referral program. Integrating mobile strategies will allow you to reach out to referrals through more than just one channel.

If your company’s career site is made mobile-friendly, it will be a lot easier for referrals to reach out to you. However, your effort should continue on even after building a mobile app and having responsive website user interface.

Leverage SMS or text messaging. It’s one of the most basic functions of a mobile phone—which everyone practically owns—so there’s less risk of applicants not receiving or replying to your messages.

With 98 percent of text messages read within just three minutes, your potential applicant’s response time is faster through SMS.


Resisting automation

With hundreds of resumés (and other recruitment tasks) at your disposal, it’s easy to lose your focus on the referrals. Make your life painless by taking advantage of an automated recruiting system—from informing the company about the referral program to interviewing the potential employee. Automating also helps you and your network keep track of referrals.

As mentioned, referral programs can help your company boost employee engagement in an appealing way for your workers, but it can be made more effortless when done with the proper tools.

It’s important to realize that there are factors that will make your employee referral program successful. However, it is more important to know that there are also details that may seem innocent at first, and still ultimately, will negatively affect your program. Remember to plan and execute your strategies properly to avoid pitfalls.

Utilize mobility and let Refer find you the best employee referrals for your company. By harnessing the capabilities of SMS and web-based messaging apps, it can help your employees spread the word and find your recruits with a push of a button.