The impact of a strong global Employer Brand in the war for talent

Bachelorarbeit von Romy Kupfernagel

Introduction:

Defining the task:

Microsoft, Google, Cisco or the German E.ON-’Führungsgesellschaften’: each of them is a well-known company that not only stands for economic success but also for a specific image. Besides, all of them are companies that head the top 100 of the ‘Best Workplaces in Europe’ in 2009. But, why are companies rewarded as a great place to work at and how do they manage it? Do they only convince with their products and services based on good marketing strategies?

In an era of globalisation and a continuous progress in science, technique and economy being competitive poses the most important challenge for a company’s success. Of course, product and service quality or customer orientation are important factors but moreover, high qualified people performing in and leading these areas are indispensable. However, even though having an economic crisis actually, this resource is a scarce one and not easy to find. On the one hand, this is caused by a strong socio-demographic change that implicates declining birth rates and thus a rise of ageing workforce. On the other hand, for competing globally companies are demanded to be highly innovative. To expedite innovations and to deal with continuously accelerating progress and more complex technology, skilled workers are needed. Hence, on labour markets the demand for high potentials is increasing whereas the supply is decreasing. As more companies are aware of the possibility to profit from their workforce as a strategic advantage, competition for the best talents grows steadily and leads to a ‘war for talent’. Due to the fact that these developments can be recognised all around the world the resource ‘human being’ becomes incrementally essential. So, companies begin to look for potential specialists and executives not only on national but also on international labour markets. Besides investments in trainings, the further education of older employees and the cooperation with schools or universities, the creation of a strong employer brand may be important.

Speaking of buyer’s markets employees decide for their individual employer-of- choice. For this purpose, they of course have to know the company and be convinced of the benefits working for it. Thus, to successfully attract and retain the best talent, marketing, brand management and especially a powerful employer brand may be imperative instruments for a company. The creation of a distinctive image and a credible, trustworthy and responsible reputation should then be a company’s primary concern. In times, where internet makes information accessible and transparent a consistent outward presentation is inevitable. Furthermore, as a generational change takes place, employer branding may also be an important tool to consider those divertive generational values.

With the objective of surviving the war for talent employer branding gained influence over the last years. Furthermore, as this war even goes global, companies may also have to think about an employer brand management that successfully operates on international labour markets.

This paper pursues the thesis that employer branding is a necessary and beneficial instrument for companies to stay competitive. Furthermore, it argues that, as the competition for talented workforce becomes a worldwide issue, a strong global employer brand attracts and retains high potentials. Thus, it has a distinct impact in the war for talent.

Methodology:

This thesis discusses the significance of employer branding for a company’s economic success based on theoretical information and various surveys. To improve the contextual understanding basically important terms concerning employer branding are defined at the beginning. Subsequently, rationales for the necessity of an employer brand are argued. For this purpose, this chapter deals with possible reasons including the war for talent and the generational change. Moreover, the following part highlights the main targets and benefits of employer branding for both, the company in becoming an employer-of-choice and the employees profiting from and identifying with the brand values. Assuming that employer branding refers to Human Resources marketing and is integrated in the brand management of the company, linkages to product branding, the impact of brand equity and the importance of corporate branding are discussed under the next point. Corporate reputation, corporate identity, corporate image and communication are important keywords respectively. However, to attract highly qualified workforce, companies have to be exceedingly attractive to them. Employee value propositions, as considered in the following chapter, evoke and improve this attractiveness and may create a preference as employer-of-choice. Before summing up the relevance of global employer branding in the war for talent, the situation on international labour markets, the need for a global employer brand as well as the company’s challenges and benefits in this regard, are illustrated.

Table of Contents:

Text Sample:

Chapter 6, Employee Value Proposition:

Before, the importance of a coincidence of the values communicated inwards and the externally promised brand values were frequently emphasised.

The internet allows customers to compare prices and products, which intensifies the competition. And today, also employees can instantly search the web to discover their value and other job opportunities. So, employees also weigh the price they pay against what they are being offered. Accordingly a shift in the balance of power from employers towards employees is observed. Therefore employers have to offer a unique value proposition for them.

According to Axelrod, Handfield-Jones & Michaels ‘an Employee Value Proposition is the […] sum of everything people experience and receive while they are a part of a company – everything from the intrinsic satisfaction of the work to the environment, leadership, colleagues, compensation and more. It’s about how well the company fulfils people’s needs, their expectations and even their dreams’. By a value proposition the company distinguishes itself from its competitors. Therefore, Trost defines it as the core of the employer brand. To create an overwhelming EVP, companies must provide elements high potentials are looking for: e.g. an exciting work, a great company, an attractive compensation, and opportunities to develop.

Work for instance must be interesting, challenging or even socially important. This may be the case for companies that are more innovative, launch more new products or have a more inspiring mission than its competitors. The company as a valuable factor encompasses everything about the firm: reputation, values, culture and inspiring leaders. Employees might be willing to work longer hours or for less compensation for a company with stronger corporate values or a better reputation. For employees it is evident that poor leadership not only impacts on the success of the company but also the quality of the work environment and possibly even on their own ability to develop and build a career. A value proposition that offers employee rewards implicates both, wages and benefits but also intangibles such as career prospects, development opportunities, work – life balance and social contact with co-workers.

To look once again at the generations mentioned in chapter 3.2, those rewards are on the one hand valuable factors for the members of the actually attractive generation Y. Important for them are their development potentialities and higher wages or flexibility. But on the other hand, an exciting work and a strong corporate identity and image are of immense value to stay in the company, even in bad times.

However, the fact that employer branding must fit with the business strategy and should be integrated into corporate branding, requires a cooperation of the HR Department, the Marketing Department and the Senior Management. Because the corporate brand as well as the employer and product brand target a huge amount of different stakeholders it is necessary to analyse all external and internal brand propositions realistically and filter out core propositions. Due to generational changes and the different expectations of high potentials, the company has to balance an overall positioning of the employer brand against distinctive EVPs for different types of employees. To evaluate employees’ perceptions and expectations of an employer-of-choice, market research is an inevitable instrument.

So, an effective EVP can be used as a persuasive tool for attracting and retaining high potentials. Measuring the company’s value propositions for employees is a concrete way to become an employer-of-choice and to succeed as a business.

Having considered only a national employer brand so far, it is consequential to elaborate the impact of global employer branding on the company’s success. Therefore, the following chapter concentrates on the relevance as well as the possible benefits and challenges of international branding.