As companies struggle to attract the best talent and differentiate themselves from competition, employer branding assumes greater significance than ever before.
According to our research, companies with good employer brands spend 10 percent lesser per hire.
In a recently conducted survey, nearly half of all respondents surveyed said they would rule out a company with a poor reputation even if offered a pay increase. Even a 10 percent pay raise would convince only 28 percent of candidates to sign on the dotted line.
Does employer reputation trump salary?
According to the social identity theory, strong brands offer more benefits to an employee’s self-esteem and social status than organizations with a weak employer brand.
The value of social status and self-esteem represent strong non-financial rewards of working and drive employees to work in organizations that they feel provide these benefits in lieu of more pay. A study revealed that close to 40 percent of both active and passive talent can be attracted with no increase in pay. The trend is more pronounced in younger professionals (18 to 34 years) who are significantly more likely to accept a slight reduction in pay to get a foot in the door of a company with a positive employer brand.
When you add this to the estimate that employers who fail to invest in their reputation could be paying up to an additional 10 percent per employee hired, it is easy to see how a strong organization brand can lower payroll costs.
That brings us to the question – what do organisations need to do to develop a strong brand?
Higher talent branding index, lower payroll costs
An organization’s reputation hinges on good management practices, quality products and services – and above all, the right talent in the right place. According to our employer branding insights, the top five factors influencing the choice of employers were:
- Salary & employee benefits
- Long-term job security
- Financial health of the company
- Pleasant working atmosphere
- Good work-life balance
Employer branding in a multi-generational environment
To attract right talent across generations, organisations need to be aware of the specific buttons that they need to push. Our research gives insights into each of the generations to help you build a strong employee value proposition.
Attracting traditionalists: The ‘traditionalist’ must see your company as one that allows them to visibly contribute to their success, provides them a team environment and scope to building relationships.
Attracting baby-boomers: This generation must see you as adding opportunities for advancement, compensation, perks and recognition.
Attracting Gen-Xers: The Gen-Xer need to see a stimulating learning environment that allows independence of working with the latest technology and visible progression plans.
Attracting millennials: Millennial look for challenging work and global opportunities. Policies, communication, social and internal sentiments must consistently echo these branding aspects.
Right branding through right fit
An organisation’s branding also depends on how employees about their fit in the organization and how candidates talk about the fitment in the hiring process. Adopting an intelligent evaluation for attracting and retaining the ‘right talent’ is critical. Organisations would do well to take a holistic view of the fit between the individual skills for the job, the team's goals and dynamics driven by the line manager and the organization’s vision and culture. This leads to engaged and loyal employees, satisfied candidates – all that leads to strong branding and lower costs on all fronts – recruitment, payroll, and retention.
Investing in your company’s brand literally pays off when it comes to hiring the right talent. By providing additional non-financial benefits, a strong brand can optimise payroll costs for a ‘win-all’ situation.