Employment Value Proposition (evp)

North Carolina state government faces increasing competition in recruiting and retaining "talent" — high-performing people with key knowledge, skills and abilities. State agencies compete with both private sector employers and other public sector employers to attract and keep highly qualified, high-performing employees. Universities compete with educational institutions throughout the world and also with private sector employers in research fields. Thus, it is important to communicate the benefits of state government employment to prospective employees. It is equally important to consistently deliver those benefits to current state employees.

Why is there increased labor market competition, often called the "War for Talent"?

The Corporate Leadership Council (CLC) [link to website] has identified two trends that lead to a talent scarcity problem; thus, increased competition faced by recruiters and managers in the labor market.

Trend #1: Intensifying Competition for Talent due to the following factors

A strong economy
Declining unemployment
Skill shortage in low-wage countries
Accelerating retirement

Trend #2: Increasing Workforce Complexity due to the following factors

Increased cross-border trade
Aging workforce
US service jobs moving offshore
Virtual talent pools expanding (telecommuting)

What is the Employment Value Proposition (EVP)?

In 2006, the Corporate Leadership Council surveyed its membership and a global panel of respondents representing 34 countries and 20 industries in eight languages. The survey was designed to ensure representation of respondents across geographies, industries and demographic groups. A list of 38 organizational attributes was tested. The attributes were grouped into five categories: rewards, opportunity, organization, work and people (see Table 1). See Table 2 below for definitions of the 38 organizational attributes.

An organization's employment value proposition (EVP) is defined as the set of attributes that employees and the labor market perceive as the value they gain through employment in the organization.

What are the top ten attributes that determine attraction and commitment to an organization?

Results of the survey indicate that the top ten EVP attributes that drive attraction and commitment in United States organizations are:

Top Ten Drivers of Attraction and Commitment U.S. organizations, 2006

Attraction What brings people to the organization	Commitment What keeps people at the organization
1. Compensation	1. Job-Interest Alignment
2. Health Benefits	2. People Management
3. Organizational Stability	3. Respect
4. Work-Life Balance	4. Manager Quality
5. Future Career Opportunities	5. Development Opportunities
6. Respect	6. Future Career Opportunities
7. Job-Interests Alignment	7. Senior Leadership Reputation
8. Location	8. Ethics
9. Retirement Benefit	9. "Great Employer" Recognition
10. Ethics	10. Meritocracy

It is important to note that four attributes are in the top ten lists for both attraction and commitment:

Job-Interests Alignment — whether the job responsibilities match your interest
Future Career Opportunities — the future career opportunities provided by organization
Respect — the degree of respect that the organization shows employees
Ethics — the organization's commitment to ethics and integrity

Why do state agencies and universities need to understand and manage their EVP?

"An organization's EVP is the set of attributes that the labor market and employees perceive as the value they gain through employment in the organization." An effective EVP can provide three measurable benefits:

Improved attractiveness — Organizations with effective EVPs are able to source from a much deeper pool of talent in the labor market. Top-performing organizations draw candidates from about 60% of the labor market, including "passive" candidates who would otherwise be content to stay with their current job. Lesser-performing organizations are able to source only from the most active 40% of the workforce.
Greater employee commitment — Organizations with effective EVPs enjoy significantly higher levels of commitment from their employees. Top-performing organizations have 30-40% of their workforce displaying high levels of commitment, compared to 10% in underperforming organizations.
Compensation savings — Organizations with effective EVPs are able to reduce the compensation premium required to attract new candidates. Top-performing organizations are able to spend 10% less on base pay compared to under-performing organizations."

Agencies and universities in North Carolina have difficulty recruiting and retaining employees in certain areas. The Corporate Leadership Council concludes that this growing talent shortage does not stem from a single cause, but is the result of wide-ranging and diverse problems in organizations across the globe — insufficient skills, insufficient experience, pending retirements, wage inflation and high turnover. Agencies and universities are competing for talent with the private sector and other public sector organizations locally, in the Southeast United States, nationally, and in some cases, globally. Competition for talent likely will increase during the next decade.

Understanding and improving the agency/university's EVP can increase the size of the most qualified pool during the recruitment phase. It can also increase the selected candidate's "fit" with the organization. Once the candidate joins the organization, the EVP can improve his/her effort levels and performance by promoting greater commitment. Developing an understanding of generational differences enhances your EVP. And finally, developing and communicating your EVP can reduce turnover.

How do state agencies and universities start to build an effective EVP?

Each agency and university is unique in its talent requirements and recruitment challenges. Likewise each agency and university has a unique set of attributes that drives attraction and commitment. Most likely, the set of attributes for any one agency/university will include several of the attributes found to be drivers in U.S. organizations. Agencies and universities can develop their EVP by conducting focus groups, surveying employees and other data collection methods.

A competitive EVP should begin with the attributes most important to attraction and retention, and should be aligned with the organization's long-term strategy. For agencies that have multiple locations across the state, the EVP should be locally relevant and consistent across all locations.

After an assessment of each attribute's importance to attraction and commitment, agencies and universities should consider the following:

Which attributes are consistent with our strategic objectives?
How capable are we of delivering each attribute?
How much will it cost to improve our delivery of each attribute?
How well do our labor-market competitors deliver each attribute?

How can state agencies and universities best manage the EVP and ensure credibility in the labor market?

The Corporate Leadership Council concludes that building a competitive advantage in the labor market requires active management of both the EVP and the employee experience. Organizations need to deliver their EVP to current employees consistently and continually. Managers at all levels of the organization need to understand the EVP, and then, carefully align their actions and communication to be consistent with the EVP. The day-to-day environment created by each manager will affect perception of the EVP and, in the long run, have some impact on attraction and retention.

Organizations often fail to deliver on the less tangible aspects of the EVP such as respect, manager quality and development opportunities. Attributes such as these are harder to assess during the recruiting process and more volatile over time. The organization faces a greater risk of employee dissatisfaction with these attributes. These intangible attributes have strong impacts on commitment and put organizations at significant risk of disengaged employees. On the other hand, if these intangible attributes are delivered, the organization will have a competitive edge in the labor market and will have more committed employees.

The Corporate Leadership Council research finds that:

"Organizations face two critical challenges in communicating their EVP: First, the broader labor market generally distrusts traditional communication channels. Second, the most trusted communication channel — an organization's current employees — often does not actively advocate for their organization.

To improve broader communications with the labor market, organizations need to ensure that communications during the recruiting process are candid, accurate and consistent: Specifically, recruiting processes should accurately reflect the realities of the work environment, be consistent in their representation of the EVP and facilitate candidates' self-assessment of their fit with the organization.

Current employees are one of the most widely used and highly trusted sources of organizational information for potential job candidates: More that 80% of job candidates find current employees to be a credible source of information. Further, candidates referred by employees have significantly higher levels of commitment to the organization."

Agencies and universities should continually monitor the following to ensure effective EVP management and communication:

Recruitment processes
Interviewing skills of managers
Early employment experience of new hires
Formal communication vehicles and messages
Informal communication such as issues raised by employees, manager observations
Employee satisfaction results, etc.
Manager evaluations
Employee forums, annual employee meeting and events

Table 1- Organizational Attributes

Rewards	Opportunity	Organization		Work	People
Compensation	Development Opportunities	Customer Reputation	Market Position	Business Travel	Camaraderie
Health Benefits	Future Career Opportunities	Diversity	Product Brand Awareness	Innovation	Collegial Work Environment
Retirement Benefits	Organization Growth Rate	Empowerment	Product Quality	Job Impact	Coworker Quality
Vacation	Meritocracy	Environmental Responsibility	Respect	Job- Interests Alignment	Manager Quality
	Organizational Stability	Ethics	Risk Taking	Location	People Management
		"Great Employer" Recognition	Organization Size	Recognition	Sr. Leadership Reputation
		Industry	Social Responsibility	Work Balance
		Informal Environment	Technology Level

Table 2 - Definitions of Organizational Attributes

Attribute	Definition
Business Travel	The amount of out-of-town business travel required by the job
Camaraderie	Whether working for the organization provides opportunities to socialize with other employees
Collegial Work Environment	Whether the work environment is team-oriented and collaborative
Compensation	The competitiveness of the job's financial compensation package
Coworker Quality	The quality of the coworkers in the organization
Customer Reputation	The reputation of the clients and customers served in performing jobs
Development Opportunities	The development/educational opportunities provided by the job and organization
Diversity	The organization's level of commitment to having a diverse workforce
Empowerment	The level of involvement employees have in decisions that affect their job and career
Environmental Responsibility	The organization's level of commitment to environmental health and sustainability
Ethics	The organization's commitment to ethics and integrity
Formal/Informal Work Environment	Whether the work environment is formal or informal
Future Career Opportunities	The future career opportunities provided by organization
"Great Employer" Recognition	Whether or not the organization's reputation as an employer has been recognized by a third-party organization
Growth Rate	The growth rate of the organization's business
Health Benefits	The comprehensiveness of the organization's health benefits
Industry	The desirability of the organization's industry to the respondent
Innovation	The opportunity provided by the job to work on innovative, "leading edge" projects
Job-Interest Alignment	Whether the job responsibilities match your interests
Job Impact	The level of impact the job has on outcomes
Location	The location of the jobs the organization offers
Manager Quality	The quality of the organization's managers
Market Position	The competitive position the organization holds in its market(s)
Meritocracy	Whether or not employees are rewarded and promoted based on their achievements
Organization Size	The size of the organization's workforce
Organizational Stability	The level of stability of the organization and of the job
People Management	The organization's reputation for managing people
Product Brand Awareness	The level of awareness in the market place for the products brand
Product Quality	The organization's product or service quality reputation
Recognition	The amount of recognition provided to employees by the organization
Respect	The degree of respect that the organization shows employees
Retirement Benefits	The comprehensiveness of the organization's retirement benefits
Risk Taking	The amount of risk that the organization encourages employees to take
Senior Leadership Reputation	The quality of the organization's senior leadership
Social Responsibility	The organization's level of commitment to social responsibility (e.g., community service, philanthropy)
Technology Level	The extent to which the organization invests in modern technology and equipment
Vacation	The amount of holiday/vacation time that employees earn annually
Work-Life Balance	The extent to which the job allows you to balance your work and your other interests


		Employment Value Proposition