Employer Branding As A Competitive Advantage Business Essay

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Human resource managements ever changing paradigms has made large impact on the organisations the way they look at the employees . Changes in HRM prospective have been significant . HRM in it's initial days was looked upon as an essential administration function which anyone can perform without specialized knowledge f the same . Introduction of more employee oriented practises made people lead up to understand not only its significance but contribution in changing the way organisations operated . Significant studies have been done on looking at various human resource practises in terms of defining on the line of contributions by various HRM systems. But the changing times brought this essential back office function to front it was no more just keeping records , it became the face of the organisations not only to retain talent but also for branding your organisation. Employer branding is one such new concept and it is changing the way human resource practises are looked at.With the change in the workforce & the increase in the demographic dividend of our country, the hunt for the talented workforce is emerging as an important aspect for any organization. Among the criteria such as market position of the company, career growth, compensation, it is actually the image that an organization reflects among its existing employees as well the potential employees that has started to matter for the young and emerging workforce of India, as well as the present workforce who has potential to progress and build a strong foundation for a step forward. Brett Minchington defines Employer branding as "the image of the organization as a 'great place to work' in the minds of current employees and key stakeholders in the external market (active and passive candidates, clients, customers and other key stakeholders)." Employer branding is about capturing the essence of a company in a way that engages employees and stakeholders. It expresses an organization's "value proposition" - the entirety of the organizations culture, systems, attitudes, and employee relationship.

Our studies is initiated from a brief study that we took earlier for banking , education and hospital sector for need of employer branding. This work further moves on to what companies are doing to make a good employer brand by following good HR practises and how human resource management is adding new feathers into companies by creating a positive image thus taking care of talent management issues as well.

Key words- Human resource practises, Employer branding , Employee., Talent.


Human resource management (HRM) has not been looked upon as the most innovative or most aspired function of an organisation. With few changes here and there Human resources (HR) has been limited to more of its administration function and never came as function which may give competitive advantage as its related fields like financial management, operations or managerial strategies. Human resource has never been looked upon as a strategy. One of the most important duties of the modern managers is to get things done through people. Human resources are heterogeneous. They consist of many different individuals, each of whom has a unique personality, a combination of different emotional responses to different stimuli and different values. The most significant resource of any organisation is its people, such claims appear in organisations' annual reports and mission statements. Of course an organisation is nothing but a group of people whose activities have been planned and coordinated to meet organisational objectives. The aim of the paper is to first look at human resource management in the changing perspective which according to the authors is influenced by seven factors (they are not limited to just seven factors, but are predominant). Further we look at how these influences have made Human resource a more demanding aspect for an organisation and why in it Employer branding matters. In the end we have concluded that why Employer branding will be most important factor in aiding Human resource contribute in a strategic manner.

"Quo Vadis"- a Latin phrase literally translates into 'Where are you going?' It is a very pertinent question that the HR function needs to ask itself today- as it finds in a dilemma where it is leading. The function in its evolution has been trying to evolve into a more meaningful role. As a function, HR is clearly the most misunderstood function in the corporate world. HR means different things to different people. For some,it is a function called human resource. For others, it is another name for people - we are all human resources. Yet for others, it is the way humans are managed so that they become effective "resources".HR function (defined as both the department itself and the domain of activities that we call HR) is an organizational resource that can, and should, contribute to firm-level competitive advantage and value creation. The HR function has transformed its focus from the administration to management of human resources to the development and maintenance of organizational effectiveness.Human resources are the source of achieving competitive advantage because of its capability to convert the other resources (the three Ms, Machine, Methods and Material) in a desired output for a required organisation. We may like it not but human resources deal with have the most challenging aspect of having the resources that make difference between companies, the people.A competitor can imitate other resources like technology and capital but the human resource are unique. But it is ever changing and within the last decade Human resource management has undergone lot of changes which we are discussing as seven influences.

The SEVEN "Influences" On Changing Human Resource management

First influence human Resources are influenced by many aspects by ever changing contribution form academics as well as the changing requirements of organisations. The training programmes and use of various psychometric instruments have led to identification of various needs of employee influencewhich is further contributed by behavioural research done. Organization behavior's contribution towards changing human needs in organizations has lead to new initiatives in human resources

The second influence has been the rise of the service industry. Company heads of firms like Future group, Tata industries believes that it is impossible for customers to not relate the product to the employee of the firm and there is always an intangible associated with it. Thus a totally different level of relationship was required by organizations towards the employees as well in terms of projection the organization makes of its internal customers . Companies held the opinion that business success depended on employees being treated well, feeling appreciated, and conveying that appreciation to the customers they served.

A third influence has been Globalization and India holds its own story post liberalisation. It has not been just the economic liberalisation, but it has also lead to liberalisation for people's aspirations and in terms of customers it has increased the demand ,as they have many options available which lead to companies for looking for continuous improvement and the employee become the biggest strength of the employers. As employers responded to the challenge, it became apparent to them that the people who actually produced their products and services were well qualified to redesign and improve them and they need to keep in mind the local context . Thus work teams from cross functions and other methods of collaboration gained popularity from the outstanding results they achieved in company after company.

A fourth influence has been the rise in importance of intellectual capital which is relatively too valuable for any employer. Secondly the knowledge workers are well aware of their contribution thus they can easily move from one oragnisation to another ,where organizations are in lurch of such knowledge workers who give them the edge in work . Their freedom of movement makes them far less likely to remain in a work environment that is not employee-friendly; employers needing their services have had to respond.

A fifth influence has been the proliferationof legislation that regulates so many facets of the employment relationship. And as the value of inspired employees has become clearer, the long-standing notion that employees must adapt to the workplace is being replaced by the belief that the workplace should begin to adapt to employees. The increasing popularity of work-life programs during last decade or so also emphasize on this point as well.We need to keep in mind the workforce is also getting diverse thus companies need to cater to all different needs as well.

Sixth Influence is HR becoming a strategy, with all the talent wars and ,aim to having top stars in the company which can give the deliverables. HR is becoming a strategy for organisations to get the most people. HR is the tool to get the people who will come out with results , contributions not only in terms of domain expertise but also in terms of contribute from leadership values , work ethics and also know how to manage complex matters gained in their experience.

Seventh influence is that HR is rapidly changing. It is no longer strangled to the defined cores of administration and now with companies who are looking for innovation; have not spared any chances to bring those incremental changes in the work domain through HR and we are not talking just about QWL issues but a totally new relook at policies form working at home to innovative sabbatical,cross functional support for research projects etc.

Why employer branding is the Answer

As the war for talent intensifies most companies have put in some system of exitinterviews to find out why people leave them. But few will ask why they would wish to stay in the company. Fewer still will full leverage the very reason they might be staying.Despite the historically weak links between the marketing and HR functions, there is a growing realisation by companies and by HR professional bodies such as the CIPD and the US-based Society of Human Resource Management (SHRM) that aligning the external, corporate image of organizations with internal employee identity or engagement provides a key opportunity for HR to earn greater voice in business. This is especially so given the importance to many international companies of global branding and the role that branding and branding communications plays in strategic decision-making and such functional alignment can be viewed as part of the globalisation process. Perhaps even more compelling, as organizations in most parts of the developed world have to compete more vigorously in the 'war for talent', especially for increasingly rare and expensive knowledge workers (Cairncross, 2003), becoming an 'employer of choice' is a central HR and business imperative (Pfeffer, 1998).An organisation may not know what may be the reasons that people may wish to stay with them.Organisations which are able to understand and clearly communicate to potential employees why they should join, and to existing employees why they should stay are said to have a strong employer brand.However, communication is counter- productive if it is used merely as an inducement with all the attention on the relationship between HR and business strategy, it is time to clarify the roles HR professional plays in this relationship. The criteria for defining HR roles has varied from a focus on activities (what HR People do) to time (where do HR people spend time)to metaphors to value creation (what value do HR people create). According to Schuler (1994) linking HR strategy and business strategy is a major role for human resources today. To accomplish this, HR needs to spend time understanding the business strategy, competitors, and technologies. Customers to help the firm gain a competitive advantage using HR practises, design a set of HR practises and activities that link with each other and link with the needs of the business and become more customer focussed. Ulrich (1993) assert that HR needs to add value by acting as a partner with line management.

HR practices are the primary means by which firms can influence and shape the skills, attitudes and behaviour of individuals to do their work and thus achieve organisational goals (Collins and Clark, 2003; Martinsons 1995). Previous literatures have paid attention to the links of HR practises and organisations outcomes such as productivity, flexibly and performance. (Delery and Doty, 1996, Pfeffer 1998, Collins and Clark, 2003).But now organisations are looking for innovation and to leverage that human capital is to be developed to create new products and services by the people. Thus HR needs to relook at itself.

In today's competitive business environment, skills and talent shortages require new staffing and retention strategies. As highlighted in the 2007-08 trends list from SHRM, one such strategy is the increased organizational focus on employer branding. For better recognition and economic gain in the marketplace, organisations develop a distinctive brand while the purpose of employee brand is multi-faceted, HR professionals increasingly use the employer brand to attract recruit and retaintalent. New research on employer branding,conducted by SHRM , finds that HR professional reports a positive impact of the employer brand on recruitment and retention. In fact 61% of companies now have an employer brand and 25% either recently developed their employer brand or are planning to do so within the next 12 months. According to SHRM the three key points for an effective brand needs to be holistic, it should be known and thrown throughout the company, it should be known in the employment market place. If we need to define employer brand it will have

The internalised sum of impressions about an organisation as a place to work

It represents an organisation's core values,attributes and personality

It describes what it is about the company that delivers fulfilment and satisfaction to employees

It is a position that supports the company's corporate brand

It is a position that differentiates one company from another

Organisations are striving to create differentiation in the minds of employees. "We are different." Communicating to employees about the Employer Brand is important because if employees connect emotionally with the organisation and what it stands for they are more likely to passionately believe in its products and services. Organisations are employing various means to communicate their employer brand. For E.g In employee meetings at RMSI employees are invited to share their experiences in RMSIthat reflect upon the extent to which RMSI is living its Employer brand. Employer brandis also built through stories, for example, stories about their CEO (an IIT & Stanford graduate), his wanting to return to India to prove himself in his country, his starting out ofa basement, his unwillingness to pay the bribe in the pre-liberalization era of Indianeconomy are known to everyone in the organisation. Beyond informing and motivating employees and incorporating some measure of relevant incentives and support, there is the issue of what the brand is.How is corporate brand being responded? What will it stand for? What does the brand promise? What values are inherent in the brand and how will it all be determined.Employer brand attributes are often expressed as core valuesrather than technical or functional attributes which might appeal to a limited set ofpeople.Brand positioning is about overall reputation, goodwill and perception of yourorganization in the talent market and how your brand is viewed by potential employees(and existing employees) vis-à-vis other Employer brands. Brand positioning is created through advertising, participating in career fairs and campus recruitments, eRecruitment, open days, internet website &market perceptions. Brand promise or the employee value proposition is communicated on a continuous basis to existing employees and through job advertisements, interviewing style, recruitmentoffers, career fairs, pre-placement talks etc. to potential employees. SHRM research on employer branding found that organisational culture is a keen variable in both recruiting and retaining talents. Individuals join and stay with a company when they identify with the organisation's mission, vision and values. It is the cultural fit that either draws or repels candidate. The research revealed that the top three factors that influence recruiting are corporate core values, a team based structure and reputation as an employees' choice. For retention, the top three factors are also corporate core values and a team based culture followed by human resources and practices. Other components organisation values play a role in staffing management practice of the company.

So how are companies creating that internal Brand?

A key HR(Human resources) role is to raise awareness of the employer brand, such as through recruitment advertisements, the company web site, and community events. From the company reputation to the routine experience in the workplace (i.e. getting paid on time, health benefits being accurately possessed, timely reimbursement). There are many mechanisms which may come in picture to make things happen and it can be at various level based upon our secondary research we look at how few companies in various segments irrespective ofthe sector, and are constantly putting in efforts for creation of employer brand by using HR mechanisms and investing in Human resources. Thus ensuring the internal brand is recognised by the employees and even when they leave the organisation. The company may gain in terms of gaining positive talent as they had positive outlook.Employer brand is used for having organisational culture and employee fit, positive outcomes and retaining talent with corporate values and team based culture. Employer brand should be a long term strategy with a transparent message that promotes the organization of choice. In accordance to create such an employer brand companiesspend a lot on their HR. According to SAIL HR survey companies spend around 0.84%to 11.1 % on people management of their budget and companies can vary as much from PSU like HPCL to manufacturing mini giant like Moser baer.

The innovations in HR can be very unique starting from PMS( Performance management Systems) systems, Recruitment systems, Career development and now a day CSR (Corporate Social Responsibility) where amalgamation of values and the systems are there to ensure a complete unique development of the employee and the brand itself. We in our studies have included few of such practices delivered by organisations which give them unique internal brand by having good HR practices.

Performance management practises - Honeywell has unique mechanisms of having "Growth files" which is issued to employees to keep track on performance on day to day basis and record achievements in the same, Indian Oil has a unique approach of defining KRAs(Key Response Areas) by firm business scorecard and KPIs (Key Performance Indicators). In case of TATA motors the individual's goals are cascaded according to company strategy. Or something very unique like Tamilnadu paper mill limited which has a "Bottom Up approach" to furnish the logistic requirements.

Competency Mapping- In organisation with well-developed HR practices competence mapping existed even thought it was informal. By highlighting the key success factors and triggers for each role, thereby leading to superior performance of the entire organisation, so an organisation like HPCL has technical competency written test whether the person can fit into the organisation or not or like TATA; they develop the competency according to the leadership values.

Women Employee practices and inclusive practises- Organisations are changing rapidly and so is the workforce diversity. Women are becoming major part of this workforce and the employees need to take care of their needs at different level. So an organisation like Indian oil started with "Gender Budgeting" which involves allocation of budgets for specifically women. At JSW( Jindal Steels) women are trained for any eventuality and they are given hands on approach on Shopfloor, at HPCL(Hindustan Petroleum Corporation Limited) women are encouraged to be part of team of internal assessors and also in personality enhancement sessions.Honeywell India promotes telecommuting and flexible timings. Companieslike NTPC has strict rule of not allowing women to stay beyond 6 o'clock. Honeywell India has a unique practice of having speak up intiative so every employee can voice and raise there concerns .

Rewards and recognitions - Organisations choose between a variety of rewards and recognitions to boost employee morale. The rewards and recognitions can be not only for the individual performance but also for team performance and achievement of organisation goals. So JSPL has instituted a SMILE award given to different teams from different unit for working in harmony to achieve organisation goals. NTPC has an initiatives like: Business minds"which help them develop strategic skills as well as expose participants to real time business situations. ITW signode has an initiative like "Dream project" to encourage employees, vendors, distributors to come out with projects and ideas which are in line with the company's growth plans and strategic outlinks . Maruti has a unique programme of "Your own car" for the company provides for 100 % payment of your car through third party financing if your an high performer. JSPL has two mechanisms to reward suggestions" MeraSujhav" and "Young Thinkers" awards to ideas which have got implementation feasibility.

Welfare - Going beyond what is mandated by law, many organisations provide benefits and services to their employees,their families and in many cases the community at large that most cases is to support employees in their needs for health, safety, housing, recreation etc. The practices can have various impacts as providing transport facilities as it will also increase the social interaction among the employees. Organisations are concentrating on self-development of people not just in terms of leadership program but also in terms of continuing education and reading material as well. Mechanisms are there to ensure children and family development as well.

Induction and Integration processes - It is through the process of induction that organisations communicate essentials about the organisations,its products, policies and procedures the environment and context of the work, and the values of an organisation. Expectations from employees both behavioural and work related are made explicit during induction and integration. Dabur has a unique belief to convert "Strangers" into "stakeholders" which will start with an interactive web based introduction, followed by personal customised inductionschedule for entrants and face to face meeting with HR. Honeywell India has exceptional way of introducing its newcomers by Turbo News which is sent Globally via email. There are initiatives like srujan, Welcome on deck for laterals etc. to give a good idea of what the organisations is all about. And companies now in view of improving upon the induction program itself are getting feedbacks on the recruits themselves os you have something NEAM( New Employee Assimilation meeting ) at ITW signode where they share feedback ,suggestions and learning from previous organisations as well.

Assessment for development and potential Act-up (Accelerated competency tracking and up gradation programme) conducted by external consultants to identify the top talents of an organization like JSW . Google has an interesting policy that they not just look at your technical competencies but also your people competencies as well. The company is not always looking for smartest candidates but for people who can don theculture. An interesting practice is to get interviewed by your juniors. And that except the massage centres, food centres, and colourful and fun filled offices; whereeven the toilets can be representation of the entrepreneurial spirit of people as employees working style can be found out on the door. With a more friend referred inclusion in organisation the transaction on the organisation is easier and sure shot talent is coming to the company. At TATA people get opportunity to even join the TATA business excellence model to show case there talent and leadership development initiatives.

CSR (Corporate social responsibility) -Traditionally companies in India have had philanthropic and community programmes. As highlighted in the book Corporate Social Responsibility in India, as Indian organisations move into the international marketplace, it is imperative to integrate CSR into company business goals. Indian companies growing global coupled with social economic and regulatory pressures there is a shift from corporate philanthropy to Corporate Social Investment (CSI) which can be in terms of taking initiatives at the company level or encouraging employee volunteerism within the organisation.In Indian context CSR has been found to increase the ability to attract and retain employees. It has been clearly mentioned in study by SHRM, CSR pilot study 2007 shows CSR increases improved employee morale,increased brand recognition, positive financial bottom line thusinitiatives at the level by SMEs like Husk power system and volunteerism programs from banks like Standard Chartered make them grow in different directions altogether and thus giving different meaning to employer branding, with initiatives driving people to various society oriented segments also like social entrepreneurship initiatives etc.


One of the key roles of HR professional is to articulate the needs of the organisation with reference to branding and put together a system to deliver the promises. In developing the brand the role of HR can also be of a facilitator in order to bring about necessary marketing imperatives of the brand and to also incorporate the employer brand. The employer brand must be genuine.It is not simply a recruiting tool. The Brand may encourage the employee to choose your company, but only if it is genuine brand he/she will have reasons to stay with the company.The problem with such kind of employer branding initiatives is you need to sustain it no matter what may be the generation they are attracted to do what kind of work they do and it makes it necessary to give them exposure at various levels. The employer brand is not just for the big glamorous MNCs with their own high prolific consumer brand. Employer brands as strategic HR tool, are for every local authority, charity,SME, government department and academic organisations that needs to recruit, regain,retain and engage good people.Employees should be involved in developing/refurbishing the employer brand with a 360 degree view of all potential target stakeholders. The HR challenge is to handle the diversity and keep them happy as well. It is important to not directly impose the global or western policies on companies without thinking about its pros and cons.Employer brand as a strategic HR tool will help organisations get the best talent in hand but they need to keep in mind how it is communicated, directed and handled as well. Successful implementation requires strong commitment and visible sponsorship from senior leaders but surprisingly, it's not the uphill push you might expect. People at most organizations show up wanting to do the right thing. They want to contribute to their organisation's success, the more closely they're able to align their behaviours to brand drivers, the more engaged they become. As engagement and empowerment are so closely linked, the empowering message at the heart of decision-based, branded leadership tends to be warmly embraced at every level. Few points that need to be kept in mind while developing an employer brand is

Every employer brand is an investment and that it should show demonstrable results and benefits as well.

Companies need to offer a holistic value proposition to various talents

Employer brand is as much about retention as it is about recruitment

One needs to keep local context in mind, being global helps not at the cost of losing your roots

The employer brand should keep in mind the sensitivities of each and every diverse group it is handling.