Why Referrals Are Losing Value And The Value Itself, Explained!

Referral hiring has been one of the most effective methods for organizations to build reliable and enduring teams, especially on the management side. Referrals worked because it brought in people with proven or tested abilities and persona, to say the least. While many other aspects can be relied upon to test them, few factors (assurances) still remained missing. And with the advent of referral hiring and networking as a part of recruitment and job search, it has started to lose the charm. Let's understand it first.

Coming through an existing employee, an endorsement gives boost to the candidate and also makes the recruitment process a two-way test,

One, to get the candidate from a person who knows the organization from inside and thus, the perceived connection of the candidate and team might work better,

Two, testing the judgment and/or understanding of current employee(s) towards other members and needs of the organization.

But as time and technology went forward, standardized practices took over most of it, while referrals reserved a special spot in the job applications.

While still in use, extensive information about individuals is readily available, and thus, the overall judgment is majorly influenced by the knowledge. Exceptions are always there, but general cases and scenarios witness the influence.

In order to analyze whether referrals are still up for consideration, here's a look at the recruitment process with and without them:

• Job Application without referrals goes directly with other applications and with the regular processing, while referrals go direct and have a faster processing due to point of contact available. Counting it as a neutral advantage, it does bring efficiency to the process.
• Test and Interview Calls, especially pre-visit

telephonic interviews can have positive results with a greater probability, considering the same conditions with a un-referred applicant. The advantage here is the positive image the call begins with due to the reference, which affects the overall process.

• Interviews, again, may share the same overall advantage. But the profiles and other information (relative to other candidates) tend to shadow the fact and interviews become almost unbiased.

Seeing the above, while referrals certainly provide an advantage in the process but not so much as to substantiate recruitment itself. Job search without referrals is almost the same process after applying. Although, on the other side of the story, referrals can actually make a difference if processed properly.

The point to consider with references, be it the recruiter, the referrer, or the candidate, there is a broader analysis in the recruitment process, especially interview, that needs to be done. Its relevance depends on the amount of unique data it provides that can't be acquired otherwise. And bringing in the referrer in context can do exactly that.

Interviewing the referrer for why, how, and what will be the positives (and negatives) of hiring the candidate. It can lead to a better organizational setup whether or not the candidate is hired, because of the better understanding of the decision.

Opinion: With all the information available, references have lost their value in most cases. For upcoming times, unless the recruitment processes evolve, they will lose value further. However, getting a valuable reference will certainly lead to a substantial boost in the job search.

The value depends on, One, profile, if it is related and senior to that of candidate, Two, experience, the more the better, Three, position, at least a few ranks over the applied profile, Four, involvement, whether the referrer is directly or indirectly involved with the organization, Five, credibility, whether unproven or tested in past (not necessarily with referencing but work in general), and Six, relationship, with the candidate (professionally; personal doesn't make a positive difference) and with the organization as well.

If the six things check out, it calls for a very strong endorsement, getting which is not easy either, both the traits and the reference itself. Although, the most important of all these are Credibility and Relationship. A person whose work and/or judgment is proven is always bound to give more reliable and better recommendations. Similarly, the relationship of the referrer with the organization and the candidate will define the resonance of values that can connect them better. If these two criteria check out, especially for recruiters, it can be considered a good endorsement.

So, however, the value may have faded, referrals still hold a very high regard when it comes from the right people. And so, it is important to network inside and beyond the industries to create relations that help one grow. More on this SOON!

Analysing general Industry and employment trends in India.