- Introduction
- Defining the Attrition Problem
- Strategy #1: Spend Time Developing and Benchmarking Incentives
- Strategy #2: Subsidize Education and Certification
- Strategy #3: Change Locations
- Strategy #4: Rotate Employees
- Strategy #5: Combat Poaching by Encouraging Referrals
- Strategy #6: Just Ask: Are Your Employees Satisfied?
- Strategy #7: Spend More Time Recruiting
- Conclusion
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Strategy #5: Combat Poaching by Encouraging Referrals
Rather than going through a prolonged posting process and screening a deluge of résumés, some companies poach employees directly from their competitors and offer to double salaries or buy out contracts on the spot to scale up quickly. Poaching is generally a bad idea, as it drives up salaries and discourages employee loyalty.
An employee referral program can serve as an alternative and effective recruiting strategy. Satisfied employees can be a company's best sales tool and add a personal touch that a print or radio campaign lacks. A Voice & Data survey of the top 15 Indian outsourcing companies with 1,000-plus employees found that referrals constituted 23% of new hires. For some companies, the number was even higher, at 40%. The study also observed that recruits hired through employee referral programs are "stickier"; that is, they stay with companies longer than non-referrals.