Employee Value Proposition (EVP) is the jargon commonly used to describe the characteristics and appeal of working for an organisation. An EVP describes the mix of characteristics, benefits, and ways of working in an organisation. It is the deal struck between an organisation and employee in return for their contribution and performance. This ‘People Deal’ characterises an employer and differentiates it from its competition.

A well-articulated and consistently communicated EVP can help you to attract and retain talent, appeal to different markets and ‘tough to hire’ talent groups, re-engage a disenchanted workforce, prioritise your HR agenda, create a strong ‘people’ brand, and reduce new-hire premiums.

An effective EVP can bring an organisation significant benefits. According to the Corporate Leadership Council’s research, a well-thought through and executed EVP can:

In addition, an effective EVP allows organisations to source more deeply within the labour market, increasing access to passive candidates. This is important for organisations who want to secure the best talent in an increasingly difficult talent market.

To ensure an EVP generates maximum returns, it must be built around attributes that genuinely attract, engage and retain the talent you want. It must also be consistent with strategic objectives and clearly demonstrate its uniqueness. The EVP must also be real i.e. a large proportion of it must be true now. It should, however, also contain elements that are not true now but that the organisation aspires to. This is important to drive change and progress, and also to give employees a sense that the organisation is responding to the changes they want to see.

As well as the ‘content’ of the EVP, it must also be articulated in a style that appeals to the audience. So many companies write about themselves in dull corporate speak and the net result is a lot of organisations that claim to be unique but sound the same.

Finally, the EVP is at the core of all other organisational processes.

The characteristics of the EVP need to be reflected in the corporate and employer brands. The EVP, if operationalised well, is the driver of engagement, it informs recruitment messages and communications, and it helps inform strategic HR priorities. It helps support and drive business strategy forward.

There are a number of ways to understand what your employees feel constitutes a great place to work. A good starting point is to tap into information you already have, including employee opinion survey data. This will tell you what employees think is working and what isn’t. Typically though, such surveys don’t tell you what is important to your people. It is crucial to understand this in order to create an attractive EVP. The process of developing an EVP elicits what is important to the different types of people that you want to attract and engage.

To be successful the EVP must be credible which is why it must always be tested. The purpose of testing is to ensure that all categories of employees and potential employees find it appealing. The testing also tells you which elements of the EVP need to be ‘turned up’ or ‘turned down’ to appeal to different groups. Testing should take place with internal employees and external potential employees. The testing will reveal changes that need to be made to the EVP to appeal to the different audiences that it was tested with. Assuming that valid and rigorous data is used to create the EVP, we expect it to work for 90% of the target population. It should always be tested though, as the 10% it needs to be adjusted for could be a crucial part of your workforce.

You can download our free Employee Value Proposition Factsheet and our Action Sheet How to Maximise the Value of your Employee Value Proposition on our Insights page.

You can find all our case studies on our Results page. Let’s look at just one example here. We developed an Employee Value Proposition for AstraZeneca. Their goals were to:

• Differentiate themselves against other large pharmaceuticals
• Use the EVP to help make the new corporate brand a reality
• Identify priority areas for change, in order to maintain and improve engagement of key talent

We developed a draft EVP using our grounded theory research methodology. The EVP comprised of five themes. We tested the five themes externally and internally across 12 countries and with 15 key talent groups. We then adapted some of the elements of the EVP that did not work for the target groups either due to cultural differences or lack of importance. We also added some elements that were important but had not been evident in the source data.

As well as the EVP itself there have been a number of other key outputs. An online user guide for HR and managers provides guidance on managing and engaging different key groups. A recruiters’ guide to employer branding indicates message content and style that appeals to different segments. In addition, the company is using the data to inform HR strategic priorities. This is a great example of a company that now has a clear and differentiated EVP and is making it work hard in a very practical and tangible way.