I have been asked to write an article about how employer branding affects businesses. Now, keep in mind that we’re talking about the IT industry in Serbia specifically. In Serbia, employer branding means taking your employees out for a beer every Friday, while, at the same time, you’re getting the lowest scores from your employees on online platforms for employer reviews. (Yes, I do like extreme examples, and I also like drinking beer on Fridays). Doing employer branding that way won’t affect a business, at least not positively.
Employees who are not satisfied are not motivated to give their best.
This brings us to two possible scenarios:
- those who are less ready to face the dreaded process of searching for a new job stay where they are, half-ass their work tasks, and contribute, well, nothing,
- while the more courageous ones leave without looking back.
The company becomes a flow-through pool, which in return makes it difficult to attract the highly-capable people who would take your product or service to the next level. And since the IT industry in Serbia is a very small pond, secrets are hard to keep (especially when it comes to knowing which companies have fired people during Covid, which ones fire women if they get pregnant, etc).
I could stop right here and finish with this – happy employees will directly contribute to the development of your business.
However, let’s go back to the beginning…
…because there are as many definitions of “happy employee” as there are stars in the sky.
It’s been 5-6 years since the term “employer branding” started popping up at every corner, but it’s still considered something that is “nice to have” but not necessary for the company’s success, even though globally 51% of recruiters claim employer branding is the most important investment that they will increase in the next year (SaaSworthy).
Those of us who specialize in employer branding are constantly influencing how EB is perceived and working on helping people realize why it’s so important.
Steven Covey once said ”Begin with the end in mind”, and to that point, it really is important to know what your end goals are, however, it seems that some people take this advice a bit too seriously and focus only on the goal while skipping important steps along the way. This causes them to skip all the steps when it comes to internal strategies, and to implement only one, external strategy – to broadcast an ad that shows how awesome they are and how nothing is rotten in the State of Denmark.
A certain number of employer branding specialists are focused solely on promoting the clients externally, which essentially boils down to a more social version of PR, while internally they do little or nothing at all to improve the working conditions or a company’s culture.
So, it is fair to say that some of us have personally contributed to the low priority that has been assigned to employer branding, especially the kind that should be implemented internally (there are many great articles on the subject, one of them – “Selling the Brand Inside” written exactly 20 years ago by Colin Mitchell).
The fact is, employer branding can make or break your business, whether you’re in IT or another industry, and the influence can be both positive and negative – there is nothing in between. A globally famous shoe manufacturer with production facilities in Serbia is a very good example of a company that has been accused of maltreating its employees on various occasions and is now in the process of liquidation.
Similarly, a clothing company from Serbia, got the award for the best online presence on Instagram, only to experience a dramatic drop in sales after their marketing manager shared online her story of miserable working conditions and mobbing at work.
In relation to that, multiple research studies have confirmed and quantified the positive impact that the satisfaction of your employees can have on the satisfaction of your customers. For example, a 1-star increase in your Glassdoor grade translates to a 1.3-star increase in customers’ satisfaction with your product/service.
At the same time, 64% of people stop buying a certain product if they hear that the company is mistreating their employees. Add to that the Covid crisis which has shown us that consumers make their decisions based on brand image more than anything, and that leaves no room to question how important employer branding really is for any company.
But, it’s not only the consumers who are important here – we need to think about potential new employees, and that’s what the focus is on when it comes to EB.
We all know that ever since the bear market started the IT sector has been in a phase of firing people, pausing hiring, or decreasing the salaries of its employees. We are watching the reputations of certain companies melt away and disappear like a snowman in the sun. Will the trend of looking for a culture fit continue? Or will we go back to the old days of chasing the job with the highest payday?
Judging by the results of the research according to which 69% of candidates would reject an offer from a company with a bad employer brand, even if they were unemployed (source), no matter what tectonic disturbances occur, the importance of a good brand remains unshaken. Conclusion:
Even the fear of unemployment isn’t enough to overcome a negative employer brand.
Let’s look at some numbers from a global study that show how significant the influence of brand image and reputation is to potential future employees:
- 86% of women and 67% of men in the United States wouldn’t join a company if it had a negative reputation as an employer (Glassdoor report)
- 7 out of 10 people indicated they had changed their opinion about a brand after seeing the company reply to a review (Marketing Charts)
- 50% of candidates say they wouldn’t work for a company with a bad reputation, even for a pay increase (HR Daily Advisor)
- 92% of people would consider changing jobs if offered a role with a company with an excellent corporate reputation (HR Daily Advisor)
- A strong employer brand can reduce the cost per hire by as much as 50% (Business LinkedIn)
- 62% of Glassdoor users agree their perception of a company improves after seeing an employer respond to a review. (Glassdoor)
- A negative reputation costs companies at least 10% more per hire. (Harvard Business Review)
- 40% of passive candidates would accept a new position without an increase in pay if the company had a good employer brand (source).
Internal EB strategies that bring results
There are some bright examples amidst all this. One value has since surfaced and became the new buzzword in the work market – transparency. The companies which have communicated transparently with their employees, as well as the public, are now among the most desirable employers.
It’s interesting to note that globally “74% of employees feel they are missing out on company information and news” (Trade Press Services). On the other hand “the use of social software by employees” which helps them stay up-to-date with company news “can improve productivity by 20-25%” (McKinsey).
In conclusion, not treating your employees as cogs in a machine, or as “just coders”, but by treating them as a valuable part of the system and including them in different aspects of your business, you can profit in the long run.
A shining example in our local community is one employer who uses Basecamp to do just that, but also to facilitate all communication. This means they use only Basecamp – no Slack, no Viber, WhatsApp, or Telegram, no email, no asking your employees to be present 24/7 – just one channel that everyone uses, and that contains all the necessary information. Why? Because it has become apparent that increasing the number of channels people have to use to communicate leads to a significant drop in productivity.
However, due to the new economic crisis (which has overshadowed the still-present Covid crisis), this has become more important than ever.
“Employees are unhappier than ever before…” This is the first sentence in an article that talks about a “3.5% decline in employee happiness globally from October of 2020 to October of 2021”. During Covid, people have become more
aware of their core values and started putting their needs and qualities first, which meant leaving jobs that made them unhappy or changing their professions altogether, in the search of a workplace culture that could fit them better. Even back in 2016, before all this happened, 66% of people wanted to know about a company’s culture and values above all else when considering changing jobs (2016 Talent Trends study).
Once your employees start identifying with your brand, they start living and breathing company culture, and they share this with everyone who’s willing to listen. And most important of all, they do this because they want to, organically, and not in a fake, salesy, forced way.
Now THAT’S what real employee branding is all about.
Employees are the mirror of your brand.
Investing in your employees by encouraging them to become part of the brand will help your image and likeness. People can’t tell what a company is like based on your ads or your job postings, but if they see that John Doe (who is an expert in his field and with whom they share values and opinions) works for you, they will want to come work with him.
Here are some numbers to support this:
- Leads that come from employees’ social media activities have a 7X higher conversion rate than other leads. (SaaSworthy)
- On average, employees have 10X more followers than their company’s social media accounts. (SaaSworthy)
- Content that employees share receives 8X more engagement than content shared by brand channels. (SaaSworthy)
- Brand messages reached 561% further when shared by employees vs the same messages shared via official brand social channels. (MSLGroup)
Thanks, Rex Miller.
However, culture IS strategy. To be precise, culture should be strategized. Employee branding should be the heart of your organization.
This brings us back to the beginning.
If you have a flow-through pool culture, no EB strategy in the world can help you. What you reap is what you sow, but keep in mind that not everything is about quantity – it’s about the quality of your efforts.
If you invest in beer on Fridays, your employees will for sure have a hangover on Saturday, but they won’t necessarily be more motivated to work on Monday.
So, what’s worth investing in then?
People are – those who work for you as well as with you. And investing in improving communication with them.
How?
By asking questions and understanding their needs.
