In the seemingly neverending struggle to find quality employees in one of the tightest and most competitive labor markets in recent memory, organizations can wield a low-cost and effective — perhaps even surprising — secret weapon: former employees.

As counterintuitive as it may seem, increasing numbers of companies are establishing formal programs aimed at retaining relationships with ex-employees. Even though they’re no longer part of the team, keeping in touch with them can help build companies’ brands by creating a band of external ambassadors, says Matthew Call, a professor of management at the Mays Business School at Texas A&M University.

These alumni networks can also generate quality job candidate referrals, maintain access to departed institutional knowledge and even provide channels to new customers that previously were inaccessible, he says.

“The need to leverage the power of former employees has grown on the heels of the ‘Great Resignation’ because there’s this hyper talent war going on,” Call says. “More and more companies are realizing that employees don’t have a sense of loyalty anymore, so they’re trying to up their games and make use of this revolving door of turnover. I think this trend is gaining traction nationwide as companies begin to understand the benefits.”

The advent of job-search websites such as www.glassdoor.com and www.indeed.com make it even more important to stay in touch with ex-employees. Why? They provide a forum for people to post reviews of companies they either work for or have worked for, and job hunters read those reviews in just the same way that Amazon customers read product reviews to make purchase decisions.

“This shows how ex-employees can either build or hurt your company’s brand,” Call says. “I can’t verify this, but I’ve heard that something like half of the reviews on Glassdoor come from ex-employees. And data shows that companies that focus on alumni networks get better reviews on Glassdoor.”

Furthermore, some ex-employees might even find the grass isn’t greener on the other side of the proverbial fence and become so-called “boomerang” employees who return to their former employers, notes Call, who’s researched the issue for about seven years.

“Ex-employees are a good place to start when looking for talent because you know them and they know you, so there’s much less uncertainty involved,” he says.

Building a network

These programs can take several forms. It could be something as simple as keeping a database of former employees and their contact information and sending them periodic newsletters. Or companies could establish virtual communities on social media platforms such as Facebook or LinkedIn to keep ex-employees in the loop about company doings.

Some companies even hire firms to manage these groups of ex-employees, Call says.

If companies handle things on their own, it’s typically a human resources function. Some companies dedicate a human resources employee to supervise these networks; platforms such as Hivebrite, PeoplePath and EnterpriseAlumni can help them manage and engage alumni.

Other strategies include inviting former employees to company functions (think holiday parties, for instance), invite former employees who’ve become stars in their respective fields to come back and speak about their accomplishments or simply celebrate the departures of valued employees, Call says.

And when onboarding new employees, it’s important to tell them about the alumni network to reinforce a one-for-all, all-for-one mentality, he says.

“You need to embed this in your culture — give employees the sense that they’re part of an extended family that’s still respected even after people leave. It also shows them that your organization sees employees as people, not merely human capital. It sends an interesting message that former employees still are valued instead of shunned.”

That, in turn, can reduce turnover because it builds mutual respect between organizations and employees.

Training is critical

Managers also need to receive proper training so they don’t undermine alumni programs. They shouldn’t send mixed signals about or disparage former employees and need to learn how to react when an employee resigns, for example.

Those are the kinds of critical moments that can determine if a departing employee will become a good resource, and role-playing can be very helpful in training, Call says.

Some companies even go so far as to link formal and informal incentives for managers to metrics, such as how many former employees participate in alumni networks, how many former employees rejoin the company or how departing employees rate their exit interviews.

Of course, there are downsides to alumni networks, too. For example, companies that employ celebratory rituals when employees leave make it easier, on some level, for other employees to leave. And alumni networks and functions can provide bitter ex-employees opportunities to poach other employees or glean proprietary business intel, Call says.

Be judicious

Which raises another point: If employees are fired for poor performance or behavior, you probably don’t want to include them in your alumni network.

“There’s one assumption built into all of this, and that is you want to maintain relationships only with regrettable-turnover employees — someone you didn’t fire. Sometimes you have to let good people go because of downsizing or reorganizations, but you still want to stay in touch with them.”

Moreover, sometimes employees are required to sign nondisclosure or no-compete agreements that can make it more difficult to sustain relationships. In addition, maintaining relationships with some employees, such as workers at big-box retailers, may not be as beneficial as others, Call adds.

In the end, however, organizations must treat employees well and create a culture of mutual respect and trust in order to most effectively leverage the power of ex-employees.

“If you start an alumni group and managers still treat employees like trash, it’s just not going to be effective,” Call says. “You have to have the right culture, the right incentives for managers and so forth. You can’t just set up an email group and expect good things to happen.”