We are working in the recruitment sector for a long time and we always think about turning pain points into gain points for us and HR departments. Well, what is the biggest pain point for HR professionals and circuitously company? I would say high employee turnover rate. Let’s have a quick look at the results of high employee turnover rate for a company and HR people briefly.
1. Revenue – according to research conducted by The Center of American Progress, the median cost of turnover was 21% of an employee’s annual salary. Also, we need to consider hiring expenses, training labor and lost sales.
2. Low workplace morale
3. Deteriorating product or service quality
4. Reduction in Marketing ROI
Why would employee turnover rate be high in a company? Because employees quit! They say “It’s not you, it’s me!” and leave the company. They want new challenges maybe they want a better work/life balance or maybe they want to work for a company with a better reputation and they leave. In addition, most of the millennials do not need a steady reason to quit their job but we will talk about ‘millennials’ in the next blog posts.
Considering gain points of HR department, we decided to focus on employer branding which helps businesses compete for the best talent and establish credibility.
“A company has a reputation in the market for its products and what it sells. But companies also have a reputation as employers.” says Jason Seiden, the co-founder of Brand Amper. In today’s world, the reputation, culture, working environment are important more than ever for talents.
96% of people agree that alignment of personal values with a company’s culture is a key factor in their satisfaction working there according to The Randstad Employer Brand Research 2017.
In this blog post, I highlighted 3 things -especially- HR professionals should know about employer branding.
What is Employer Branding?
First things first – what is exactly employer branding? CIPD defines employer branding as “a set of attributes and qualities, often intangible, that makes an organisation distinctive, promises a particular kind of employment experience, and appeals to those people who will thrive and perform best in its culture”.
Employer branding comprises the organization’s mission, values, culture and personality. Hence, all organizations have an employer brand; the most strategic step is controlling employer branding as much as possible.
Employer branding is a strategic tool to attract, recruit and retain the right/best talent.
Employer branding is something that you, your employees and your employees’ network build. For instance, Matt is your employee and Matt conveys the incredible corporate culture, demonstrates passion for the company’s mission and values and illustrates the meaningful work he does. To his family, to his friends, his acquaintances and his peers. Your employer branding is what Matt and many employees tell their friends about you. So, you can influence it and that takes time and effort but you can’t control it!
Why is Employer Branding Important for Companies and HR Departments?
By implementing a well-aligned employment brand, organizations can increase their likelihood of attracting and retaining employees that best ‘fit’ their culture.
Tim Brown, SPHR
A strong employer brand is important in helping your organisation stand out from your competitors when it comes to attracting the top talent within the industry. Here are the other benefits of a strong employer branding:
Increasing brand power, credibility and employee engagement
Business performance and customer experience
Spending less time to fill a vacancy
Increasing referral hires
Decreasing recruitment ads
Displaying human side of your company
Employer and customer advocacy, retention and brand reputation
A great employer brand can make up for lower numeration: while you might not have a huge salary and bonus package to be able to offer your candidate, a strong and appealing employer brand can help to win them over.
Let’s give an example from the real world:
“What’s the Matter with Owen” – GE Employer Branding Campaign
General Electric is one of the world’s most long-established companies. However, they clearly want to reposition themselves as a digital industrial company. From an employer brand standpoint, they place themselves as a place where young technologists can go and do meaningful work. The advert says us “Applicants to GE should be motivated valuable, cutting edge work. We are actually looking for them.”
Why have a strong employer brand?
Because candidate equals customer. As a HR professional and employer, you want to attract the right people in terms of performance as well as culture, vision, work ethics and more. Then you need to create a positive ‘customer’ experience for candidates during the interviewing process.
When you differentiate your company from competitors through a unique Employee Value Proposition (EVP), you will be able to demonstrate what makes that company unique and attractive. According to Glassdoor research, 61% of Glassdoor users report that they seek company reviews and ratings before deciding to apply. They research the jobs, salaries, reviews, culture and even employees to decide if the company fits their requirements and expectations. It is very important for you to target new candidates/top talents/graduates.
What about your current employees? Inside of the company, you will see an increase in engaged and enthusiastic employees with higher level of motivation as they are proud to be working for a company with a strong reputation. A strong employer branding will bring you a referral program which helps fuel your talent acquisition and employee engagement strategy.
Referrals are 5x more likely to be hired and begin their position 29 days quicker than candidates sourced via other methods.
The ultimate goal of a strong employer brand is to engage and hire more and better candidates for your company. Once these candidates become employees, they will expect to live the brand they experienced during the recruitment process. In addition, when they have a good candidate experience, they are will mention your company on social media or ranking websites and they will influence potential candidates which brings you an increase in your talent pool.
To discuss in more detail your employer brand strategy; call our MD, Edward Conmy, on 014852775 and he’ll be happy to help!