Aligning benefits with your Employee Value Proposition
I think that’s a rather eloquent expression of an Employee Value Proposition (EVP), right?
Even if you think there is a better definition out there, the question of why you should have an EVP remains. To answer that, it’s worth looking back in time, to the evolution of the relationship between employers and their employees.
The evolution of the relationship with employees
There was a point before the late 90s and early 00s when terms like Human Capital Management weren’t commonly used. And it is easy to understand why. Socio-economic conditions were very different, with social and job mobility, general education levels and market freedoms less than they are today.
In fact, it was back in 1997 that McKinsey coined the phrase “war for talent”, which really identified the start of the race, at least in key sectors, for attracting and retaining talent within organisations.
That starter pistol signalled the shift in power from employers to employees, who were in demand more than ever, especially where their skillset was rare. The biggest war for talent opened up in banking and technology.
With increasing compensation offers and reducing average tenure, the cost of hiring and firing talent was escalating quickly, and employers were being asked to justify why the candidate should take the role. Thus the concept of EVP was born.
To put more meat on the bones, EVPs were defined (by Joseph DiVanna, amongst others) as:
“A statement of why the total work experience at that organisation is superior to that at other organisations. It should demonstrate the organisation's commitment to employee growth, management development, employee recognition and more. Contained within the value proposition should be all the central reasons that people will choose to commit themselves to an organisation.”
Interestingly, when it was first coined, these statements were focused on the relationship between the employer and the employee, to the exclusion of other factors.
As they have developed, especially in the late 2010s and early 2020s, that dynamic has broadened to consider other parties, including the social purpose and community role of the employer in demonstrating their values and purpose, and how that contributes to the employee’s desire to work for them.
Are EVPs still relevant today?
The name may change – some companies now call it their ‘deal’ or ‘people deal’ – but their importance remains. More than ever, employees (candidates/talent) are asking the big questions about whether they want to work at one company or another. And their expectations are higher and broader than ever.
With such expectations, the question might be whether benefits are worthy of hitting the EVP agenda?
It would be fair to say that, perhaps 10 years ago, when EVPs were reward-orientated, employee benefits would be lost within reward strategy. Today, however, with wellbeing, culture, work-life integration, social and environmental responsibility all towards the top of the CEO agenda, let alone the employee agenda, benefits need to be front and centre.
From social purpose, charity and volunteering programmes, to authenticity of leadership regarding the work environment, respect, diversity and wellbeing, these are all fundamental pillars of EVP that employees are looking for, which are rooted in benefits and wellbeing strategies.
The key message from us is, in terms of positioning benefits within EVP, it isn’t about products, it’s about values – what the company believes in, for today and tomorrow, for employees, customers and the wider community. This is the new role of the EVP and how benefits are perfectly placed within them.
To steal another great saying from Mr Sinek, “People don’t buy what you do, they buy why you do it. What you do simply proves what you believe.” Surely that is why you offer benefits – it’s not the what (pensions, insurance etc), it is the why – to support people’s financial aspirations, their health goals and help them perform at their very best.
The author is Matthew Gregson, head of corporate at Howden Employee Benefits & Wellbeing.
This article is provided by Howden Employee Benefits & Wellbeing.
In partnership with Howden Employee Benefits
Howden provides insurance broking, risk management and claims consulting services, globally. We work with clients of all sizes to provide dedicated employee benefits & wellbeing consultancy.
