Employee Value Proposition (EVP) is a term used to describe the benefits and qualities of working for a company.
EVP is a term used to describe a combination of company characteristics, benefits, and styles. It is the agreement reached between an employer and an employee in exchange for the employee's contribution and performance. This "deal" defines an employer and sets it apart from the competition.
When it comes to their EVP, most companies face two major issues:
- They find it difficult to set themselves out from the competitors. If a company wants to shine in the "sea of similarity" that exists in other industries, segregation is essential.
- Their branding is attractive, but it does not adequately reflect reality.
A successful EVP not only allows the company to stand out as unique but also ensures that the 'package' is similar to 'content.' Often, people are enticed into a movement by 'making a mark,' and then they are disappointed when they see the truth.
When you do well, your company becomes a magnet for talent, with people who are involved and motivated.
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What is the Importance of EVP?
An effective EVP can provide tremendous benefits to a company. According to data conducted by the Corporate Leadership Council, a well-planned and performed EVP can:
- Increase new hire commitment by up to 29%.
- Cut compensation premiums for new hires by up to 50%.
- Increase the possibility of employees participating as advocates from 24% to 47%.
Furthermore, an effective EVP enables organizations to source further into the labor market, expanding their access to passive candidates. This is critical for companies looking to secure the top employees in an increasingly competitive industry. Demographic projections reveal that population growth will be very different in different parts of the world. Many countries will see population declines, making it more difficult to find talent, but India will see massive population increases, making it more difficult to find the proper talent from a potentially large pool. This will present issues for organizations in the future, further emphasizing the need for having a competent Employee Value Proposition.
What can an EVP help you with?
The following are the specific advantages of an Employee Value Proposition (EVP):
1. Assists you in attracting and retaining talent.
With a clear and distinct EVP, you may attract and keep people who would otherwise be attracted to other organizations with more appealing EVPs.
2. Aids you to appeal to a variety of markets and difficult-to-hire skill groupings.
For organizations that operate across many nations, the EVP will need to evolve beyond a one-size-fits-all approach. A good EVP includes features that appeal to employees from many cultures, age groups, and job types. The most successful EVPs are created by merging the demands of important workforce segments to create a global brand, which is then communicated via the most appropriate channel for each segment.
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3. Assists you in re-engaging a disgruntled workforce.
The process of developing an EVP entails conducting surveys and speaking with current staff. This is an extremely effective engagement strategy in and of itself, and most people enjoy and appreciate it. The method, in our experience, can also serve to re-build/enhance trust and motivate people.
4. Assists you in setting priorities for your HR agenda
The process of obtaining your EVP will help you determine your HR priorities. To establish an EVP, you must first determine what is important to your current and potential employees. With this knowledge, you'll know exactly what you need to do to attract, engage, and keep the people you want, where changes are needed, and what will most likely cause individuals to leave if not handled.
5. Establishes a powerful 'people' brand
Organizations with strong and credible EVPs become known as much for how they treat their employees and the quality of their workforce as for their products and services. Apple is a wonderful illustration of this. Apple does not need to compete for talent. They had a long line of individuals waiting to join them.
6. Reduce the cost of new hires.
Candidates who find an organization's EVP appealing want a lower wage premium when accepting a job offer. According to the Corporate Leadership Council, hiring employees with ugly EVPs costs 21% more than hiring individuals with appealing EVPs costs only 11% more.
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What characteristics distinguish an excellent EVP?
To get the most out of an EVP, it needs to be constructed around characteristics that genuinely attract, engage, and keep the talent you desire. It also needs to be in line with strategic goals and demonstrate its distinctiveness. The Employee Value Proposition (EVP) must also be authentic, meaning that a significant component of it must be accurate right now. It should, however, include characteristics that are not true now but that the organization aspires to be true in the future. This is critical for driving change and progress, as well as giving employees the impression that the organization is responding to the improvements they desire.
The EVP's 'content' must also be articulated in a manner that is appealing to the audience. So many businesses describe themselves in drab corporate jargon that the end consequence is a plethora of businesses that profess to be unique but sound the same.
Finally, all other organizational procedures revolve around the EVP. The EVP's features must be reflected in both the corporate and employer branding. If properly implemented, the EVP is a driver of engagement, informing recruitment messages, communications, and development, as well as strategic HR initiatives. It assists in the support and development of business strategies.
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How do you put together an EVP?
There are several methods for determining what your employees consider to be a wonderful place to work. A smart place to start is to use data you currently have, such as employee opinion survey data. This will reveal what employees believe is working and what they believe is not. Typically, though, such surveys do not reveal what is most important to your audience. It is evident that understanding this is critical in order to produce an appealing Employee Value Proposition (EVP). The process of creating an EVP uncovers what matters to the various types of individuals you want to attract and engage.
To be successful, the EVP must be trustworthy, which is why it must be tested on a regular basis. The goal of testing is to guarantee that it appeals to all types of employees and future employees. The testing also reveals which aspects of the EVP should be 'cranked up' or 'cranked down' to appeal to various demographics. Internal employees and external potential employees should both be tested.
The testing will show which improvements to make to the EVP in order for it to appeal to the various audiences with whom it was tested. If valid and rigorous data is used to construct the EVP, 90% of the target population should be able to use it. It should be tested on a regular basis, as the 10% that has to be changed could represent a critical part of your workforce.
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For a large pharmaceutical firm, there is an Employee Value Proposition (EVP). Their objectives were to:
- Differentiate themselves from other large pharmaceutical companies.
- Use the EVP to assist in the implementation of the new corporate identity.
- Identify priority areas for improvement in order to keep and improve important talent engagement.
There have been a number of additional important outputs in addition to the EVP. An online user guide for HR and managers offers tips on how to manage and engage several critical groups. A recruiter's guide to employer branding identifies the messaging content and style that appeals to various demographics. Furthermore, the data is being used to inform HR strategic initiatives.
This is an excellent example of a company that has developed a distinct and distinct EVP and is putting it to work in a very practical and tangible way.
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