'Get Rich' Campaign Hoists TRW Group's Hiring Numbers
'Get Rich' Campaign Hoists TRW Group's Hiring Numbers
By Cindy L. O'Hara, Staff Writer
TRW Inc.'s Systems and Information Technology Group is so hungry for high-tech talent that it gave away more than $350,000 in cash awards last year to employees who lured professionals to the $3 billion unit
The unit of TRW Inc., Cleveland, began augmenting cash awards in January 1999 for employee referrals that had ranged from $500 to $5,000 through its "Get Rich, Or Jane, Or Chris" employee referral campaign.
Under the Get Rich campaign, domestic employees of the group are eligible to win up to six cash awards ranging from $2,500 to $20,000 throughout the year. Participants included domestic employees at all levels in the group, excluding certain managers and those involved in the recruitment process.
The program was launched to meet "aggressive staffing goals" in 1999 for the Reston, Va.-based group, which employs 15,000 people in over 200 locations worldwide. The target was to add 3,000 employees, but the group exceeded that number, adding 3,400 new hires last year, said Kellie Schroeder, human resources manager and recruiting program administrator.
The Get Rich campaign yielded 700 of those new hires, culled from about 2,400 employee referrals, she said. But like much of its competition in the exploding IT arena, the group still has 700 openings nationwide for positions ranging from systems administrators to software engineers to programmers.
"Candidates are in a very strong position," said Bob Waters, vice president of human resources for the TRW group. "It's easy to walk out the door and down the street if someone's going to offer you a better deal."
Group senior executives have said the group is positioning itself to play a dominant role in government outsourcing and command and control projects. TRW Inc. is a global supplier of advanced technology products and services for automotive, aerospace and information technology markets.
Under the Get Rich campaign, which group officials plan to continue in 2000, there is one $2,500 drawing per quarter. Group employees can participate in any quarterly drawing that is held in the quarter that an employee they referred joins the company.
In addition, there is a midyear drawing of $5,000 and a year-end drawing worth $20,000. TRW officials said the $20,000 cash prize drawing will be held in early 2000 at the Reston location.
The overall quality of the new hires from the Get Rich campaign "has been very good, because employees know best what type of employee would do well in this type of environment," said Schroeder.
Brian Felch, a software engineer with the Systems and Information Technology Group, has stepped up his recruiting efforts since winning $2,500 in last year's second-quarter drawing. Felch said he has referred two other candidates and is on the lookout for more.
TRW's Get Rich program stems from a referral program BDM International Inc. had in place when TRW acquired the McLean, Va., systems integrator in December 1997. At one time, BDM gave away sports cars and vacations as part of its year-end incentives to reward employee recruitment efforts. After the acquisition, however, TRW surveyed its employees and found that most would rather have cash.
Waters could not say how much money TRW has saved in advertising and other costs through the employee referral programs. But Calvin Hackeman, a partner-in-charge at Grant Thornton LLP, a technology consulting firm in Vienna, Va., estimates that government information technology companies spend anywhere from $5,000 to $7,500 to attract a new hire.
Not only is the money in TRW's referral campaign substantial, but "the employee is engaged and consistently thinking about the program," said David Downer, a benefits and compensation consultant for the Segal Company in Washington.
"Typically, these kinds of things are announced one day and forgotten the next, but by doing the lottery, it keeps it festive," Downer said.
"I've never heard of a second level of compensation for an employee," said C. Michael Ferraro, president and chief executive officer of Training Solutions Inc., Chantilly, Va., and vice chairman for the Workforce Initiative at the Northern Virginia Technology Council. "But who better to speak for your company than current employees?"
The program does entail extra work. Among the challenges are making sure employees in other TRW locations have filled out their paperwork and ensuring that everyone eligible to participate in the yearlong drawings is registered properly, TRW officials said.
Another information technology contractor with a healthy employee referral program is SRA International Inc. of Fairfax, Va., which had revenue of $292 million in fiscal 1999. Approximately $249 million came from federal government business.
Kerri Koss Morehart, director of recruiting for SRA, said that for the past five years her company has offered employees a referral program that is comparable to TRW's.
"Our program has been very successful, [and] people know that we have the market on this idea," said Morehart, whose company currently has more than 150 job openings.
SRA offers employees who make referrals bonuses of $500 to $1,200, depending on the new hire's level of expertise. "If the skills are in high demand, employees can earn an additional $750 to $2,000," Morehart said.
At the end of the year, SRA has 10 different prizes, ranging from dinner at a restaurant to a cruise for a family of four to cash prizes. Those cash prizes include awards of $10,000, $25,000 and a grand prize of $50,000, Morehart said.
SRA has paid out approximately $300,000 annually in recruiting bonuses and associated prizes during the past five years, she said. And the company plans to spend slightly more than $300,000 on the program in 2000.
Of the company's 1,832 employees in fiscal 1999, approximately 300 came from the employee referral program, Morehart said. Company officials are hopeful they can raise the number to 400 in 2000, she said.
Giovanna Patterson, technical director for SRA's civil government systems, knows firsthand what it is like to be a winner. Patterson, who joined SRA two years ago, has referred 20 people to the company. Of those, five people were hired, she said.
In 1997, Patterson received three raffle tickets, one for each new hire, as well as $3,600 in bonus money. But it was not until 1998 that her recruiting efforts paid off in a big way.
That July, after receiving $2,400 in bonus money for her two referrals, Patterson won a cruise for four to Alaska, but opted to take the $14,000 cash alternative to make home improvements and a down payment on a new car.
Another large systems integrator, Lockheed Martin Corp. of Bethesda, Md., has sparked recruiting interest among its 160,000 employees by holding $2,000 quarterly lotteries in addition to referral bonuses of $500 to $5,000 for new hires.
"We've found that what makes an employee referral program successful is generating excitement in the employee population. [And] the opportunity to win a nice cash prize is a good way to generate that excitement," said Tracey Staley, director of staffing at Lockheed Martin.
Although the systems integrator historically spends approximately $1 million a year on its employee incentive program, the company still has 8,000 openings annually, said Winston Watt, staffing manager of Lockheed's Management and Data Systems unit in Fairfax, Va.
"Our program is no different than what any other business is doing," Watt said. "Historically, we have gotten good referrals [because] an employee's reputation is on the line, so there's a stake there."
Incentive programs on the West Coast among systems integration companies lack the creativity and flexibility of their East Coast counterparts, according to David Goldstein, vice president of Washington operations for Knowledge Workers, a recruiting and consulting firm based in Englewood, Colo.
"Companies here recognize that it's cost effective to invest money in referral programs," Goldstein said. "By increasing money in referral programs, clients are finding that they're not only getting people, but getting people to stay."