L&D’s Important Role in the Employment Value Proposition
Employment Value Proposition (EVP). It is a term used frequently within human capital management circles, and as recent Brandon Hall Group research shows, training and development has a big impact on EVP. But even though the concept has been around for a couple of decades, many people—even HCM professionals—don’t really understand it. This article will explain the value of EVP and training’s role in it.
EVP is a construct of what employers and employees value in each other. It is based on a series of pillars that describe different aspects of an organization’s relationship with their employees. Examples include:
- Work impact
- Organizational culture
Each pillar comprises a variety of attributes. For example, organizational culture might include collaboration and high employee engagement. The manner in which an organization manages its EVP affects success in performance/productivity, attracting talent, engaging talent, retaining talent, customer satisfaction, and many other indicators.
While the concept of EVP has been around for quite awhile, many organizations have yet to formally define their EVP. Only 15 percent have a well-defined and communicated formal EVP. The rest in various stages of development, as shown here:
The primary reason for this lack of formalization may be that nearly two-thirds of organizations do not understand the components of the EVP. The other reasons seem to relate to organizational culture and budget. Approximately, one-quarter attribute this lack of EVP formalization to a lack of tools and technology.
In order to understand the components of an EVP, it is necessary to do some research among employees and executives to understand how each perceives and describes their motivators for working at the organization. These motivators can include:
- Organizational goals/mission/values
- Training/development/career paths
- Significance of the work itself
- Communication within the organization
It is also important to develop an understanding of the employee profile, such as educational level, experience level, schedule preference, etc. Once this comprehensive view of the organization is completed, it is necessary to align the EVP with organizational performance and identify gaps where improvement can be made.
According to Brandon Hall Group’s research, there are many barriers to implementing a formal EVP, including:
- Lack of understading of EVP components (67%)
- Lack of executive engagement (37%)
- Budget challenges (36%)
- Lack of organizational readiness (34%)
- Lack of communication from senior leadership (31%)
Although many organizations have not yet developed a formal EVP, almost all organizations surveyed believe that the main reasons for establishing an EVP are to increase employee engagment and improve talent acquistion and retention, as shown below. Just the process of understanding, formalizing, and communicating an EVP enables organizations to address employee engagement and retention issues that surface and to develop a strong offer for candidates.
The majority of employers rank employee engagement as one of the three most important drivers of success over the next 24 months. This strong link between employee engagement and organizational performance has been well accepted by employers.
As to organizational readiness, the majority think there is either a big or moderate risk regarding their ability to attract talent and engage employees. This perception of risk is not surprising because by not having a defined and communicated formal EVP, organizations lack the foundation needed for effective talent acquisition:
- Making a strong offer
- Communicating developmental and career opportunities
- Identifying candidates who would be a good “fit” for the organization
- Authentically communicating the work culture.
Based on the organizations’ specific goals and priorities, the table below shows the EVP components rated as most important to attracting and retaining talent—with learning and development sharing the top of the list.
In terms of understanding how to manage an EVP, at least one-half of the organizations surveyed believe that focusing efforts on improving manager coaching capabilities, developing and retaining high-performing and high-potential talent, and enhancing learning and development opportunities would have the greatest impact on their EVP.
Impact of Technology on EVP
Many organizations surveyed perceive that technology tools are highly valuable for employee engagement, especially social recognition, and rewards, and at least 80 percent of respondents think the leading technology tools are at least somewhat valuable.
But the reality of technology usage conflicts with the belief that these tools can be valuable for engagement, collaboration, and EVP. When asked to describe the use of specific technology and tools, many said the tool is ugly or OK, but they avoid it.
In terms of organizations’ overall assessment of their current talent, HR, and workforce management solutions, about half find it difficult to work with these solutions or they avoid the solution all together.
This difficulty in using the core HCM technology systems in place has a profound impact on the employer brand, employee engagement, and the EVP foundation. Instead of contributing toward improving collaboration, productivity, and engagement, it has the opposite affect when employees either avoid using a solution or need to work around those solutions by asking HR and management for assistance.
- Formalize and communicate your organization’s EVP. Use the resources needed to assess, formalize, and communicate your organization’s EVP. This process will help in the formulation of your offer as an employer, the ideal candidate profile, authentic messaging to convey your organization’s culture, and strategies to improve your work environment.
- Offer opportunities for development. One of the best ways organizations can engage employees is through development opportunities, from traditional classroom learning to social learning and on-the-job training to consistent coaching and mentoring by managers. The research shows that learning and development has a major impact on EVP.
- Adopt technology that fosters employee/candidate engagement. Not all HCM technology solutions are the same. If a significant percentage of employees are avoiding or working around the technology, look to alternate solutions that foster collaboration and engagement.
Daria Friedman is the principal analyst for Talent Acquisition at Brandon Hall Group, an independent human capital management research and analyst firm, with practices in Learning and Development, Talent Management, Leadership Development, Talent Acquisition and HR/Workforce Management.