The Limitations of References and Referrals

Aug 24, 2017

Have you ever played a "matchmaker" by introducing two people and it didn't quite work out as you envisioned it would? Don't feel badly... we all have.

When this happens in business relationships, the consequences are much higher! It is very tempting for a business owner or manager to hire someone who was recommended by another employee, a friend, or family member.

The enticement to 'take someone's word' goes beyond just hiring employees. We see vendors being selected just because they provided great references, tenants and residents approved based on a recommendation from a previous landlord, contracts signed with partners and franchisees after a couple of phone calls to associates, and country club membership applications approved based on another member's referral.

As a matter of fact, on just about every application for any of the above-mentioned situations, there is a section for "references", as if knowing someone guarantees future conduct.

Asking for references and accepting referrals are good practices. Making decisions based only on those without conducting thorough background checks can spell disaster.

Consider the following:

  • Does anyone ever provide a reference who would reveal anything negative about them?
  • Do references and referrals really know their colleagues, friends, and family members' criminal histories or aware of their credit blemishes?
  • Will you have any legal recourse against a reference who neglected to mention something negative they knew about, or worse yet, intentionally provided false information?

References and referrals are nice, and at best, provide an interesting perspective regarding a person. However, references and referrals are no substitute for an objective, quality, and thorough background check.

A quality reliable background screening company searches a variety of primary sources and databases to reveal the history and future obligations of a person. A thorough background check can provide you with the data you need to make an informed decision so that you can mitigate risk and choose the best applicant, whether it's country club membership screening, franchisee screening, resident or tenant screening, or employee screening.

Posted by: Rudy Troisi.  President, Reliable Background Screening.




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