How Dell Revamped Its Employee Referral Program

Five years ago, Dell’s global employee referral program had no central administrator and inconsistencies in referral payouts, which caused strife within the company. Knowing it could do better, Dell’s talent acquisition team reviewed and improved its program, which is available in more than 160 countries. The result: a 50 to 125 percent increase in global referral hires.

“We knew we had serious challenges with our employee referral program given the volume of complaints in many locations,” said Jennifer Newbill, senior manager, global candidate attraction, engagement and experience, at Dell. “We were expending a significant amount of time to constantly monitor and manage queries and complaints.”

Some of the issues uncovered during the company’s review included:

• Lack of a global program owner. The policy was managed and interpreted differently country by country and there was no central point of contact, resulting in misunderstandings and an overall lack of promotion of the program internally. It was also difficult to pay for referrals submitted for people in other countries.
• Inefficiencies caused by recruiters manually tracking referrals. If one of them inadvertently missed a payout, it created “exceptions, requests and frustrations on the part of the employee and payroll,” Newbill said. This also resulted in an inability to track global spend and led to potential errors in logging and reporting.
• Outdated or flat payout amounts. In addition, “Some countries didn’t have an agreed upon amount and would have to wing it when a referral was made by someone in that location,” Newbill said.
• Lack of social sharing of jobs, which resulted in confusion among employees on how to refer a candidate to a role.

What Dell Did

Newbill said Dell approached the initiative to rebuild its employee referral program by breaking it down into five sections: organizational structure, promotion, policy, process, and tools and training.

The company created an organizational structure with a global program manager at the top, assigned to lead the program globally and across regions. Teams were created within each region, and specific recruiters in major countries were asked to help with promotion, education and development of new ideas to drive a greater number of referrals.

Dell tailored promotion strategies to each country and location to ensure that local practices were used. It also reviewed all global referral processes and procedures to identify best practices that could be scaled globally. “We found that constant and consistent reminders about the program is critical,” Newbill said.

Promotion strategies included:

• Graphics that clearly outlined the program and process for referrals, with the theme “What will you do with your referral bonus?”
• Biweekly e-mails sent to all employees in particular locations listing the latest job openings and requesting referrals.
• Branded newsletters and monthly updates to regional recruiting teams.
• Communication during onboarding.
• Global and local recognition for “referral rock stars.”
• Internal career fairs and friends and family referral events.

The company reviewed regional policy differences and created one consistent policy, though “regional talent acquisition leads are encouraged to challenge elements of policy and provide feedback or ideas for improvement,” Newbill said.

In an effort to create better transparency, all payout amounts are posted online in local currency. “All employees can now see what the payout amount is for a certain grade level in any location,” she said. A process was also designed to support cross-country referrals. “For example, if a team member in Russia refers someone in the United States, that team member is paid based on Russia payout terms and currency. The rationale is that people will always receive a fair and locally reasonable payout and never get paid a much smaller or higher amount.”

Dell increased employee education and awareness of the referral program and implemented new tools to help manage it. The company created user guides, training and videos; simplified relevant fields in the applicant tracking system; and created a social sourcing tool to share jobs on social media. The Dell Talent Community was rolled out globally in October 2013 and since then “over 100,000 jobs have been shared socially. All socially shared jobs account for 30 percent of referrals globally,” Newbill said.

Results

In addition to an impressive increase in referral hires, the revamped global referral program was one of several initiatives that resulted in a 20 percent overall decrease in cost-per-hire over the last three years, Newbill explained.

The use of consistent values in payouts allow for better global forecasting, she said. “Now that we understand spend by location, level and business unit, the recruiting team can better update and inform the business.”

Additional benefits of the overhaul include:

• Payouts that are disbursed consistently.
• More accessible data for recruiters.
• More global participation “now that employees have clear guidelines on things like cross-country referrals, payouts and timing, referral levels, and amounts,” Newbill said.
• Administrative time savings roughly equal to the work hours of one full-time employee.
• Consistent monitoring of exceptions.
• Improved documentation in multiple languages to be able to support any payout or denial of payout with a clear reason.
• Centralized tracking of referral sources, ensuring better reporting, forecasting and transparency.

Read more about Dell’s experience overhauling its employee referral program here.

Roy Maurer is an online editor/manager for SHRM.Follow him @SHRMRoy