Sourcing School: Boost your employee referrals by combining automation with a proven methodology with Sam Davies

Ryan 0:36
Alright, so you want to kick this thing off?

Brian 0:39
Ladies and gentlemen, boys and girls, friends of all ages. That’s right, it’s time to do that thing called Sourcing School one more time with my partner in crime, Ryan Leary. It’s the Ryan and Brian show, as deemed by the Recruiting Animal. We are joined by Sam Davies today who is – Okay, so guys real quick to break it down for you. What I like about Sam, is it Sam found a problem, a challenge that we’ve all experienced in recruiting. But he didn’t approach it from that angle. He approached it from the candidate experience angle, we were just kind of talking about that. And that’s – the blessing and the curse of being an employee referral. I want to welcome Sam to the program. Sam, welcome to the show what’s going on?

Sam 1:23
Thanks a lot. Cheers. Great to be here. Great to be here. Really excited.

Brian 1:28
Yeah, so so about that excitement, I want to channel that excitement into a conversation we’re kind of having in the pre-show is that Sam was Sam was kind of telling us a little bit about his journey to help individuals navigate the throes of employee referrals. Because if you’re like me, and you may be like me, you may not be like me, but like the first thing I do when I’ve got a new hire that’s in front of me, I ask the question, Who else needs – in your network needs to work here, which can be a little bit of a painful process. It can be a little bit of teeth pulling. Sam, how are you solving the employee referral problem?

Sam 2:05
Yeah, great question. So I think that that’s it. Yeah, it’s a question that lots of people get asked, and lots of people struggle to answer. And before we go into sort of how our product does that one of the things is worth saying is when we kick off with a new, a new company, will often run focus groups for their employees to understand what goes wrong with referrals. And one of the key things that often come back is I get this, I get asked this question, Who do I know in my network, but I perceive a referral to be a recommendation? And then I’m okay. Well, if you think it’s a recommendation, who are you referring? So? Well, probably the, you know, around five people, five people that, that pop into my head? Well, those five people that tend to pop into your head, are people often a bit like you, which is obviously one of the issues around diversity, but –

Brian 3:00
Well, yeah, certainly, I’d agree. I wasn’t gonna I was gonna say that it is a gotcha question later, but we can. Yeah, so. So yeah, cuz diversity, diversity is important. inclusions important. equity is important in the organization, as well as allyship. And, you know, I was gonna ask you later, we’ll come back to that and keep riffing, man, I appreciate that.

Sam 3:23
But then – you know, so they’re, they’re looking at this really small group of people. And then then I’ll often you say, okay, so you’ve said five people, how many LinkedIn connections that you have, right, that are better? 1000s? We have a look at those connections. Sure. So we’ve just worked out that you’ve actually got about 30 connections who are a good fit. Why aren’t you referring them? Well, I don’t have time to go through my network and work out who’s a good fit for a job each time I get asked that question. So it’s always just going to be those sort of five people that we just talked about before. How are we tackling that? Well, when employees join our referral platform, we let them connect their networks with the platform. So your LinkedIn connections, your email connections, and then our system does the heavy lift for them. So it starts connecting, starts matching all of their connections to the live job vacancies that the company has, and basically lets them know when they’ve got a match. Not only does that help increase, the quantitative referrals, it also ensures quality because they’d be matched to the job, which can be a problem with referral schemes. But that diversity piece is also super important. What we’re doing is pushing it beyond recommendations to social introductions. And when you start pushing social introductions and wider networks, that’s when you tend to see a bit more diversity coming through from referrals, which has to be the way to go. If we’re to move away from I guess what, you know, whatnot, I guess what has been a historic problem with referrals, you know,

Ryan 4:47
So saying, Let me ask you this question. What do you say to someone that says employee referrals, put networks over skillsets?

Sam 4:57
I think that they have. I think that in the sense that you probably are putting forward your network of friends, a lot of the time people close to you. But this shifts the dial because, with the system, you start matching people to jobs based on skills. And you are encouraging people to refer people where there’s a skills match, not a relationship match. And when we move, move this away from a network of relationships, close relationships to a network of relevant skills, then I think we’re in the right ballpark.

Brian 5:34
Um, is that actionable? Because like, you know, when I think of employee referral programs, they’re supposed to be formal, but they’re not actionable, because most employees are not even aware of how to make a referral. Does this make it more actionable or, or just less of the same?

Sam 5:49
I think so firstly, it’s more actionable. If you consider one of the key problems are the key barriers to referrals as being this that time-consuming element people employees are busy, right, like they don’t have time to do much beyond their like day job. So the idea that they would have to go through their network workout who be a good fit, and then refer them that’s time-consuming. This is more actionable because we’re doing the work for them. But people aren’t going to come into a platform. And remember to do this each time. So we to make it actionable, you need to be telling them about this on their preferred communication channel. And that, that’s one of the key things that we look to work out in the focus groups that I mentioned before, it might be Slack, it might be teams, it might be email, but let’s get those notifications to them in their preferred format so that they can quickly action them. Is that enough? Does that make it actionable enough to make referrals work, it takes you a long way. But there are other aspects to it too. And other aspects of the platform, what a key part of that is, is the gamification, the rewards. I can go into that now. Or we can –

Brian 6:52
Actually, wait a minute, Sam, I gotta call you out here for a second, it was like you’re talking about automating these tasks, and enabling employees to share open jobs with their network via social media, in a one-click very friendly capacity, love that. Love that. But one of the things that I think makes an employee referral program successful is a relationship with the direct manager and like trust in senior leadership to drive that employee engagement, first in the organization, that when you have engaged employees that they then want to run the ball down the field of further with employee referrals. Is – is employee engagement and management leadership, also an important part of this equation? Or am I you know, just anecdotal.

Sam 7:39
I couldn’t agree with you more, basically. So key stakeholder buy-in is critical in our experience to implementing and getting that engagement. So one of the key things that we’ll look to do, right, right at the offset is, okay, we’ve just won this deal. We can’t have all the comms coming from just the platform without any key stakeholder behind this, we need to launch this effectively. And that requires getting somebody visible, somebody known somebody who employees will respond to talking about why they’re doing it, how they’re doing it, and trying to get them involved in it. And for So, for example, we have record videos for key stakeholders, there’ll be pushed out internally talking about what the company is doing. I’ve mentioned automated comms now that exists, but to the extent, it’s coming via email, we’ll actually set it up. So some of the key comms will come from that key stakeholder. So again, you’re more likely to get that engagement if it trickles down from the top and you get people excited about it. So I think you’re spot on. I think if you really to boost engagement, it needs to come from the top, we need to be fostering and encouraging that culture of referrals.

Brian 8:47
How does that tie to gamification?

Sam 8:49
So it’s gamification. It’s there, in my opinion, to make referrals work. There are many sort of like aspects to the game, the things we’ve talked about so far are important. But the gamification is also important. So most organizations will have a referral bonus, a success-based bonus, which is paid out on hire or passing probation. When we run, these focus groups, by talking about a lot, it’s super interesting to get their thoughts because most employees find that not particularly satisfying. They feel that it’s way too far down the line. And they’re not being recognized for the effort that they’re putting into the scheme. You know, if you think about it, if it just put myself in the shoes, like I refer, three good people, you know, albeit, you know, great people, but they haven’t been hired on that occasion. What happens? Well, I don’t do it again, participation drops off, but that’s where the gamification comes into it. So it’s super customizable in terms of how our platform works. And it needs to be because each company is slightly different each employee group slightly different. But what’s important about it is so say, we can set up as a raffle. It could be a points-based leaderboard, it can be a reward shop But in each case, people earning points, tokens, whatever you want to call it, for the different actions which lead to that eventual hire. So they’re making a referral, an application, an interview, not just the hire. And then when people start doing that, get that recognition, then when they start coming back and doing more, even if they haven’t got that eventual hiring bonus, which, which is pivotal to make these things work, in my opinion. But there’s also a campaign aspect to this as well. So, you know, we were doing a launch at the moment for a company, we’ve identified that, you know, the gamification and the rewards need to be slightly different in different areas of the business. And this was through the focus group, like, consultancy aspect that we also offer. So the gamification will look different for different areas of the business. And it’s all about knowing your customer, but knowing your employees and what they care about. And there’s an element of A B testing, of course, as you launch, but, but it’s a really important part of it, and it really helps to maintain that ongoing engagement.

Ryan 11:01
So, Sam does it – I want to make you want to change directions here slightly. So –

Brian 11:09
No, no, Ryan. No, no, no. No, you can change directions.

Ryan 11:14
Okay, I’m just not gonna ask permission first, right? Alright, so I asked about the networks over skill sets what your thoughts were there. So it really Fink, is probably for you too, because you’re doing is live with, you know, your day to day. You prefer networks, Fink, over skill sets. And then Sam, I guess what are you seeing as you’re working with your clients and all the other recruiters out there that are leveraging employee referrals are networks more valuable than skillsets? Meaning can skill sets or in certain jobs, of course, skills, skill sets can simply be trained on the job, the network, and the loyalty of that person, potentially is more important to the organization. And I bring this up because I was just before the show, I was talking with Steve O’Brian, who you guys may know. And he made that comment, and it made me think, yeah, a lot of skill sets can be trained, in call center, for example, if they’re a fantastic employee, and they’re loyal to the actual job, you can teach somebody and train somebody on how to become a call center employee or customer service associate. I’m curious to get your thoughts there.

Sam 12:27
So-

Brian 12:28
So Sam. Sam, I want to jump in here and counter that with Ryan is that i think that i think it goes back to the culture of the organization, and the employee overall engagement, right? Because you don’t want people either Sam, you may disagree with me on this. One is I don’t want people referring me their network, if we have a poor reputation with those individuals like I go back to the successes that we had when I was with the organization at Cabbage, is that at Cabbage, we got a lot of people who were really engaged with what we were doing, like, they really sought out and thought that we were you know, and we were we weren’t we were, that was acquired by American Express earlier this year, is that, you know, this is an organization that was really standing up to the status quo of how lending works. And that empowered people. And also, we had a great environment with outings, environment, and environmentalism and investment in the community. And, you know, we attracted the best the brightest of those employee referrals. And we were able to like you just said, Ryan, we were able to train for success. But I think it goes back to employee engagement, because if you don’t have a good internal comms or internal reputation, or that kind of zest, and people are just there to collect a paycheck not to change the world, I think that your employee referral networking is going to fall on deaf ears. Sam, mine is anecdotal. I don’t have the data handy to back that up. I’m sorry.

Sam 14:01
No, no. Look, I think. I think that when you’re starting a referral platform, I think like employee advocacy tools, you can make the same argument, right? It’s when you’re asking your employees to do things for you, whether it be shared job share content, they’re far more inclined to do that, if they buy into the company, and they’re happy, where they’re where they are. I think, like, obviously, that’s the case, I think that you can encourage people to do stuff, even where they’re not over the moon about the company, and they’re not loving it through the things that we’ve talked about. But, you know, positive company culture is always going to massively boost the impact and the effectiveness of a referral scheme. You know, I’d be lying if I said otherwise. But, but, you know, so I think and that’s also sorry, I should say, maybe I wasn’t so clear enough about the structure. But when we, when we first launched, we always say can we run these focus groups and It’s broader than the things that we’ve just talked about here. It’s also about understanding what they feel about the company, what what’s blocking them from referrals. And sometimes it will be a case of us going back to the TA leaders that were we’ve bought, we’ve sold the platform to and saying, look, this one is, you know, we’ve, we’ve heard from, from certain employees that, you know, they’re not that happy at the moment for various reasons. to really maximize this, to get the most out of this, you know, we’ll do everything possible on our platform. But there’s also a cultural thing here that needs that needs work to really see the great results that we see with other organizations. And I think we, as a provider, need to be honest with the people that we’re sending to the people that we’re working with about that. When we hear that from employees. I think it’s pivotal. So I don’t disagree with you. I think it’s a part of it. For sure.

Brian 16:00
Yeah

Ryan 16:01
I’m sorry about that. I was on mute talking as well. We’ll cut this piece out.

Brian 16:08
It was like, Well, I was like, I was like, Sam, I agree with you. And I was like, wait a minute, I’m on mute. Yeah, so so. So you know, we bring these up. And we talk about that engagement. One other thing, though, that I think is highly correlated with employee engagement, which was not what we set out to talk about today, we set out to talk about employee referrals. I also think employee internal mobility is important, because if people aren’t being promoted from within the organization, I don’t think that they’re likely to refer people to that organization. I think that’s one of the mechanisms that are at work to drive that innovation into drive, building those networks internally and externally. Sam, is employee mobility important in this equation? Or am I just grasping at straws here?

Sam 17:00
No, I’m glad you brought that up. It absolutely is. Um, I, I think is what – Firstly, I think internal mobility is fundamental for any organization, I think it’s obviously of growing importance. I think my prediction is that will just be a must in sort of the not too distant future. I’ve had it in my plans and in my roadmap for quite some time. Because I think the two things referrals and eternal ability can work so well together a lot, the functionality is the same as well. And we’re, we’re actually launching our internal mobility tool at the beginning of April. And that internal mobility tool will allow employees to go for internal jobs, internal projects, and connect with mentors to help with their development. And I think having the two things work as a combined product, which this will, is such a great way of looking at it because of the point you just made. If you are giving employees the opportunity to grow and develop within your organization, as you say that encourages them makes them happier makes them more likely to refer. So the two things can be so well intertwined. Which was one of the key what there are many reasons I’ve decided to build the internal mobility tool, but you know, that was one of them. Right?

Ryan 18:26
All right, so. So, Sam, when we end episodes, we always ask a question to get some, we always want to leave the listeners with some good takeaways, I want to ask you a question. And just give us three quick things off the top of your head. And you can go into details, but three quick things employers can do to start their employee referral program.

Sam 18:51
Get in front of your employees, speak, run focus groups, speak to them understand where the blockers are, is number one. Number two, I would say is, bring in a rewards methodology. Work out, okay, we’ve had this financial bonus, could we look at doing things differently? Let’s bring in some micro awards. Let’s try that let’s do some A-B testing around it. I think that’s a really quick and impactful way to change to move the dial on it. And then I really think you know, when you’re running the focus groups, try and try and work out what is it that you as a TA leader want from a referral? Is it is it recommendations? Or is it social instructions to widen networks based on skills and other areas? Now, once you’ve worked that out, think about what it is your employees perceive to be a referral, because in my experience in 90% of the cases where we’ve essentially gone in and done this consultancy piece, there’s been a disconnect and the TAs haven’t realized there’s a disconnect and the disconnect that actually can be addressed pretty easily through the right comms going out. So I would say work out what you want from a referral and work out what your employees think of referral is, see if there’s a disconnect and try and fix that.

Brian 20:15
Sam, can I ask a – Can I ask a different question? Like, in by different I mean, you know, when I think of employee referral programs, I always think of the cash money thing. So, however, if you said to me, Brian, give me a referral. And for every referral that we hire, we’re going to give you an additional week off, which could be equal to or less than, like, my wages. Does anybody do that? Does anybody give out free days off?

Sam 20:42
Yeah, so we’ve Yeah, we’ve got we’ve dealt with a company that’s done as one of the sort of prizes on a raffle, days, additional days holiday, for example. It’s a really salient point that you make because it’s something employees always say that they want. And it’s something that often gets resistance when that’s then presented back to the, to the team, the TA team. I by opinion, I think companies should do more, because I think it’s clear that employees care about it. And wants it, you know,

Brian 21:18
That I just know that I like that, like, you know, like, like, Ryan’s gonna be like, well, Brian, you never take any days off anyhow. So like, so like, me asking that, like, like, Can I have a free week off? Like, it’s kind of a gratuitous question, but I just thought that maybe there might be other incentives other than cash?

Sam 21:37
No, I think, you know, this in the gamification stuff that we talked about earlier, you’ll have those different rewards and what those rewards are, will be different from organization to organization. The key is in my, in our learnings from this, and we’ve done this with so many different organizations. Now this optionality is key. So whoever wins, whether it be a raffle, whether it be a leaderboard, whether it just be anybody can win something for accruing X amount of tokens within a reward shop, let them choose, they’re all going to be slightly different, understandably, even within an organization, having a good amount of options for them to pick from, comes back time and time again. And I think sometimes it goes slightly wrong when you think, Okay, this is going to be the prize for that that might be the price for 10% of your organization. But what about the other 90%? If you want participation across the company, you need to think about something that’s broad enough to appeal to the wider company.

Brian 22:36
A different question I want to ask. And I know Ryan already asked like the wrap-up take-takeaways, but like, but like, Sam, you got to understand is that like, before Ryan, you know, like Ryan, and I were talking like, in texting, and I was like, dude, I am so excited about this conversation. Like, there’s so many different rabbit holes for me to go down, like, like Ryan was like, Okay, calm down. I mean,

Ryan 22:57
Calm down, my man, calm down.

Brian 22:59
Is, is that um, what do you think a good metric is for the time to respond to a recommendation, or referral when somebody is referred into an organization? Do you have any data around that?

Sam 23:15
Yeah, I mean, some companies offer up, say, 48 hours. And that’s like a promise to their employees. And the data around that is extremely positive, it’s gone down exceptionally well, employee feedback on has been exceptionally well. So in terms of where I’ve seen the strongest data, they would be that 48 hours turnaround time. Now, that may not be realistic self-organization, so it can be slightly longer. But one thing that is 100% true is when you do promise, a turnaround time for referrals, it makes the difference.

Brian 23:47
Okay, and then I’m going to call out a guy that we should have on the show and saying that you should know and Ryan should know a guy named Andy Pittman, who is the director of talent acquisition for this little company called MailChimp. Trust in a funny name, they’re going to be huge someday. But like Andy and I, we talked, we’ve talked at length about this about like, you know, because MailChimp is a hot company, we’re all laughing about it and we know it to be a Hot Organization. Is that how do you you know, some refer-referring candidates always end up on the board. And why others referrals never make it to a shortlist. How do you make sure that there’s no bias there?

Sam 24:32
You mean as in like, okay, so certain employees.

Brian 24:35
Yeah like, like the VP of like the VP of engineering, that his referrals always make it on the board. But like, Sam, who’s in DevOps, his don’t

Sam 24:45
Yeah – no, completely. So our customer success team will, like call like a month report basically on a monthly basis. And they the, their contacts in the TA team, there’ll be going through that and then It will be one of the things that I look at. It’s like, Okay, so this is, this is a trend that we’re seeing, why is that happening? We give them the information, and then they can then deal with it internally. The other aspect of this is, is not only the, you know, does somebody have more influence than another person when it comes to referrals, hence the bias, but actually, okay, if we’ve got all these people are making lots of referrals, but nothing’s happening with them. Is there a quality issue there? It does some training needs to happen around referrals. So it could be one or two things, right? It could be like, why is that happening? Okay, actually looking at the quality of these referrals, they’re not quite good enough. There needs to have there needs to be some training here. Actually, no, they’re good. Just as good as the other ones. There’s a bias problem here. So it’s a case of customer success team reviewing the data, analyzing, discussing with the team, obviously, we can’t do more than then identify it and give it to them and say that, you know, let them know what we’ve observed if you like.

Brian 25:56
So, so one of the other things that I have from like, like I, Sam, I really told Ryan, like, I could go on about this for hours. So if you’re listening to the program, and you’re more worried about, Yeah, I know. I, you know, I will wrap it up, I will ask two more questions. So I think there is a conception that referrals, that, that when you hire a referral, that they spend more time at the company. That’s something that I was taught a long time ago, but I’ve never seen any data to back it up any empirical data that says that referrals stick with an organization longer than then employees that were headhunted into the organization. Do you get any data around that man?

Sam 26:37
Yes, sir. It’s a good question. It’s something we’re recording. We’re a little young to draw too many conclusions, basically to give you any data. Inconclusive if I’m honest. So it’s something that we’re monitoring. I’ll let you know when I’ve got some good data that I can share with you on that. But it’s, I agree, everybody throws around, I think it’s like 39%, better retention is the stat or something. Yeah. And then you take it into the source. And it’s like, Yeah, I don’t know about this source. It is this magic number that everybody talks about? I’ll come back to you on that. It’s something that I’m monitoring closely.

Brian 27:15
Okay, so you know what I said, I could go on for hours about this. Sam, I really appreciate it. Do you have any questions for me or Ryan? Like, because we’ve sat here, and we’ve just kind of peppered you and pelted you. And I want to give you the opportunity to beat up on Ryan?

Sam 27:36
I don’t – I don’t really have any, have any questions as such? Um, I think I think the one thing that I would just finish with is that with each new client, we end up learning a lot, a lot more randomly. But with referrals, I think you’ve made loads of valid points, really good points, and which is why it’s so around the methodology as well as the tool and getting that engagement. And we talked about him right at the beginning before we came online, but it’s something that we work closely with one of our advisors Bill Borman on is getting that customer success strategy, right. The tool is great, it does a great job. Customer success is also such a pivotal part of referrals. And, and it’s that function which is used to tackle and help with a lot of the points that you’ve you’ve quite rightly raised today.