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Employer Branding

A common question in today’s market is “How can I hire the right people when I need them in such a competitive market?” While some organizations have household name recognition or limitless compensation resources, most of us have limited market presence and resources.  This does not mean we are not great places to work or fail to offer a superior work environment or opportunities, it is just we are not known to potential candidates.  In order to counteract the “hidden gem” problem, a growing number of organizations are turning to employer branding.

What is employer branding? In the simplest sense, it is the application of the marketing concepts and tools utilized to gain customers to attract and hire potential employees.  An employer’s brand is the perception that current, past, and potential employees have regarding what it is like to work for your organization.  These perceptions include most major elements of the workplace experience, including culture, work environment, management style, opportunities, and rewards.  Just like with many major products or brands, certain words, phrases, or descriptions will correspond with each employer and the associated workplace.  Moreover, when combining perceptions, a hierarchy develops that current as well as potential employees rank employers. 

While all employers have a brand by design or not, it requires serious and continuous commitment to have a successful brand that attracts and secures the most desirable candidates. A successful branding process typically includes:

  • becoming familiar with the characteristics of your organization;
  • assessing the characteristics and needs of your potential candidates;
  • gaining insight into the brand and approach utilized by your competitors;
  • defining your value proposition or what makes your organization superior to your competitors; and
  • developing and executing your brand and branding strategy.

Your Organization

A first step to launching as well as maintaining your organization’s brand is to conduct a comprehensive and open assessment of what is positive and negative about your organization.  Very few, if any organizations will only have positive traits, so it is important to have a realistic image of the traits present within your organization.

Potential Candidates

If your organization subscribes to the idea that potential employees would be lucky to work here, many strong candidates will opt to look elsewhere.  In the current labor market, organizations have to be selling their workplace and not expecting high quality hires to focus on sell themselves.  Consequently, it is important that employers have a good understanding of the preferences, needs, and interests of the high quality candidates that they are interested in recruiting,

Competitors

Since most employers do not have the luxury of being the sole, desired employer, it is critical to understand what your competition is offering and how you can demonstrate your competitive advantage compared to opportunities in their workplace.

Value Proposition

Based on the strengths of your organization and knowledge of your competitor’s practices, what you offer potential employees that differentiates your organization should be defined and the associated communication materials developed.

Strategy

Defining your competitive advantage provides the basis for your brand, but your strategy puts your brand into practice.   In the most successful organizations, the brand strategy impacts potential candidates as well as current and past employees.

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The 3 Q’s of Recruitment

We are fortunate to have a special post from a guest writer.

C. Darren Brooks, Ph.D. has spent almost 20 years as an HR practitioner and performance consultant in the private and public sectors. He has extensive experience in strategic HR planning, recruiting and staffing, instructional design, performance improvement, program evaluation, organizational development, and talent management. Dr. Brooks is a visiting/adjunct instructor at Florida State University in the College of Business and College of Education.

Over the weekend, while watching a pre-season football game with my son, I was intrigued by the numerous discussions about player trades and acquisitions during the off-season and the attention teams give to identifying the player(s) that fit their particular organizational need. In other words, there is better alignment between the organization’s need and the actions taken to meet that need. This takes planning and an understanding of the priorities driving the recruitment process.  As I contemplated the level of detail football coaches and team personnel managers place on the recruitment strategy, I could not help but reflect on whether or not business and governmental organizations applied the same level of thoughtfulness in aligning their human resource needs with their recruitment planning. My experience gave me the answer…no!

In most organizations, recruitment planning typically means managers are engaged in “filling a position” with limited thought given to aligning need and activity. More specifically, many hiring managers lack clarity about key priorities that are necessary to define a recruitment strategy. For example, if a manager is pushing to fill a position quickly yet the organization needs to improve the quality of new hires there is a lack of alignment between the need and the recruitment activity. When this happens the result is rather predictable. The position is filled but need is not met.

As HR and recruiting professionals it is our responsibility to assist hiring managers in identifying and aligning the business drivers of the recruitment process.  This can be done by engaging your hiring manager in a discussion about what I call the 3 Q’s: Quantity, Quickness, and Quality. While not a comprehensive list of questions, answers to the 3 Q’s provides answers that will shape the actions of your organization’s recruitment strategy. Let’s discuss each one briefly.

Quantity. How many qualified candidates are needed? The answer to this question provides detail that will shape how you will market the position, how you will evaluate candidates during the recruitment process, and the impact on the hiring manager’s time. For example, I recently advised a client who needed to hire more than 120 entry level professional positions in 8-weeks. The number of new employees necessary to meet the organization’s need required the employment of a broad mass-marketing approach to attract the volume of applicants in a short period of time. One potential downside is quality may suffer resulting in higher rates of turnover down the road.

Quickness. It is important that you understand the hiring managers definition of quickness in recruitment activity. This ensures that there is realism in the recruitment process. If quickness is the key driver, a different recruitment strategy may be necessary because an extensive search may not be possible.

Quality. In recruiting speak, quality generally refers to the strength and caliber of a candidate’s experience and overall qualifications when compared to the requirements for the position. During the discussion with your hiring manager, clarify what is meant by quality. Have them describe the requirements necessary to perform in the job. Ask for the top three to five “must haves” in a candidate. This will help the hiring manager think through the position in context of the organization’s need. You can also help them recognize what is “important criteria” versus what is a “nice to have”.

By taking the time to question hiring managers about the 3 Q’s, the better you will understand the key business drivers that ultimately shape your organization’s recruitment strategy. By seeking clarification and prioritizing quantity, quickness, and quality your recruitment efforts will be more productive and aligned with the needs of the organization.

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Recruiting: How to Approach It

Like many human resource processes, preparation will increase the chance of recruitment success.  We discussed the tangible and intangible investment that is made when we add a new team member in the last post and clearly the cost of recruiting is sizable.  Given the commitment of resources necessary to add a new team member, it is not hard to recognize that a small investment on the front end of the process makes a lot of sense.  There are five critical decision areas that need to be addressed as part of the planning process:

  • Analyze the job
  • Update job description
  • Determine candidate characteristics
  • Assign a pay level
  • Devise communication methods

Analyze the Job

Before starting the recruitment process, it is important to assess how the job might have changed since the last time the job description was updated or the last person was hired in that classification.  Potential changes include tasks and responsibilities, workflow, new technologies, or flexible arrangements.  Leaders in the organization, the immediate supervisor, and even coworkers should be involved in this updating process to ensure that the most important up-to-date information is available for updating the job description.

Update Job Description

Every job in an organization should have a detailed job description that covers overall purpose, individual tasks and responsibilities, and required background or experience.  The description should indicate the relationship of the job to the organization and team, most critical skills, and most important tasks.  Before advertising, the job description should be updated and approved so that it can be made available to screeners, interviewing staff, and candidates.

Determine Candidate Characteristics

As we all have experienced, a candidate can have all the necessary skills and abilities and not possess the “right fit” for the organization.  As part of the planning process, the personal characteristics of the ideal candidate should be identified: experiences, competencies, education, training, specific skills, knowledge, and aptitudes.  In addition, behavioral and personality characteristics should be considered.  The behavioral characteristics should be linked to the organization’s culture as well as the team.

Assign a Pay Level

Market supply and demand, current internal pay levels, and the ability of the organization to pay should be factored into the pay range calculation.  Although it is tempting to assume that all candidates can be compensated the same, it is important to have a compensation philosophy that allows your organization to be responsive to the market and type of candidate you desire.

Devise Communication Methods

When leaders fail to attract the kind of applicants they desire, two of the most common causes are a lack of communication related to the opportunity and miscommunication of requirements and expectations.  The lack of communication is related to not distributing information on the opportunity to the right outlets commonly viewed by the desired candidate type.  Miscommunication occurs when the opportunity is not described in a manner that the desired candidate type desires to pursue the position due to a lack of details, misspecification, or failure to use the correct occupational language.

All five factors should be considered before beginning the hiring process.  Some research has shown that an organization’s success rate can improve by as much as 40 percent if these guidelines are followed.

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Recruiting by the Numbers

As we discussed recruiting in the last two posts, a few readers posed questions over the average cost for hiring someone new.  As human resource professionals or managers we regularly make the comment that it is very costly to lose and replace people.  Although most of us believe this, rarely do we know the exact combination of time and money that it takes to recruit, select, and on-board someone new.  According to the Employment Policy Foundation, a Washington, D.C.-based research group, average turnover costs reached $13,355 per full-time private-sector worker in 2004.  More recent studies have found that 25 percent of the current employees pay is a good low end predictor for lower level positions. As would be expected, professional positions possess a higher replacement cost at approximately 150 percent of current salary.  Finally, executives can reach as high as 2000 percent of annual salary.  The variation is due to the differences in the cost of recruiting, selecting, training, and lost productivity at each level of the organization.

Figure 1: Tangible Recruitment Cost, 2010

Figure 1 is based on 2010 SHRM data and captures the median cost of the average hire in all industries, private sector, and public sector.  These numbers focus on the tangible cost of recruiting and hiring: advertising, any agency fees, travel for interviewing, relocation, and recruiter fees.  As an organization grows in size, the cost of hiring increases due to the need for dedicated staff, larger geographical searches, and use of more sophisticated tools and technologies.  The public sector has a much steeper increase in costs in organizations of 500 employees or more and then plateaus in organizations of a 1,000 employees more.   The private cost exceeds the public in large organizations and continues to grow.  The median cost in large organizations is approximately $3,500 per hire.

Figure 2: Tangible and Intangible Recruitment Cost, 2010

Figure 2 combines the tangible and intangible costs per hire based on HCS data from 2010.  The primary intangible costs include the lost productivity from the recruiting staff and the time it takes for the new employee to reach full productivity.  The progression is fairly regular across all groups.  The private sector results are slightly higher due to higher pay levels.

The major things to keep in mind are:

  • It is costly replace employees;
  • Tangible costs are approximately $3,500 per hire;
  • Total costs per hire is approximately $30,000 for the average employee; and
  • Costs increase as the level of the position increases.

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Do Not Make Me Hire

We all know that hiring someone possesses a certain amount of risk.  At a minimum, most of us worry about the depth of the candidate’s abilities, the candidate’s ability to fit in with the rest of the team and the organization as a whole, and the probability that the candidate will remain with the organization and consistently produce at the level needed.  Each of these in turn relate to a rather large, latent concern of what if the candidate fails to be everything hoped for, will he or she have to be let go at some point in the future.  Consequently, it is common for the typical decision maker to oscillate between the excitement of increasing the team’s abilities and the fear of making a mistake.

Several past clients have likened the hiring process to trying to select the least negative outcome.  One leader described hiring as “I know that it will turn out bad eventually, but I want to minimize how bad it will be.” Another characterized the process as “I know what I want and cannot afford, so I just hope to get someone that has most of what I want.”  A more recent one made the point “people will say anything to get a job, so I really have to be an investigator.” When I asked the same leaders what were the real issues, three things generated the greatest concerns:

  • Cumbersome nature of the hiring process
  • Lack of good candidates
  • Poor results of those hired

Cumbersome Nature of Hiring Process

One of the biggest concerns of managers is the time and effort it takes to hire a new employee.  Hiring like other functions suffers from the “not broken, do not fix” perception.  It is easy to assume if people are being hired, then the process must be working.  However, research has shown that there is considerable variation in the hiring process and the associated costs and efficiencies.  Although some elements of the process are necessary, many times streamlining can preserve the integrity of the process while increasing efficiency.

Lack of Good Candidates

Even in an economic downturn, it is not always easy to find strong candidates.  Some of the major reasons include the reputation of the employer, labor market availability, and reaching the most desired segment of the market.  In the last few years, numerous clients have indicated that there are many more applications, but the number of strong candidates has stayed the same or even decreased.  Typically, a downturn serves as a mechanism for reducing the weakest segments of an organization’s workforce.

Poor Results of Those Hired

The final concern is closely related to “buyer’s remorse” or the fear that I will select the wrong option and be disappointed.  As leaders, we work with imperfect information in an imperfect world.  Mistakes are the nature of being human.  Consequently, it is important to reduce the number of less than optimal hires to the best of our ability.

Obviously, in every organization people are the greatest asset and attracting and retaining the best people are critical to success.  Going into the hiring process with dread is not the ideal.  In the next few posts, we will explore what you can do to reduce worry and maximize your desired results.