Influence of Various Factors of Employee Referral Program on Perceived Employee Performance in Information Technology Industry

Abstract

Finding right person for the job is a great task for the HR managers, and they spend more time and money in the searching process. Nowadays companies adopt referral program to identify the talented person for the job specified, which is the practice not only in Information Technology industry but also other industries as well. Great employees are the foundation of a successful business, but finding them can be challenging. Employees who are hired through referrals tend to stay with the company longer than other candidates. An employee referral program (ERP), whereby employees recommend qualified friends, relatives or colleagues, can be an excellent source of candidates. For the employee whose recommendation leads to a hire, there can be various rewards. This study is aimed to find out the importance and experience of employees towards employee referral program. Data has been collected from 429 IT professionals in Chennai. Result shows that ERP is the shortest path to better quality hires, however, friends referred by the employees may not be selected by the company. Respondents opine that the people they referred were happy in their organization and their performance is good. Among the factors of employee referral program, employee recognition is the highest predictor of perceived employee performance.