A strong customer value proposition is what differentiates a successful brand from an also-ran. Employer branding too works on the same premise: It must project the right perception about the company in the minds of prospective employees by offering an authentic promise to them.
But the perennial problem of attracting the right talent is not going to disappear any time soon. Just like commercial branding, positioning the company to the talent pool is critical now more than ever in the wake of tectonic shifts brought by the pandemic. And there is a veritable industry of sorts springing around this concept.
Researchers have shown that a differentiated employee value proposition (EVP) can help companies of all types, especially medium-sized ones, to compete in the talent market. In the knowledge economy that we are in, not having the right talent is the biggest cost to the business. One estimate is that enterprises lose up to Dh50,000 for every middle level position that is open for three or more months. Almost one in every five CEOs says it could be even as high as Dh90,000.
Endless search for talent
Almost 75 per cent of companies agree that they do have a problem of finding the right talent to fill leadership roles. When an enterprise needs to fill up a crucial position, getting no talent - or getting a second level talent - impacts its business in terms of opportunity losses. The proliferation of ranking agencies like shows the inability of HR folks to build a good employer brand, and such rankings become the proxy.
We have enough evidence that shows the highly ranked companies in such lists have major issues of employee wellbeing. Yes, an independent, external ranking can be a good thing if its ranking criteria are adequate and not done for profit.
Although employer branding has been a buzzword for years now, not much successful action is seen on ground. The culprit? Marketing folks are not aware of this type of branding and HR is not involving them into it.
Another facet to corporate branding
Enterprise marketers need to be cognizant of the fact that it will affect the corporate brand eventually, at which point it will be serious issue for them. Only about a quarter of marketers felt that their companies had a strong employer branding.
Executives who are familiar with the concept believe that a strong employer brand will reduce attrition too. In medium-sized companies, it can be a critical tool for attracting the attention of prospective talent and retaining the existing ones.
For growth-oriented companies ideal talent target is from large enterprises who are looking for more challenging roles. Without a strong EVP that covers the unique attributes of working within the company, no employer branding effort can sustain.
Key attributes include work culture, compensation, benefits, wellbeing, recognition and awards. In a survey of executives of medium-sized companies, almost 70 per cent said compensation as a key attribute of EVP. Nearly half said growth opportunities and wellbeing were important.
While it may not be possible for smaller companies to match the perks of large ones, they have more flexibility to offer as value proposition including flexible work time and place of work, more vacation breaks, better work/life balance, role expansion, etc. In short, finding the differentiated EVP is key. The Gen-Z workforce is looking for growth opportunities as well as the commitment of the employers to ESG and DEI (Diversity, Equity and Inclusion), which is another possible differentiator.
More importantly, enterprises with strong employer branding have a 20 per cent revenue growth as against the 8 per cent of weak employer brands. The correlation is that a strong employer brand brings cost of hiring down and also people turnover – an increase of 28 per cent in retention and a decrease of 50 per cent in cost per hire.
Employers may want to consider the following for better employer branding:
- Every enterprise has an inherent EVP whether they know it or not.
- Find ways to figure out that EVP and the differentiation.
- Be authentic and truthful about the EVP, based on solid research – Bring marketing team into this exercise, and not HR.
- Publish the EVP in lucid style for everyone to understand. The media decision should be done jointly with marketing and HR based on opportunity to see.