Executing a public job referral model in a down market is a very tough challenge, in fact executing a public job referral model is challenging in a healthy market.

The team at 2Vouch have made the very hard decision of switching this service off for a while whilst we focus our team and resources on building out the new application we have developed The JobGenie.

Jeremy and I would like to say a big thank you to all of those early adopter companies who advertised jobs on 2Vouch and also a BIG thanks to all of you who signed up as referrers on the 2Vouch platform.

We are still very passionate that there is a market for job referrals globally but recognise that you have to have the right business model and funding. We think we are heading in the right direction with the JobGenie.

A few points on what we have learned through the 2Vouch experience.

1. Ensure your start up is well funded to get you through the development phase with enough cash to execute your sales and marketing plan.
2. Focus, focus, focus - build enough functionality in your web application to execute your core offering. We built a BIG comprehensive application that did a lot and it probably did too much. We only know this with the benefit of hindsight. Think Twitter!
3. Venture Capital funding from Aussie venture firms is not realistically a funding option if you are a pre-revenue start-up in Australia.
4. Build the parts of your applications that generate revenue as a priority.
5. Launch early and iterate. If people like your design and think your application is slick at your launch. You’re too late to market!
6. Have the right project management and collaboration tools to manage your agile development. We use Atlassian’s Jira and Confluence. Thanks guys you rock!
7. Make sure you have direct access to your development team. We do now! We didn’t initially and that was a disaster! I will go public with who the Australian Web Development Company was that we engaged first time around but now is not the right time. Needless to say - I would never use them or recommend them!
8. As a Recruiter and then CEO of a tech start-up - I have learned so much. The last three years have been a wonderful ride and I am taking everything I have learned and applying those lessons to the development and deployment of JobGenie On Demand Employee Referral Platform.

All the Best,

Riges Younan

CEO, 2Vouch.

@rigesyounan

You would had to have been living under a rock to miss the fact that the global economic situation is currently rather poor. The Australian Treasury released a report indicating that the average Australian family has lost thousands of dollars in wealth in the last few months.

Treasury’s broadest measure of wealth — covering shares, property and other assets — fell 9.9 per cent in real terms over the year to September, the biggest slide since the figures were first collated in 1960.

It suggests that even without a recession, Australian wealth has suffered more from the current financial crisis than from any of the previous four recessions or from the 1987 sharemarket collapse.

The trouble is not just with families, organisations are feeling the pinch as well, with up market retailer David Jones and miner BHP Billiton cutting jobs as revenue projections fall.

For the average recruiter or hiring manager when they have the opportunity to hire someone today they will experience two factors. Lots of applicants and a reduced budget for advertising.

This is when you need to use innovative recruitment practices.

Placing your job on a mainstream job board is guaranteed to get you lots and lots of candidates. But are they the best candidates and how long will it take to sort through that number of applications?

There are several ways to lower your recruitment costs.

Leveraging tools such as LinkedIn, Facebook, Twitter and even Google can help you actively target the right candidate for your positions. What is more very few of these tools require you to spend money mining their data. Yes these approaches take time, but so does sorting through 100 applications!

Of course referrals will help you save time and money.

A report by Dr John Sullivan in 2006 found that while referrals might directly cost more than traditional online job boards the other benefits far outweighed job boards.

Further referrals are also faster. Vodafone in Europe found that by focusing recruiting activities on employment brand management and employee referral, the average recruiting cycle time per hire was reduced by more than two-thirds. The “CareerXRoads 7th Source of Hire” survey supports the reduced time to hire metrics, finding that the efficiency or yield of the referral process is second to none; in 20% of the time it took 2 referrals to make the hire, and 16% of the time it took 3 referrals to make the hire.

When these other benefits are translated into business performance, significant real dollar benefits were achieved. From Dr Sullivan’s report:

Here is the scenario: (Note: This scenario omits all impacts except individual performance improvement.)

• The firm has 40,000 employees.
• It hires 6,000 people per year (to replace turnover of 10 percent as well as new positions created by 5 percent growth).
• The current “revenue per employee” at this firm is $250,000 (total firm revenue divided by the number of employees).
• If you shifted all hires to referrals, you could expect to hire people with a 14.36 percent better on-the-job performance than an average employee.
• That would result in an increased revenue of $35,900 per hire (14.36 percent of $250,000).

That adds up to:

• Added revenue of $215.5 million in just one year. (Because the new hires would also stay longer, the savings would continue over multiple years.)
• Even if it was applied only to two-thirds of the hires, the added revenue would be more than $140 million.

Even using a smaller example of only 400 employees, you would be looking at a revenue increase of $21.5 million. So why not start using these tools today!

By Michael Specht, Consultant to 2Vouch on Social Media and Recruiting

Good quality referrals benefit everyone. The employer gets a quality candidate, referee is a better match for the role and the referrer has a greater chance of getting the referral bonus, building their social capital and protecting their reputation. A three way win.

Below are some tips on how to refer jobs they are relevant for both 2Vouch and in general.

9 Job Referral Tips

1. Don’t stick with your close contacts; think laterally research shows that most people get jobs referred by “weak ties“.
2. Follow through with the person you referred the job to, see if it fit them. If not, learn why, so next time the match is better.
3. If you know the hiring organisation talk to HR & the hiring manager, try not to be just a “mailman”.
4. Don’t overstate your influence in the process, remember you are dealing with people’s lives.
5. Don’t forget the rules, some companies, organisations and industries have specific rules that must be followed.
6. Don’t refer someones contact details to an employer without first seeking their permission.
7. As a recruiter don’t use a candidates references and contacts to find more prospects without giving them credit.
8. Don’t spam your social network with jobs that are not of an appropriate fit.
9. Make sure you only refer people who you would be proud to associate yourself with. The quality of the referral reflects on your personal brand.

By Michael Specht, Consultant to 2Vouch on Social Media and Recruiting

With the year coming to an end, if you have been in the stock market in the last few weeks you could have thought the world was ending, it is a good time to sit back and review your recruitment strategy and look to reduce your costs for 2009.

Today you are probably overwhelmed with consultants and companies providing options on how to upgrade/streamline/change/improve your strategy and reduce costs of recruiting. Here at 2Vouch we believe in reducing your costs to recruit as well, and not just by using our tools (although they will reduce your costs). So we have gone back into our archives and found these ten employee referral program tips from BINC Professional Search.

Recruiting should be an evident priority from the top down

There should be a clear reward system in place to reward referrals and employee recruiting

Setup training sessions that actually teach your team how to more effectively use their own personal network to recruit

Incorporate social networking into your recruiting plan

Send your team members to conferences and arm them with the tools to recruit

Host recruiting events at your office

Have somebody in HR or Recruitment (or a Direct Manager) go through  their address books and identify potential candidates and contact them directly saying you are looking for great staff

Offer additional bonuses for helping to retain the new hires or split the initial bonus into two halves

Set up a system to track all of Activity

Make a Big Deal Every time a Hire is Made Using your Program

By Michael Specht, Consultant to 2Vouch on Social Media and Recruiting

Dr. John Sullivan is widely known as THE thought leader when it comes to using referral programs as part of your recruitment strategy. Which is why his a webinar on updating your employee referral program had over 900 people attended with 70 odd questions submitted. Last week he began to publish the answers to the questions on ERE Part 1, Part 2, Part 3, Part 4, Part 5.

Some of the questions he answered:

• Working with the CFO to build the business case
• How to handle quality of referrals
• What levels of roles should be included in referral programs
• Handling payment amounts and timing
• What technology you should use (other than 2Vouch of course)

If you are interested in referral programs you should definitely read through the 5 part series.

By Michael Specht, Consultant to 2Vouch on Social Media and Recruiting

A social recruiting services such as 2Vouch relies on the fact that people know other people who might need a new job. But what happens if your network is small? How do you go about growing the network?

There are lots of ways to grow your network. Even if you have a large network your network is a living organism the participants are always changing. People change jobs, move industries, cities, and even countries. This means you need to keep “feeding” your network with new contacts to keep it fresh and up to date.

The list below was originally published on my personal blog but are worth reviewing as they are easy to implement tips on how to build up your professional network.

1. Join the social networks online
   The first step for anyone today wanting to expand their network is to join LinkedIn. Further look to join more specialised services such as FaceBook, MySpace and industry specific services ad these will provide you with different connections.
2. Attend industry gatherings
   All industries have key groups and organisations where people of similar background gather, many are free or require minimal investments other than your time.
3. Get a personal business card
   When you build your network you want to make sure that it is transportable from employer to employer. By handing out a personal business card, not one from your current employer will assist with this process.
4. Meet 5 new people
   Don’t always associated with the same people. Every time you go to a professional or social event make sure you meet at least 5 new people.
5. You are a brand
   Brand yourself to your network in order to build it further, the more people know you to more people will want to know you.
6. Globalise the network
   When you were growing up, perhaps you had a pen-pal in a different country, in a global marketplace you never know when knowing someone in Tanzania will come in handy.
7. Become an information sponge
   Use a contact management tool to record e-mails, phone numbers, and everything else you can about the people you know.
8. Take control of your virtual presence
   Make sure that when people look for you online, your image is both accurate and flattering.
9. Join the virtual communities where your target market lives
   Once you have joined one group, ask the members where else they connect with like-minded people. Be sure to look for smaller groups within larger sites.
10. Take a leadership role in your industry
    Write a blog to cover your domain, and perhaps create an online community around your unique interests.

By Michael Specht, Consultant to 2Vouch on Social Media and Recruiting

By Riges Younan

10 trends for recruiting in 2009 by Michael Specht

‘Referrals. Time and time again referrals provide the highest quality hire at the lowest cost.’

By Riges Younan

Good overview by Dr. John Sullivan. Number two on the list is “referral programs”

‘Reinvigorating referral programs. Despite the growth of career-related Internet sites, the highest volume and quality candidates still come from well-designed employee referral programs. While heavy adoption was initially hampered by cultural issues around the world, today such programs are proving highly effective everywhere. Key focus areas include proactively approaching key employees for referrals (program targeting), leverage non-employee referrals, making reward systems more comprehensive, immediate, and visible, and last but not least, helping employees leverage social media to restore relationships, make new relationships, and build stronger relationships. Firms to watch: AmTrust Bank, Edward Jones, Whirlpool, and Amazon.com.’

By Riges Younan

I was contacted by David Campbell from lovedigital last week to get my views on how digital & social media is impacting the recruiting industry. Listen here

how do you think it’s impacting our industry?

By Riges Younan

Part 2 of using referrals for college recruiting by Dr John Sullivan on ERE