Analyzing Organizational Elements of Employee Value Proposition: The Employees Perspective

Analyzing Organizational Elements of Employee Value Proposition: The Employees Perspective Avinash Pawar Rajiv Gandhi Business School, India Abstract Today's dynamic business environment has created new challenges for IT companies Especially, the human resource of companies face various issues regarding attrition, turnover, talent attraction, talent management, manpower planning and employer branding etc The Employee Value Proposition (EVP) helps to state what the organization would most likely to be linked with an employee and defines the “give and get” of the employment agreement It has become meticulously associated at the center to the notion of employer branding and talent management It also serves as an organizational strategy to deal with various challenges of HR and Marketing IT industry in India has grown in multiple folds and earned respect and revenue in the world This knowledge intensive sector faces various problems of engagement, attrition, retention etc and concerned about the attracting and maintaining the good talent in the organization The organizational elements plays a vital role in developing a unique employee value proposition which helps to develop a good brand, talent attraction and sustainability of the organization, This paper analyses the organizational elements of employee value proposition from the perspectives of the employees working in IT companies in India The primary data is collected using a structured questionnaire from employees working in IT companies The outcome of study shows the difference of levels (Current and Expected) of organizational elements (Internal and External) from the employee’s perspective Keywords: Employer Branding, Employee Value Proposition, Organizational Strategies, Human Resource Marketing Introduction Employee value proposition is a correct balance of the offerings and benefits provided to employees for the contribution and performance in the organization Employee value proposition gives the clarity and a better stage for enriching the employer brand and employee experience Employee value proposition is creating a win-win situation for employer and employees in the organization This can be visible enough through employee motivation and commitment and organizations return on investment Which makes this employer and employee relationship more meaningful and fulfilling The organizations with well-aligned employee value proposition can significantly attract top talent from the market, increased levels of employee commitment and require less compensation to attract the talent Hence, organizations needs to have a formal employee value proposition which is documented, evaluated and communicated for current and future employees Developing an Employee value proposition can act as a differentiating strategy for organizations to ensure the availability of right people with right skills It is a connecting link between employee and employer A successful organization provides a differentiated 94 experience and a better career path to employees which can be adopted using a well-designed employee value proposition As IT industry is highly dependent on employees, to attract and keep the talented employees, companies are required to develop a unique employee value proposition for employees Employee value proposition is an integrated approach of human resource and marketing management in the organization Employee value proposition is also called as a tool of talent management and employer branding of the organization Employee value proposition is an organizational strategy focused and aligned with current and prospective employees In order to develop a good brand and increase the talent attraction of the organization the employee value proposition should be compelling and unique Hence, to become an employer of choice for the employers needs to transform the HR functions of the organization through a welldefined employee value proposition which results in better attractiveness, commitment and profitability 1.1 Objectives of Study: To analyses the organizational elements of employee value proposition To know the gap between current and expected levels of organizational elements To understand the most important organizational elements Literature Review Jublee, D & Kavitha, G., (2015)4 discussed about the essence of what the organization stands for and should typify the fundamental nature of the organization This is the process of placing an image of being a ‘great place to work’ in the minds of existing and prospective employees Rathore, H (2014)5 deliberated that, “the strategy employed by an organization to create an Employer Value Proposition (EVP) that would convey to desired current and prospective employees why the organization is unique, appealing and a fantastic place to work in EVP are communicated through company actions and behaviors and evoke emotive and rational benefits for current and prospective employees” Kennedy, K (2013)6 has expressed his views on the difference between Employee Value Proposition and Employer Branding According to him “many organizations have begun to define the employee experience in their company, and many have taken steps to add internal departments focused on the work of branding and communicating this experience Employee Value Proposition and Employer Brand are two sides of the same conversation Hewitt, A (2012)7 debated about “a strong employee value proposition is consistently valuable to employees across the world’s regions Companies create strong EVPs when employees are clear on performance expectations and feel that their employers in turn deliver on promises to them Strong EVPs are highly engaging A strong employee value proposition is about clarifying the employment contract articulating what they expect and in turn delivering on what employees expect” Lau, F (2009)8 expressed that, “An employee value proposition is the value or benefit an employee obtains through employment, simply put the value of an organization’s employment experience Developing an EVP has become the key to success in acquiring talent Minchington (2005)9 defined an Employee Value Proposition as a set of associations and offerings given by an organization in return for the skills, experiences and capabilities an employee brings into the organization It is an employee centered method that is aligned to existing, integrated manpower planning strategies as it has been well-versed by existing employees and the target external audience Methodology • Research Design: Descriptive Research • Data Collection: Survey Method 95 Tool: Structured Questionnaire Scaling: 5-Point Likert Scale Sampling: Non Probability Convenience Sampling Element: Employees working in IT Companies Sample Size: 512 employees The designed and adopted methodology helps and suffices the purpose of this research study 3.1 Hypothesis of Study: H0: There is a no significant difference in organizational elements from employee’s perspective H1: There is a significant difference in organizational elements from employee’s perspective Data Analysis 4.1 Element Identification: The researcher has identified following factors associated with the organization The analysis is done by considering these elements Table 1: Elements of Organization Internal External Organizational Stability Growth Rate Diversity Empowerment Product/Service Quality Size of Organization Risk Taking Informal Environment Technology Level Respect Ethics Employer Recognition Industry Market Position Brand Awareness Customer Reputation Social Responsibility Environmental Responsibility 4.2 Scatter Diagram: The scatter diagram shows the relationship between organizational elements and Employee Value Proposition of IT Companies Figure 1: Scatter Diagram of Organizational Elements 96 The scatter diagram shows that as the organizational elements increases, so is the Employee Value Proposition The positive correlation may exist between organizational elements and Employee Value Proposition 4.3 Elements Analysis The elements analysis is done by analyzing the current and expected levels along with the mean rank and sum of ranks Factor Organizational Stability Growth Rate Diversity Empowerment Employer Recognition Product/Service Quality Industry Size of Organization Risk Taking Informal Environment Market Position Levels N Mean Rank Sum of Ranks Expectation 512 625.26 320131.00 Current 512 399.74 204669.00 Total 1024 Expectation 512 661.65 338764.00 Current 512 363.35 186036.00 Total 1024 Expectation 512 523.65 268107.50 Current 512 501.35 256692.50 Total 1024 Expectation 512 619.12 316991.00 Current 512 405.88 207809.00 Total 1024 Expectation 512 607.97 311278.50 Current 512 417.03 213521.50 Total 1024 Expectation 512 619.81 317340.50 Current 512 405.19 207459.50 Total 1024 Expectation 512 601.20 307814.50 Current 512 423.80 216985.50 Total 1024 Expectation 512 458.55 234776.00 Current 512 566.45 290024.00 Total 1024 Expectation 512 599.48 306934.50 Current 512 425.52 217865.50 Total 1024 Expectation 512 537.19 275040.00 Current 512 487.81 249760.00 Total 1024 Expectation 512 547.63 280385.00 Current 512 477.37 244415.00 97 Brand Awareness Customer Reputation Technology Level Respect Ethics Social Responsibility Environmental Responsibility Total 1024 Expectation 512 588.73 301427.50 Current 512 436.27 223372.50 Total 1024 Expectation 512 545.66 279380.00 Current 512 479.34 245420.00 Total 1024 Expectation 512 553.32 283301.00 Current 512 471.68 241499.00 Total 1024 Expectation 512 658.29 337044.50 Current 512 366.71 187755.50 Total 1024 Expectation 512 613.93 314333.00 Current 512 411.07 210467.00 Total 1024 Expectation 512 556.22 284787.00 Current 512 468.78 240013.00 Total 1024 Expectation 512 564.00 288767.00 Current 512 461.00 236033.00 Total 1024 Table 2: Mean Rank Analysis for Organizational Elements 4.4 Levels for Elements: The analysis in terms of current level and expected level is computed The difference in both of the levels for all internal and external organizational elements are evaluated No Organizational Element Current Level Expected Level Difference Internal O rganizational Ele ments Organizational Stability 399.74 625.26 225.52 Growth Rate 363.35 661.65 298.30 Diversity 501.35 523.65 22.30 Empowerment 405.88 619.12 213.24 Product/Service Quality 405.19 619.81 214.62 Size of Organization 566.45 458.55 -107.90 Risk Taking 425.52 599.48 173.96 Informal Environment 487.81 537.19 49.38 98 Technology Level 471.68 553.32 81.64 10 Respect 366.71 658.29 291.58 11 Ethics 411.07 613.93 202.86 No Organizational Element Current Level Expected Level Difference External Organizational Elements Employer Recognition 417.03 607.97 190.94 Industry 423.80 601.20 177.40 Market Position 477.37 547.63 70.26 Brand Awareness 436.27 588.73 152.46 Customer Reputation 479.34 545.66 66.32 Social Responsibility 468.78 556.22 87.44 Environmental Responsibility 461.00 564.00 103.00 Table 3: Levels and Difference of Organizational Elements The difference between the current level and expected level of organizational elements from the employee’s perspectives is computed This will further help to grade and rank these factors to know the most important factors which affects the employees working in IT companies in India Chart 1: External Organizational Elements 99 700 600 500 400 300 200 100 Employer Recognition Industry Market Position Awareness Reputation Brand Customer Social Responsibility Responsibility Current Level Environmental Expected Level Chart 2: Internal Organizational Elements 4.5 Grading and Ranking of Elements: The grading and ranking of elements is done using the difference, mean rank and sum of ranks for each element Rank Organizational Element Difference Mean Rank Sum of Ranks Growth Rate 298.3 661.65 338764.00 Respect 291.58 658.29 337044.50 Organizational Stability 225.52 625.26 320131.00 Product/Service Quality 214.62 619.81 317340.50 Empowerment 213.24 619.12 316991.00 Ethics 202.86 613.93 314333.00 Risk Taking 173.96 599.48 306934.50 Technology Level 81.64 553.32 283301.00 Informal Environment 49.38 537.19 275040.00 10 Diversity 22.3 523.65 268107.50 11 Size of Organization -107.9 458.55 234776.00 Table 4: Ranking of Internal Organizational Elements 100 Rank Organizational Element Difference Mean Rank Sum of Ranks Employer Recognition 190.94 607.97 311278.50 Industry 177.4 601.20 307814.50 Brand Awareness 152.46 588.73 301427.50 Environmental Responsibility 103 564.00 288767.00 Social Responsibility 87.44 556.22 284787.00 Market Position 70.26 547.63 280385.00 Customer Reputation 66.32 545.66 279380.00 Table 5: Ranking of External Organizational Elements The rank for the expectation of the employees is understood by the difference (Current and Expected Levels) and sum of ranks This helps us to understand the most important internal and external organizational elements This also shows the importance levels of these elements in IT companies in India which can help the IT companies to strategies for organizational effectiveness and develop a good employee value proposition 4.6 Hypothesis Testing: The hypothesis is tested with the Mann-Whitney test for all the organizational elements The null and alternate hypothesis are as follows H0: There is a no significant difference in organizational elements from employee’s perspective H1: There is a significant difference in organizational elements from employee’s perspective MannWhitney U Wilcoxon W Z P value (2-tailed) Organizational Stability 73341.000 204669.000 -12.861 000 Growth Rate 54708.000 186036.000 -16.807 000 Diversity 125364.500 256692.500 -1.296 195 Empowerment 76481.000 207809.000 -12.381 000 Employer Recognition 82193.500 213521.500 -11.082 000 Product/Service Quality 76131.500 207459.500 -12.290 000 Industry 85657.500 216985.500 -10.356 000 Size of Organization 103448.000 234776.000 -6.172 000 Risk Taking 86537.500 217865.500 -9.876 000 Informal Environment 118432.000 249760.000 -2.855 004 Market Position 113087.000 244415.000 -4.106 000 Brand Awareness 92044.500 223372.500 -8.709 000 Customer Reputation 114092.000 245420.000 -3.845 000 Factor 101 Technology Level 110171.000 241499.000 -4.750 000 Respect 56427.500 187755.500 -16.674 000 Ethics 79139.000 210467.000 -11.685 000 Social Responsibility 108685.000 240013.000 -4.984 000 Environmental Responsibility 104705.000 236033.000 -5.851 000 Table 6: Mann-Whitney Test for Hypothesis Testing As the P value is lesser than 0.05 significance level for all elements except for the factor of diversity It signifies that, alternate hypothesis is accepted and the null hypothesis is rejected It confirms that, there is a significant difference in organizational elements from employee’s perspective in IT companies in India Findings and Suggestions The internal and external organizational elements can help the companies for developing the employee value proposition (Ref: 4.1) There is a positive association between the organizational elements and employee value proposition (Ref: 4.2) There is difference between the current levels and expected levels for all internal and external organizational elements from the employee’s perspectives (Ref: 4.3, 4.4) The top internal organizational elements from the employee’s perspective are Growth Rate, Respect and Organizational Stability It is necessary that organization should provide the growth opportunities, respect people irrespective of designations and should maintain the stability in terms of job and future of employees (Ref: 4.5) The top internal organizational elements from the employee’s perspective are Employer Recognition, Industry and Brand Awareness The organizations should have a good recognition in the market for their products and services and work or operate in the particular industry Companies should also have a good brand awareness which can be done developing and communicating the brand of the organization (Ref: 4.5) The internal element of Size of Organization shows that, the expected size is less than the current size of organization which suggest that, employees prefers the smaller organizations It is due to perception that, the employee’s recognition is lesser in larger originations (Ref: 4.5) The organizational internal element of diversity is found insignificant which shows that, employees in IT companies not want more diversity It is due to the different perceptions about the cultural difference in different states (Ref: 4.6) There is a significant difference in organizational elements from employee’s perspective (Ref: 4.6) Internal and External Organizational Elements can help the organizations to develop the unique and compelling Employee Value Proposition Conclusion The Employee value proposition is about defining es sence, identity and uniqueness of the company for employees and it signifies the overall deal bet ween employer and employee The employer makes a deal to the employee and expects contributions from the employee in return The organizational elements plays a crucial role in dev eloping a good employee value proposition and helps the organizations to develop and 102 sustain in f uture and for implementation of good Employee Value Proposition require the IT companies to under stand the importance of these organizational elements with the perspective of employees There i s a significant difference observed between the current levels and expected levels for all inte rnal and external organizational elements from the employee’s perspectives Hence, there is need t o bridge this difference by developing a good employee value proposition References Talent Smoothie (2015) Employee Value Proposition (EVP) Yates, K and Sejen, L (2011) Employee Value Propositions: Creating Alignment, Engagement and Stronger Business Results, Society for Human Resource Management webcast, Tower Watson Hill, B & Tande, C (2006) Total Rewards: the Employee Value Proposition, workspan, October, viewed on 17 Feb 2018, Available at: www.tandehill.com Kavitha, G., & Jublee, D (2015) Employer branding in Indian IT companies IJABER, Vol 13, No 2, (2015): 905-912 Rathore, H (2014) Employer branding: a synergistic and reinforcing for an organization International Journal of Transformations in Business Management Vol No 4, Issue No IV, ISSN: 2231-6868 Kennedy, K (2013) What’s the Difference between the Employee Value Proposition and the Employment Brand? Kenedy Communications Global Hewitt, A (2012) 2012 Trends in global employee engagement Aon Corporation Retrieved May, 11, 2018 Lau, F (2009) The Power of Employment Value Proposition Manpower Services Australia Minchington (2005) Employee Value Proposition A Global Perspective 103