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Referred candidates seem to be hailed as the best way of getting in new candidates. They seem to be reliable, easy to approach, and often lead to quick hires. However, if that leads to desired results remains to be a question.
Referred candidates are candidates who are referred by somebody else as a potential match. Referrals are often seen as the easiest and best way to attract quality candidates. Anyone inside and outside the company can refer a candidate as a potential match, but it is most often your own employees who refer a possible candidate. It is often seen easy and low-barrier way of getting in more quality candidates. As everybody is well aware of the advantages, I would like to dig in a bit into the potential disadvantages of referred candidates. In this blog I will start off with a quick summary of the main advantages and then go a bit more in depth into the main disadvantages.
The advantages of referred candidates
First, let’s get into the most obvious advantages: it’s cheap and fast. Most referrals are practically cost-less and, because there is an instant connection with the candidate via the referring person, the process moves faster. Secondly, there are also advantages because of the relation between the referring person and the potential candidate. The referring person will most likely not send in a bad candidate in fear of reputation damage, which guarantees a certain degree of quality, and will most likely also motivate the candidate to perform well in the process. Furthermore, if your employees refer candidates then they automatically get more engaged with recruitment and the company in general, because they feel engaged with the decisions being made in the company. Last but not least, referred candidates make for a more homogenous group of like-minded people as employees. They, in general, make decisions faster and work smoother together than heterogenous groups.
The disadvantages of referred candidates
Now that is over with, let’s get into the juicy part; how can it possibly a disadvantage to have a referred candidate come in?
Let’s start where we left of, with the difference between homogenous groups of like-minded people and the heterogeneous groups of non-like-minded people. Most employers think it is better if you have like-minded people who work smoother together. However, that is very much a myth (read more about that here). Open up any HR textbook and it will tell you that diversity is a good way to balance and improve your company. If you are going for candidate referrals chances are that the referred candidates are very much alike the people you already have, which harms your diversity.
Another potential problem is the strong potential for bias in the interviews. As somebody refers a candidate, it might be easy for a recruiter to believe that the candidate is already to a certain degree qualified, because he or she got referred in the first place. This might easily slip into the confirmation bias or the expectation anchor bias (read more about that here). Ultimately this bias could end up problematic if you it is not caught on later in the process. It is especially harmful if the candidate eventually gets hired and it turns out that he or she does not fit in the team or role whatsoever.
Personal relationships intertwine at work
The third possible disadvantage is the fact that if an employee refers a candidate, there is often a personal relationship between those to as well. Firstly, this could cause for clique forming if there are too many like-minded and personally related people working in the same company. Secondly, it could also affect the referring employee in his or her openness. He or she might be more closed down because they do not want to worry about embarrassing themselves to somebody who they know outside of their work. Furthermore, they can become biased towards the candidate they’ve referred and pick their side in discussions and meetings.
More often than not, people who refer candidate have a certain expectation of the outcome. It is not that they feel entitled per se, but they do expect a special treatment towards their referred candidate (with whom they are often personally related as well). This can cause internal conflict if the referring person does not feel like his or her expectations are being met in terms of how the referred candidate is treated. You can think about examples such as: how interviews are conducted, how the candidate is being held up-to-date, or even how a message declining the candidate is being send.
When working with candidate referrals, there is a certain dependency on the referring employee. While the recruitment process is ongoing, it can be that the direct communication between the referring employee and potential candidate is necessary to speed up the process (or in the most extreme cases; to enable any movement in the process at all). After a candidate is hired, the referring employee often remains to play a key role in the management of the newly hired candidate. Often the candidate tends to cling onto the referring employee as a sort of mentor and to show him or her the ropes in the company. This might hinder other processes in the company, such as the standard onboarding or becoming a part of the designated team. The most dangerous scenario is when the referring candidate is leaving the company at the same moment when the newly hired candidate joins. This can create a weird kind of feeling of loneliness and mistrust in your company for the newly hired candidate and, without proper management, you might even risk losing two employees.
Candidate referrals are crucial to any hiring process. They are easy, fast, almost cost-free, guarantee some sort of quality and internal engagement. However, there are also certain possible disadvantages with referred candidates which should not be overlooked, such as: lack of diversity, possible bias, intertwining of professional and personal relations, and an expectancy of and dependency on the referring employee. These are not impossible to overcome, and if you can overcome them, then candidate referrals are amongst one of the best ways to attract candidates.
Do you need help overcoming these disadvantages? Get in touch with us and find out what we can do for you.