Taking Control of EVP

Copyright © 2008. Korn/Ferry International and Korn/Ferry International Futurestep, Inc. All Rights Reserved.

Agenda

 Employment Value Proposition (EVP)  Defined  A Methodology

 (tools/templates)  (inputs/data gathering/analysis)

 Aligning the EVP to Talent Management processes  Competitive Advantage (attraction)  Candidate Experience (evaluation)  Employee Engagement (retention)

 Advantages of Employing an EVP Strategy  For the candidate/employee

 For the employer

 Case in Point: Volkswagen Group of America

 Conclusion


Employment Value Proposition Defined


The Employment Value Proposition – a Methodology

The EVP is comprised of five key categories: – Organization (stability, success) – People (quality of managers, collegial environment) – Rewards (compensation, recognition) – Opportunity (developmental and advancement) – Work (work/life balance, engagement)

How do employees, candidates, and other stakeholders rank these attributes in order of importance?

How do they perceive your ability to deliver a quality experience in each of these categories?

How is your competition and the industry doing?


Employment Value Proposition Attributes

Work

• Work Life Balance • Job Interests Alignment • Location • Recognition • Innovative • Level of Impact • Business Travel

Rewards

• Compensation • Health Benefits • Retirement Benefits • Vacation

People

• Co-Worker Quality • People Management • Collegial Work Environment • Manager Quality • Sr. Leader Reputation • Camaraderie

Opportunity

• Stability • Future Career Opportunity • Developmental Opportunity • Meritocracy • Growth Rate

Organization • Respect • Ethics/Integrity • Empowerment • Product/Service Quality • Technology Level • Diversity • Market Position • Formal/Informal Work Environment • Brand Awareness • Social Responsibility • Industry Desirability • “Great Employer” Recognition • Customer Prestige • Environmental Responsibility • Organization Size • Risk Taking


Employment Value Proposition Attributes Defined

WORK Work Life Balance The extent to which the job allows you to balance your

work and your other interests Job Interests Alignment Whether the job responsibilities match your interests Location The location of the jobs the organization offers Recognition The amount of recognition provided to employees by the

organization Innovative Work The opportunity provided by the job to work on

innovative, "leading edge" projects Level of Impact The level of impact the job has on outcomes Business Travel The amount of out-of-town business travel required by

the job REWARDS

Compensation The competitiveness of the job's financial package Health Benefits The comprehensiveness of the organization's health

benefits Retirement Benefits The comprehensiveness of the organization's retirement

benefits Vacation The amount of holiday/vacation time that employees

earn annually PEOPLE

Manager Quality The quality of the organization's managers Coworker Quality The quality of the coworkers in the organization People Management The organization's reputation for managing people Collegial Work Environment Whether the work environment is team-oriented and

collaborative Sr. Leadership Reputation The quality of the organization's senior leadership Camaraderie Whether working for the organization provides

opportunities to socialize with other employees

ORGANIZATION Respect The degree of respect that the organization shows

employees Ethics/Integrity The organization's commitment to ethics and integrity Empowerment The level of involvement employees have in decisions

that affect their job and career Product/Service Quality The organization's product or service quality reputation Technology Level The extent to which the organization invests in modern

technology and equipment Diversity The organization's level of commitment to hiring a

diverse workforce Market Position The competitive position the organization holds in its

market(s) Formal/Informal Work Environment Whether the work environment is formal or informal Brand Awareness The level of awareness in the marketplace for the

organization's brand(s) Social Responsibility

The organization's level of commitment to social responsibility (e.g., community service, philanthropy, etc.)

Industry Desirability The desirability of the organization's industry to the respondent

"Great Employer" Recognition

Whether or not the organization's reputation as an employer has been recognized by a third party organization

Customer Prestige The reputation of the clients and customers served in performing the job

Environmental Responsibility The organization's level of commitment to environmental

health and sustainability Organization Size The size of the organization's workforce Risk Taking The amount of risk that the organization encourages

employees to take OPPORTUNITY

Stability The level of stability of the organization and the job Future Career Opportunity The future career opportunities provided by the

organization Development Opportunity The developmental/educational opportunities provided

by the job and organization Meritocracy Whether or not the employees are rewarded and

promoted based on their achievements Growth Rate The growth rate of the organization's business


Typical inputs to the Employment Value Proposition


Aligning the EVP to Talent Management Processes

Although the most common benefits cited in Employer Branding research are enhanced recruitment and retention as well as increased engagement/commitment, Employment Branding applies to all facets of talent management.

Workforce Planning: Getting the right people in the right place at the right time Outreach: Recruitment marketing efforts to generate awareness about the company Sourcing: Strategies to attract targeted talent for organizational fit Selection: Evaluating talent for organizational fit Onboarding: Orienting new hires to the company/culture Retention: Increasing employee satisfaction and reducing turnover

With a focused brand strategy, organizations can realize a positive impact across all talent management operations.


Components of an EVP

Competitive Advantage Marketing the message: A well defined EVP identifies the competitive differentiators based on the preferences of critical talent and the core attributes based on their perceptions. The combination of that study spells out the competitive advantage to include in the employment branding messages

Candidate Experience The Evaluation process: Candidates are evaluating the company as much as the company is evaluating them through the hiring process. Educating the recruitment teams and hiring managers on the EVP study results allows them to evaluate and sell candidates on realistic aspects of the culture that ensure a good organizational fit

Employee Experience The Retention factor: An EVP study helps to understand what is most important to critical talent. Therefore where HR investment dollars should be prioritized and spent


The Pathway to Competitive Advantage

Preference: The employment related attributes most ‘preferred’ by your employees.

Perception: How your employee population ‘perceives’ your company is performing against the most preferred attributes.

Core Attributes: Those attributes which are both highly preferred and perceived as strengths in a company.

Competitive Advantage: Core Attributes which differ from industry norms.


A Positive Employee Experience

Tools & Processes: Once the desired EVP is identified & understood, it can be incorporated into the recruiting evaluation tools such as; screening forms, interview questionnaires, debrief meetings.

Training: The competitive advantage messages should be communicated throughout the organization to ensure a consistent message to candidates throughout the evaluation process.

Ensuring Organizational Fit: Candidates receiving consistent messages make better decisions in the long-run. Ensuring a better fit and increased retention.


Re-engaging your Employees

Understanding Perception: The attributes most ‘preferred’ by your employees could change over time.

Reviewing Programs: How your employee population ‘perceives’ your company is typically very closely aligned with the EVP. As the EVP changes, ensure the programs are in alignment

Quantitative Reviews Are Not Enough: In addition to performing the quantitative analysis, use focus groups to ask questions and solicit competitive intelligence from your employees


Advantages of Employing an EVP Strategy

The Advantages of an EVP strategy are enjoyed by both the Company and the

Employees


For the Employee: Functional and Emotional Benefits

Functional benefits of Employment Brand

– Hourly wages or salary

– Work environment – Equipment needed to perform

Emotional Benefits of an Employment Brand

– Value from total work experience

– Satisfaction with work performed – Feeling valued by colleagues

– Belief in quality, purpose and mission of organization

These important elements to the Employment Brand can sometimes be taken for granted


For the Company: Lower Costs

Towers Perrin study in 2003, over 35,000 employers found a clear correlation between employee engagement and cost of goods sold

AON study in 2000 found that the cost to replace an employee is equal to ½ their annual salary

The Conference Board estimates the cost to replace middle manager is as high as 1.5 times annual salary

Hewitt study found that companies in Fortune’s 100 best companies to work for had average turnover 50% lower than other companies resulting in significantly reduced recruiting costs


For the Company: Customer Satisfaction


Developing Brand Insights

Companies spend 10 times more on company research than employee research

It is important to gather quantitative and qualitative data on employee perceptions to identify and understand your Employment Brand Reality (EVP)

With the advent of the many survey tools, establishing a high level overview of a company’s EVP can be attained without significant cost or resources


Measuring Results

You will need to identify new measures to monitor the impact of your Employment Brand campaigns

Traditional recruiting metrics will not be enough – you will want to correlate to key business indicators

Identify key measurements by the business and establish a benchmark/snapshot prior to launching the campaign

Measure shortly after launch and then on regular intervals

Ideally (albeit more difficult) roll the numbers up into a single number and call it a Brand Strength Indicator


Who is Volkswagen Group of America (VWGoA)

•  Volkswagen AG is the world’s third largest automaker

•  Brands sold in the U.S. include Volkswagen, Audi, Bentley, Lamborghini, Bugatti

•  2,500 employees in the U.S.

•  Facilities in 13 states

•  350 employees at U.S. headquarters in Herndon, Virginia as of April, 2009

•  Over 800 U.S. dealerships

•  Over 350,000 vehicle sales annually

•  Goal to sell over one million cars in the U.S. by 2018

•  U.S. production facility recently announced for Chattanooga, Tennessee to employ 2,000


A new way of working…

–  Dynamic, Fast –  Collaborative –  Customer Focused –  Bold and Fresh Thinking –  Performance Driven –  Trust Based –  Creative

September 6, 2007 we hit the

Button…

And announced a “new start”…

–  Implementation of a new company structure

–  HQ Relocation to Herndon, VA

–  New VWGoA Management Team Structure

–  The potential of U.S. Production

–  Resource consolidation/optimization and.…

Volkswagen Group of America, Inc. - Transformation


Michigan

Virginia

Relocation of U.S. Corporate Headquarters


Talent Management Challenges: Identifying the Tasks at Hand

May Jul Oct Mar 2008

Jun Nov Dec Apr Sept Aug Sept Oct Nov 2007

Dec Feb Jan

Announcement of H.Q. Relocation

Employee Notifications

Employee Relocation Decisions Due

Transfer of Operations Period

Workforce Transfer Plans Complete

Beginning Relocation of Corporate H.Q.

Complete Relocation of Corporate H.Q.

Targeted End Dates for Auburn Hills, MI Support

Timeline


Solution Part II: Employment Value Proposition (EVP)

Why is Employment Value Proposition (EVP) Important?

Why the EVP & Competency Framework help Shape the New Culture


EVP: Understanding the “Before” Picture

Approach to Analyze the Existing EVP

  Conducted 14 focus groups to survey the 154 employees that were invited to the new location, asking them:

•  What attributes were most important to them when selecting a career (Preference)

•  How VWGoA rated in delivering on those attributes (Perception)


EVP: Understanding the “Before” Picture People

• Co-Worker Quality • People Management

• Collegial Work Environment

• Manager Quality • Sr. Leadership

Reputation • Camaraderie

Opportunity • Stability

• Future Career Opportunity

• Developmental Opportunity • Meritocracy • Growth Rate

Work • Work Life Balance

• Job Interest Alignment • Location

• Recognition • Innovative

• Level of Impact • Business Travel

Rewards • Compensation • Health Benefits

• Retirement Benefits • Vacation

3.29 3.00 3.16 3.30 2.23 3.00 4.40 3.21 3.53 3.76

Existing talent places value primarily on Work & Opportunity

They rate work experiences high, while opportunity experiences are rated lower 3.16 and above 3.00 and below

Organization • Respect

• Ethics/Integrity • Empowerment

• Product/Service Quality

• Technology Level • Diversity

• Market Position • Formal/Informal Work

•  Environment • Brand Awareness

• Social Responsibility • Industry Desirability • “Great Employer”

Recognition • Customer Prestige

• Environmental •  Responsibility

• Organization Size • Risk Taking


The Process: Identifying Forward-Thinking EVP attributes

3.00 3.21 4.40 3.53 3.76 3.13 2.75 2.54 3.27 3.27 3.29 2.50

Organization • Respect

• Ethics/Integrity • Empowerment

• Product/Service Quality • Technology Level

• Diversity • Market Position

• Formal/Informal Work •  Environment

• Brand Awareness • Social Responsibility • Industry Desirability • “Great Employer”

Recognition • Customer Prestige

• Environmental •  Responsibility

• Organization Size • Risk Taking

Opportunity • Stability

• Future Career Opportunity

• Developmental Opportunity • Meritocracy • Growth Rate

Rewards • Compensation • Health Benefits

• Retirement Benefits • Vacation

Work • Work Life Balance

• Job Interest Alignment • Location

• Recognition • Innovative

• Level of Impact • Business Travel

People • Co-Worker Quality

• People Management • Collegial Work

Environment • Manager Quality • Sr. Leadership

Reputation • Camaraderie

Attributes sought in talent that will be coming on board in the new location should place value primarily on

Work & Organization


EVP Planning “After” Picture—a Clear Path from Current to Desired Attributes

Current Desired Innovative Work Level of Impact

Job Interests Alignment Work Life Balance

Stability Future Career Opportunity

Meritocracy

Empowerment Respect

Manager Quality Collegial Work Environment

Compensation

Opportunity

Market Position Brand Awareness

Risk-Taking Ethics/Integrity Empowerment

Respect

Innovative Work Level of Impact

Job Interests Alignment

Co-Worker Quality Collegial Work Environment

Meritocracy

Organization

Red = Where current attributes align with desired attributes Black = Where current attributes are less relevant Blue = Where desired attributes need to be valued

Work

Work

Opportunity

Organization

People

Rewards

People


Putting it Together—Connecting Competencies and EVP Strategy

Innovative Work Level of Impact Job Interests Alignment Meritocracy

Market Position Brand Awareness Risk Taking Empowerment

Collegial Work Environment Co-Worker Quality Respect Ethics/Integrity

Attribute

“Con

nect

ing

With

Our

Cus

tom

ers”

Product

Dealer Network

Brand Positioning

Local Production

Organization

Business Strategy

Dynamic, Fast, Creative Performance-Driven

Customer Focused Bold, Fresh Thinking

Collaborative Trust-Based

Organizational Culture

Teamwork

Competency

Innovation Performance-Driven

Customer Focus Change Leadership


In Conclusion…

Build…your business case

Identify…your Employment Value Proposition Create…your Employment Brand

Execute…your communications strategy

And remember, the two fundamental goals of the Employment Brand are

–  Provoke the right talent to leave whatever they are doing and accept employment with your organization (attraction)

–  Induce them to resist offers from other organizations and continue their employment with yours (retention)


Closing

Thank You

Mitzi Adwell Strategic Solutions Leader

The Newman Group [email protected]

Taking Control of EVP

Business

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