According to the Australian Bureau of Statistics, our unemployment rate plummeted to 3.5% in June 2022.
This is the lowest unemployment rate we have had in 48 years!
We know that in an increasingly tight labour market, organisations need to be careful to not lose good employees, while remaining capable of attracting the right people.
Yet many organisations are continuing with the same reactive people practices that are out of place in our dynamic and uncertain work environment.
With a tight skills and talent market, doing things differently is critical. An Employee Value Proposition (EVP) is now more important than ever.
At its core your EVP can be an important reason why your present employees enjoy staying and why talented people will be attracted to work for your organisation. Hence, one key aspect which is very worthwhile is in revisiting your EVP.
What is an Employee Value Proposition?
EVP describes why your organisation exists, how the work is done, the experience they can expect to gain, and finally, the outcome that might be expected.
Fundamentally, your EVP defines who you are as an employer and what it is an an organisation that you are offering present and/or future employees.
How can an EVP benefit your organisation?
Leadership teams will have a clearer understanding of how their organisation is attracting people, what is sought from the organisation, together with the broader offering being made in return for every person’s time, expertise and effort.
What can be achieved by having a good EVP?
There are numerous potential benefits that can be gained from a good EVP, and those benefits include:
- Improving staff well-being
- Strengthening of talent retention
- Decreasing and stabilising of turnover rates
- Attracting the better quality talent/key staff
- Reducing of time taken in attracting talent/key staff
- Increasing of the potential talent pool availability
- Strengthening of organisational culture
- Increasing team performances
- Increasing overall organisational performance
- Improving of employee engagement.
What if you are yet to finalise your EVP?
There are a number of approaches you could explore, and the following might prove useful to keep in mind.
Firstly, a good starting point is to identify what you consider is your competitive advantage. This could involve asking present employees their thoughts about what they consider is special about working in this organisation, it may be followed up with what might seem a confronting question, but nevertheless a key insight – “Why do you stay working with XYZ?”.
Secondly, you may even wish to broaden your gathering of insights and feedback. This will naturally depend on what timeframe you have to undertake this work, as well as the resources available to commit to ensuring this important exercise can be properly carried out.
Some organisations will conduct surveys, run focus groups, and even do individual interviews with specifically identified stakeholders. Fundamentally it is all about what people are seeing is important to them about the organisation. in other words, what is it that ‘grabs’ them and wants them to stay.
While there is the upfront work to establish these aspects it doesn’t mean that that is the end of it. There will be benefit in asking any people who are applicants for vacancies what attracted them to the vacant role. Just as you are looking to those coming onboard, equally there is value in really understanding what might be missing, that meant a person leaving your organisation.
Some commentators suggest asking a person who is leaving – ‘what would it take to retain you?’.
Addressing key elements that generate personal benefits
Ultimately all of this will feed into having a better insight into your organisation’ key benefits as perceived by others. From an EVP perspective you are assessing the strength across quite varied but often inter-related elements such as:
- Organisational purpose
- Career opportunities
- Work/life balance
- Hybrid working
- Upskilling pathways
- Organisation and/or team culture
- Alignment of individual goals
- Compensation – salary
- Compensation package – rewards & benefits
- Leadership quality
- Means and support structures in place
- Presence of engagement
- Overall work environment
- Sense of social cohesion/networking
Employee retention strategies
Now with your EVP in hand you are in a position to address the organisation’s employee retention approach.
EVP is a central factor for successful employee attraction as well as employee retention. Research and anecdotal feedback strongly indicates that those employees who are aligned to an organisation’s values, will stay. Of course, this is not the only value as other benefits will be observed, including maintaining of a low rate of employee turnover.
Review and transform your compensation program
Recapping, we know that employee expectations are changing. The bottom line now is every organisation needs to have a competitive total compensation/rewards program.
In our previous article, we covered the importance of remaining abreast of the latest comprehensive pay and talent trends. For example:
- Do you fully understand how the talent market is moving in your sector?
- How do your competitors pay people in similar roles?
- What are the various measures we need to identify and consider as part of a valuable performance recognition, and incentives program?
Relying just on traditional practices and old data around the annual compensation review is no longer enough.
To be future ready, a more holistic approach is required whereby an expanded pool of compensation and benefits data is easily accessible. With increasing cross-industry skills occurrence especially, your remuneration data should include all industries as well as non-traditional peers and markets.
Compensation must be part of a solution that drives retention
With ‘burnout’ among employees soaring to unprecedented levels, mental health struggles in the workforce are putting quality of work under huge strain.
According to the research findings published by the global HR firm of ADP in “People at Work 2022: A Global Workforce View”, the following have emerged as significant issues to be addressed:
- “Mental health: Stress is increasing, and work is suffering, with 7 out of 10 Australians surveyed saying stress is prevalent.
- Workers want change: People generally are now looking beyond just their salary and financial benefits. They are re-evaluating the importance of job security and business ethics as part of who they are and how they wish to live their lives.”
It is now crucial that organisations disrupt traditional thinking and take a more proactive and purposeful approach to understanding the factors impacting their employee retention strategy. For example:
- What support program do you offer employees to achieve their career objectives, develop and grow?
- What opportunities do you provide for them to learn new skills, and will their performance be evaluated accordingly?
By putting time into ensuring there is emphasis on compensation as well as other key elements – purpose, continuous support, innovation, and learning, you are demonstrating a deliberate willingness to consider aspects of your EVP in a holistic manner.
A new approach of doing things
Continuous disruptions are upon us. It is time to review and transform reactive practices that have been in place for decades. They served us well in the past.
But the future calls for a different response. Committing to build a more agile and future-ready organisation, demands a new approach to looking at your compensation strategy as a part of your EVP and making it a key differentiator with positive impact.
Our flexible approach includes Board member and staff interviews, diagnostic insights, and reporting, and conducting facilitation sessions with your key people to agree meaningful and practical actions that deliver high positive organisational impact.
Contact us today to discuss how we may be able to assist you.