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Aug 10, 2017

Just as the customer has expectations around a firm’s brand, so does an employee. While the Customer Value Proposition defines the value of a firm’s products or services to the consumer, the Employee Value Proposition (EVP) is the value — tangible, intangible, and reputational — that an employee receives from an organization in exchange for his or her work.

When we work with organizations on their employee engagement initiatives, we often conduct what we refer to as “engagement summits.” During these summits, we review the results of the company’s employee engagement surveys, discuss recommendations for improvement, and develop action plans. One of the key components of these summits is to discuss the organization’s EVP.

We start by asking organizational leaders, “Why would someone choose to work for you?” All but the most in-touch organizations come back with responses like, “We pay above market,” “We were just voted an employer of choice,” “We have a recognizable name,” or simply, “Because we have a lot of open positions.” Others simply look at each other, laugh uncomfortably, and say “Uhhh…we don’t really know.” Either way, few are able to describe their EVP in any level of detail.

Two companies that know their EVP

We recently worked with two restaurant companies, one a 400-location fast food chain and the other a 150-location upscale chain. The fast food employees, as we learned through surveys and focus groups, found the greatest value in flexible schedules (which allowed them to meet family, school, and social obligations), the ability to associate with friends while on the job, and getting 50% off of once-per-week lunches (a perk that cost about 78 cents per week per employee).

The upscale restaurant workers, in contrast, were engaged by completely different factors: opportunities for growth, development, and advancement; the trust of their managers; community support; and satisfied customers.

The leaders at the fast food chain, understanding their EVP, also understood that most of their workers were young and mobile-device savvy. In order to facilitate scheduling (one of the key drivers of their value proposition), they went to an app-based scheduling system their employees could access from home. They implemented a recruiting referral program that paid employees $100 per referral hired, solving the recruiting problem by bringing networks of friends and family together in the same locations. They expanded their discounted food program to include one meal per four-hour shift. Employee engagement and retention increased significantly.

The upscale food chain also looked at its EVP and discovered that the value proposition varied across job descriptions. For example, a large percentage of the chain’s servers (who made up a significant portion of the population) fit into one of two categories: students and single parents. For them, a flexible schedule with sufficient working hours to pay the bills was extremely important. The restaurants accommodated. Restaurant managers and assistant managers, however, valued the opportunity for career development, training, and advancement. For the latter group, they put in place a comprehensive manager training program, which greatly reduced attrition.

Here’s how to know your EVP

Most organizations don’t take the time to review their EVP in detail. Understanding your EVP starts with asking the following questions, but doesn’t end there. We find that many organizations think they know the answers to these questions. However, we also find that many times employees respond differently. This misalignment results in ineffective hiring, disengagement, and attrition.

Do you know your EVP? Start by answering the following four questions (and their corresponding outcome questions). Then, compare your answers with those of your employees to see if you are aligned:

  1. What is our organization’s “brand” (what you are known for by current and potential employees)? What outcomes do you experience because of that brand, and are those the outcomes you want?
  2. Why would someone choose to join your organization (what is the value you propose to future employees)? What would it take to attract that person?
  3. Why would an employee choose to stay at your organization? What would it take to keep that person?
  4. Are there any gaps between what appeals to your employees and what they experience? What would it take to close those gaps?

EVP doesn’t just apply to the organization as a whole. Each company, function, department, plant, and even manager has its own brand. Do you know your EVP?

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