What is an employee value proposition (EVP)?
An employee value proposition, also called EVP, is the sum of all the benefits and rewards people receive in exchange for performance in the workplace. It’s essentially what you, as an employer, can offer in return for a person’s skills, experience, and abilities.
EVP is a major part of any employer brand, showing the unique value your organization can offer to potential team members.
What components make up an employee value proposition?
An EVP is made up of five elements, including:
- Compensation: This element includes salary as well as the entirety of your benefits package, including insurance, retirement, bonuses, tuition reimbursement, wellness programs, and any other perks. It also includes your ability to offer pay on a timely schedule, give appropriate raises, and compensate all people fairly.
- Work-life balance: This includes flexible hours, work from home, vacation time, PTO policy, and paid parental leave.
- Stability: This refers to your organization’s ability to ensure people know their job is safe and to help them grow and develop. It includes things like mentoring, coaching, training, learning, and development.
- Location: This is all about the work environment you offer, both in a literal, physical sense and a more figurative one.
- Respect: This element refers to your company culture, your organization’s values, your management, teamwork, trust, and so on.
Why do you need an employee value proposition?
Your EVP ultimately defines how the talent you attract and hire perceives your brand. It can differentiate you from your competitors and help encourage people to choose to work for you instead of another company. In today’s competitive climate, this is essential because it is your talent that ultimately determines your organization’s ability to grow and succeed.
In particular, you can use your EVP to attract tech talent if you work in the notoriously competitive high-tech industry or others like it.
What are some examples of an employee value proposition?
To help you learn how to create a compelling employee value proposition, here are a few examples of companies who have theirs dialed in.
- Unilever: As Anuradha Razdan, Unilever’s head of global talent attraction and brand, Europe, explains, “At the heart of our value proposition is that we build leaders. We develop leaders for Unilever, and Unilever leaders go on to be leaders elsewhere in the world.” This strong focus on the stability element of EVP is highly appealing to candidates interested in growing while working with inspiring people toward the goal of improving people’s lives.
- Trader Joe’s: Widely recognized as one of the best retail employers, Trader Joe’s wins people’s loyalty with an EVP emphasizing learning and growth opportunities, fair benefits (such as their bi-annual reviews with potential for a seven to 10 percent pay increase each year), and a flexible, diverse, and communicative culture.
- Bain & Company: Ranked first on Glassdoor’s Best Places to Work list, this consulting company has several memorable perks in their EVP, including externship opportunities, global transfers, parental leave, leaves of absence, flextime, and an opportunity to take two months off.
How can you measure your employee value proposition?
There are a few KPIs you can look at to measure how effective your EVP is at helping you attract, hire, and retain talent, including:
- Retention rate
- Attrition rate
- Cost per hire
- Number of applicants
- Employee net promoter score
- Rankings and scores on websites such as Glassdoor
- Employee referrals
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How can you develop an employee value proposition?
Now that you’re familiar with what an EVP is, the next step is learning how to develop one for your organization. We recommend taking the following steps:
- Perform an audit: Look at your current brand identity. How do you communicate with and try to attract talent? What’s special about your compensation package, culture, or work environment?
- Ask for feedback: Some of the most valuable information you’ll be able to gather will be from current and former employees. Use surveys, internal focus groups, and exit interviews to ask:
- What attracted your people to apply to work for you?
- What made them choose you over other companies?
- What do people love about working with you?
- How could you improve what you offer people?
- Define critical points to include in your EVP: Using the information you’ve gathered, make a list of the things that make you stand apart as a great employer.
- Draft your EVP: Now you’re ready to write an EVP focusing on what you can offer your ideal candidate. Aim to use language that’s clear, unique, and inspirational.
- Evaluate your EVP: Your EVP doesn’t have to be static. Use the KPIs we mentioned above to revisit your EVP regularly to see if you can improve it.
Why should EVP be a part of modern HR strategy?
Your ability to attract, hire, and retain top talent is key to your organization’s capacity to succeed. A compelling, unique EVP is a critical tool in the effort to find and employ the best people.