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How To Master The Fine Art Of Making Useful Referrals

Connecting people can either be a welcome help or totally backfire in your face. Here’s how to make referrals that make everyone happy.

How To Master The Fine Art Of Making Useful Referrals
[Photo: Flickr user Ben Husmann]

Referrals are a powerful way to connect people within your network. But under the wrong circumstances, even a polite, well-intentioned referral can go awry. Just ask Kathryn Aragon, CEO at Kathryn Aragon Media in Loredo, Texas. After a client made increasing demands on her time, Aragon stepped down from the project and suggested a colleague to take her place so the client wouldn’t be left high and dry. “I even told him I would coach her through the project,” she says.

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But the client mistook her offer to help with the transition as a willingness to continue on the project, and he was unwilling to work with a replacement. “I think what he was visualizing was himself being the CEO of this gigantic brand and trying to engage with contract labor the same way you would engage with an employee,” Aragon says. After the client became increasingly irate at Aragon and the colleague she tried to refer, the referral fizzled out.

Read on for expert advice on making referrals.

Only refer people you trust.

Don’t give out referrals willy-nilly like candy on Halloween. “People need to remember that any referral, personal or professional, reflects directly on them,” says Debra Sercy, co-CEO of Grace Blue North America, an executive search firm in communications in New York. “Your name is behind any referral you give, whether it’s for a plumber or a CEO. Only introduce people who will make you proud.”

When someone asks John Jantsch, founder of Duct Tape Marketing and author of The Referral Engine, for a referral he’s not comfortable giving, “I just tell them, we’ve never worked together, I don’t know your work well enough to make that connection,” he says. “Maybe you can share more information about what you’re doing.”

Know their business.

Understanding the nature of their business and the types of people they work with ensures that your referral is relevant and useful. If your colleague needs someone to edit a documentary, you may not want to refer your sister-in-law who’s only ever worked on a few infomercials. Referrals made through multiple degrees of separation (for instance, when you refer your husband’s friend’s neighbour rather than someone you’ve worked with directly) often aren’t effective either for the same reason.

“You really only want there to be one degree of separation,” says Justin Tobin, founder and president at innovation consultancy DDG, who says he fields lots of referrals for potential hires and clients.

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Get buy-in from both sides.

Referrals can fall flat when one of the parties being referred doesn’t know it’s coming or doesn’t have the time or inclination to follow through. “I personally like it when somebody does give me a heads up on either they’re going to or they think they should introduce me to somebody,” Jantsch says.

Before introducing people, contact the parties individually to make sure everyone is interested in the referral, a concept called the double opt-in email introduction.

Be specific about why they should connect.

The least helpful kind of referral is where you simply say, “You’re both doing interesting work; you two should connect” without any context on how you know the other parties and why you think they should meet. In evaluating a referral, Tobin asks, “What’s the relationship between us and the referrer and then the context between their relationship? How long have they known them? Have they actually worked with them?”

Get specific about how you know the person (for instance, “Jane and I worked in the accounting department of XYZ Company for three years before she started her own firm, while John and I are in the same start-up accelerator”) and why they’re a good fit (“John mentioned his company needs a new bookkeeper, and Jane specializes in helping fast-growing startups get their financials in order”).

Don’t expect tit for tat.

Some companies offer referral fees for bringing in new business or new hires. But don’t expect to be compensated every time; make a referral out of a desire to help others, not grow your bank account. “A referral should be a social action,” Jantsch says. “When you attach a fee it becomes a financial action and changes the motivation to helping me.”

Susan Johnston has covered personal finance and business for publications including the Boston Globe, Entrepreneur.com, and USNews.com.