The profit v engagement paradox

Original employer branding article published in South Africa's HR Future and New Zealand's Human Resources Magazine

Have you read Brett's new book "Employer Brand Leadership - A Global Perspective?" For full details please visit the publisher's website click here>

The Profit v Engagement Paradox

Optimising employee engagement has been a common objective of companies over the past five years. This shift in focus has been driven by a more informed view on the relationship between employee/customer engagement and profit.

Studies by global consulting firms such as Gallup, ISR and Hewitt have shown higher levels of employee engagement lead to higher sales revenues and profits. One of the most well know examples that demonstrated this relationship is Sears who used an ‘employee-customer-profit chain’ to analyse aggregated data from 800 stores, finding that employee attitudes towards their company and their jobs lead to positive employee behaviours toward customers. Sears found that a five percent increase in employee satisfaction drives a 1.3 percent in customer satisfaction, which results in 0.5 percent increase in revenue growth.

Studies also show higher levels of customer engagement lead to stronger financial performance. A 2009 study by Wetpaint and Altimeter Group found companies that are both deeply and widely engaged in social media surpass their peers in terms of both revenue and profit performance by a significant difference. The study found Mavens (defined as brands that are engaged in seven or more channels and have an above-average engagement score) had significantly higher revenue growth, gross margin growth and net margin growth over the previous 12 month period compared to their peers that engaged in fewer channels and had below-average engagement scores.

The Profit & Engagement Matrix
The main objective of a company is to maximise profit whether this is measured in financial outcomes (e.g. private and publicly listed sector) or social good (e.g. not-for-profit and Non-Government Organisation (NGO) sector) or a combination of both (e.g. Government sector)

To encourage companies to define their strategic focus and develop strategy that achieves a better balance between profit and engagement objectives I developed The Profit & Engagement Matrix.

The framework will assist leaders to develop strategies that consider the needs of all stakeholders and do not favour one (e.g. shareholders) at the expense of others (e.g. employees). The framework can also be used as part of the strategic review process to assist leaders to better understand when and where profit, and employee/customer engagement trade-offs will need to be made based on the strategic priorities of the company at the time.

Building employer brand equity

This article provides some insights into "Building employer brand equity as featured in Brett's new book Employer Brand Leadership - A Global Perspective.

Original employer branding article published in South Africa's HR Future Magazine

A company has one brand and the art and science of employer branding provides a focus for the role of the ‘employee’ in building brand equity.

In addressing the challenge of measuring the ROI of your employer brand strategy your approach can be informed by previous research in marketing, specifically in the area of brand image and brand equity.

Brand image
Brand associations are the determinants of brand image. Keller defines brand image as an amalgamation of the perceptions related to the product related/non-product related attributes and the functional/symbolic benefits that are encompassed in the brand associations that reside in consumer memory.

Marketing literature supports the concept that product brand equity is strengthened when the brand image resonates with the consumer. As brand awareness heightens, consumers begin to develop positive identification with the brand. The more positive the brand is perceived to be, the more highly identified the consumer becomes with the product. As social identity theory suggests, in the end, the consumer purchases the brand because of the positive self-concept that results from feeling membership with the brand. In a similar manner, as potential employees find positive aspects of the employer image, they are more likely to identify with the brand, and will more likely choose to seek membership with the organisation for the sense of heightened self-image that membership promises.

11 Employer branding best practices to focus on in 2011

Have you read Brett's new book "Employer Brand Leadership - A Global Perspective?" For full details please visit the publisher's website click here>

I've compiled a list below I wanted to share with you. The list includes 11 areas for leaders to focus their employer branding efforts on in 2011 based on some of the workforce changes we have encountered by the introduction of new technologies, global economic instability and the requirements of a modern workforce - one that is agile, adaptable and responsive to a constantly changing and highly competitive landscape.

It's great to see many more companies appointing employer brand leaders in 2010 to drive their organisation's employer brand strategy. I expect this trend to continue in 2011.

It is only with this focus will we see the continued evolution of the employer brand concept and employment offerings which on the whole, works towards achieving a much better match of the needs of employees with those of business.

Here is my top 11

1) Establish a real-time career development for employees

It’s time to get social!

Click here for the original article published in South Africa's leading HR publication, HR Future where Brett is an International monthly columnist on employer branding.

Develop your social media strategy now!

Due to its size, scope and scale potential social media have become appealing to businesses of all sizes across all industries around the world. Following a ‘wait and see’ period, companies are now seriously starting to use social media such as Facebook, Twitter, LinkedIn and YouTube to connect and interact with current and potential employees. Successful use of social media has had a positive impact on employer brand equity for companies such as Starbucks, EMC, Sodexo, Cisco, Intuit, Coca-Cola, Zappos and Microsoft.

There is little left to debate about whether or not one should participate in social media. Companies, big and small, have acknowledged social media’s presence, and firms who do not have a Facebook page, Twitter account or LinkedIn group may now find themselves well behind their competition. However it still appears top executive are leaving the work to their colleagues further down the hierarchy.

Building the brand

Original article published in HRM Asia Issue10.10

Organisations spend countless hours and dollars on their employer brands, making strong messages that prove compelling to potential recruits. But is there a critical piece of the pie that's still missing?