In every organization hiring is one of the most essential functions of human resource management. Every now and then people are required for different roles to be performed at the workplace.

The process of hiring can be conducted in several ways. There are different options for how one can go by hiring employees. Advertisements, recruiting internally, using recruitment agencies, social media, etc can be used for hiring employees.

According to a Research referred candidates are better performing candidates than applicants from the general public. Referred candidates tend to stay longer at the workplace and also perform well.

Employee referral are better when the referrer and the candidate knows each other well than having a weaker connection. If the candidate and the referrer do not know each other so hiring candidates through reference or through casual applications does not make any difference.

In a typical hiring process the candidate may have some information about the job and similarly the company has a little information about the candidate who has applied by screening through the resume, application forms or references etc.

On the basis of information present with the company they try to predict whether the candidate is good fit for the company or not. Some predictions are good and some may not work accordingly.

Every company wants to reduce these errors in the decision making by hiring the right person. Rather than selecting an employee from casual applications every company thinks that referrals can be a better option and it can be time saving as well.

The referrer being an employee of the company can provide genuine information of the company which is difficult to provide in a formal recruitment process. Similarly, the company is also provided with the information of the applicant by the referrer as he knows about the work ethics, skill set, goals and other information which is difficult to provide during the hiring process.

Referral program needs to be planned in a systematic way. It is important to differentiate between high quality and low quality referrals. Hiring team shall ask the referrer that whether they have worked with the candidate or not.

After having a conversation with the the referrer it should be decided that whether to consider the candidate or not.