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Employer Branding

Free essay example:

London South Bank IHRM People Resourcing

Critically examine the impact of

national legal frameworks, with

particular reference to resourcing, on the work of international human resource managers

2528915

International Strategic Personnel & Development MHR-M-160        3

London South Bank University

Faculty of Business, Computing and information System

Term of Reference

The main focus of this report is to  explain the concept  of employer branding. How much value it adds to the organization. To examine employer branding from organizations view and to focus on the  idea of  employee living the brand  is it controlling or  unethical.

Introduction

In todays competitive markets, where companies want individuals with   the best  talent, employer brand is important  when compared to various  factors like Job profile  and the reward and benefit package.

A strong employer brand attracts better applicants (Collins and Stevens, 2002; Slaughter et al., 2004) and shapes their expectations about their employment (Lievens and Highhouse, 2003).

Employer brand is the image of an organization as a great place to work in the minds of its current employees and key stakeholder.

An employer brand represents the core values of an organization. Companies that are considered good employers have a strong identity and an image in the marketplace.

Brands are among a firm’s most valuable assets and as a result brand management is a key activity in many firms. Although firms commonly focus their branding efforts toward developing product and corporate brands, branding can also be used in the area of human resource management.

The application of branding principles to human resource management has been termed “employer branding.” Increasingly, firms are using employer branding to attract recruits and assure that current employees are engaged in the culture and the strategy of the firm.

Employer branding is defined as “a targeted, long-term strategy to manage the awareness and perceptions of employees, potential employees, and related stakeholder with regards to a particular firm”  (Sullivan, 2004 cited in Backhaus and Tikoo, 2004). The employer brand puts forth an image showing the organization as a good place to work (Sullivan, 2004).

What is Employer Branding

First of all brand on its own as defined by  American Marketing Association, a brand is a name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them form those of the competitors. (Backhaus and Tikoo, 2004 )

A brand is more than just a sum of its component part. It embodies for the purchase or user additional attributes which whilst they might be considers by some to be intangible are still very real.( Chernatony and Malcolm McDonald, 2003).  Branding is a process, an ongoing practice where all the tangible and intangible elements that constitute a company’s image and reputation are organized and communicated. (Susan Hunt ).

 A brand may have many other meanings depending on the role it plays, the value it has and more importantly, to whom it is related. To brand owners, a brand is mainly a differentiation device: the living memory and the future of its products (Kapferer, 1997). To brand users, a brand may create an emotional bond with them which turns the brand into an icon. (Fan, 2005).

Branding  can be divided into two; external branding and internal branding.

External or consumer branding  works to influence customers’ propensity to purchase, repurchase and recommend company’s products and services. The goal of the company  is to become a product or provider of choice by manifesting key characteristics that the customer values. Customers are important to most firms, that is why the brand has to communicated well  to the customers.

Employer or internal branding is the other part of branding  aspect focusing on the employer and how effective the brand is communicated internally. Employer or internal branding works to influence employees’ propensity to be attracted to, remain with and be motivated to sustain company business objectives.

Internal branding contributes to employee retention (Ambler and Barrow, 1996) by using the brand to reinforce the concept of quality employment and thereby contributing to employee willingness to stay with the organization.

Internal branding helps create a workforce that is hard for other firms to imitate. By systematically exposing workers to the value proposition of the employer brand, the workplace culture is molded around the corporate goals, enabling the firm to achieve a unique culture focused on doing business the firm’s way. ( Backhaus and Tikoo, 2004)

External marketing of the employer brand establishes the firm as an employer of choice and thereby enables it to attract the best possible workers. The assumption is that the distinctiveness of the brand allows the firm to acquire distinctive human capital.

Employer branding is define as the process of building an identifiable and unique employer identity, and the employer brand as a concept of the firm that differentiates it from its competitors. (Backhaus and Tikoo, 2004 ).

The term employer branding suggests the differentiation of a firms’ characteristics as an employer from those of its competitors.  Ambler and Barrow (1996) define the employer brand in terms of benefits, calling it “the package of functional, economic and psychological benefits provided by employment, and identified with the employing company.” From human resource perspective employer branding is a three-step process.

 A firm develops the “value proposition” that is to be embodied in the brand. Using information about the organization’s culture, management style, qualities of current employees, current employment image, and impressions of product or service quality managers develop a concept of what particular value their company offers employees (Sullivan, 2002).

The value proposition provides the central message that is conveyed by the brand (Eisenberg et al., 2001). The firm markets the value proposition to its targeted potential employees e.g recruiting agencies.

Internal marketing  or branding of the employer brand is the third aspect of employer branding. This is important because it carries the brand “promise” made to recruits into the firm and incorporates it as part of the organizational culture (Frook, 2001).

According to to Taylor 2005, Employer branding is an idea that was developed in the last years of the twentieth century as labour markets tightened and it became harder to recruit and retain staff.  What is involved is the application of branding techniques long used in product markets to an organization’s labour markets. It is primarily concerned with improving an organization's ability to compete  for new staff, but is believed to improve retention rates and to contribute  more generally to employee commitment and motivation.

The goal  of the company is to become an employer of choice by reflecting those attributes that employees value.

Theoretical foundation and for employer branding.

Selection and review of articles were confined to the underlying theoretical foundation and a frame work of employer branding . Key theories, such as resource-based view of the firm were explored.

Resource-based view  came into prominence in the early 1990s and provided a view of the firm that is more in tune with the shifting environment of global competition. Proponents of RBV have stated that a firm develops competitive advantage by not only acquiring, but also developing,combining,and effectively deploying,its physical,human,and organizational resources in ways that add unique value and are difficult for competitors to imitate (Barney, 1991, cited in Joo and Mclean 2006 Best Employer Studies: A Conceptual Model from a Literature Review and a Case Study)

According to Backhaus and Tikoo ( 2004 ), the practice of employer branding is predicated on the assumption that human capital brings value to the firm, and through skillful investment in human capital, firm performance can be enhanced.

The theory of the psychological contract and its effect on the employee organizational relationship provides a second foundation for employer branding. In the traditional concept of the psychological contract between workers and employers, workers promised loyalty to the firm in exchange for job security (Hendry and Jenkins, 1997).

The concept of brand equity provides a complementary theoretical perspective for understanding employer branding. In marketing terms, brand equity is “a set of brand assets and liabilities linked to a brand that add to or subtract from the value provided by a product or service to a firm and/or to that firm’s customers” (Aaker, 1991).

Customer based brand equity relates to the effect of brand knowledge on consumer response to the marketing of the product (Keller, 1993). In terms of employer branding, brand equity applies to the effect of brand knowledge on potential and existing employees of the firm. Employer brand equity propels potential applicants to apply.

The Importance of Employer Branding

Looking at the importance form the external view , effective branding is universally recognized to be a central importance in consumer marketing strategies. A strong brand is one that consumer recognize and trust (Taylor, 2005) . A strongly branded product than one that is just as good in terms of quality and price, but less effectively branded.A strong  brand like Apple Mac computers, its brand image is what makes it successful and able to maintain growth in the market.

Brands are very valuable to producers,  From the firm  perspective strong brand  provide numerous financial rewards to firms and it is the top priority for firms. It is use a competitive advantage over competitor; the brand help to differentiate a product or service from other being offered by competitors.

From marketing manager  perspectives, brand also serves a competitive advantage and most importantly customers are loyal to the brands, reducing the likely hood that they will switch to products or service offered by competitors.In terms of cost on advertising, less  money is spent on advertising when there is already a strong brand recognition. (Taylor, 2005).

Brand can be seen as a business assets,   The brand is said to be a company intangible and that it generates a value.Brand value is the value of the additional cash-flows generated by a product because it is identified with its brand. (Calderón et al, 1997: Doyle, 1995).

Brands some times fail if the cost of maintenance is high. Maintaining a strong brand can be costly, the company wants the brand to have a strong presence and also want customers to to aware and exposed to it, this would involve a lot of advertising  and PR and this marketing communications are costly.

The aim of most organizations to  develop and maintain a strong brand  image , brands have certain image but if a company is known to be selling just one product, they might have problem to sell another.  The importance of external branding in securing customer loyalty is well documented.

Employer branding  apply same principle of external branding to the field of employment and to the labour market. From the internal point, research  clearly shows internal branding is an important driver of external brand success. Internal branding helps to feed that employer-of-choice status that keeps the system in balance.

Employer branding is useful for organizations that do not have a strong corporate brand. Brands like Virgin , Dyson can benefit form employer branding because of their strong brand image  and they are successful. But for smaller organizations, who consumers are not really aware of and want to gain advantage in the labour market, they  can gain benefit by thinking strategically about their position in the labour market and using branding as a means of improving it.

A well design strong employer brand   attract suitable candidates for employment. differences.. An employer brand provides job applicants with a realistic image of what it would be like to work in a particular company. It encompasses all the factors that make the company a good place to work. These might include: bright and cheerful office space,  and flexible working hours.

It is not just that a firm has a good office space, by  doing these things, an employer demonstrates a people-centered philosophy that shows employees they are valued individuals, not just fodder to keep the corporate beast satisfied.

A good employer brand has another important function: retention. Attracting good employees is one thing but holding on to them is even more important.

A recent survey indicated that about 40 percent of all employees are either actively planning to move jobs or are strongly considering doing so. An employer brand, where the image reflects the reality is a good way to keep key staff.

 a strong employer brand helps to differentiate your organization within an increasingly competitive employment market. By earning a reputation for sustaining the same values internally as your brand promises externally, or simply by creating a highly recognizable internal brand.

Employer branding should in act be seen as only one part of a wider process through which organizations seek to build and maintain a strong reputation in the world generally.

Employees Living the brand

According to Ind (2001),  Living the brand is about how organizations empower and enthuse their employees. Organizations' need to build meaning into ideas so that employees can guilty live the brand in their day to day lives.  This is important if business want to make best use of the intellectual resources of all their employees; to capture the most innovative ideas; to build strong and lasting relationships with customers; to use the enthusiasm and imagination of people.

To  help confront the issue if the value of brand is effective within the organization, there needs to be systems of measurements that demonstrate the benefit of undertaking what can be expensive and time consuming programmes. If a brand is to achieve real status, there needs to be ongoing commitment to sustaining and evaluating it.

To understand how employees see the brand and its relevance to their day-to-day working lives, ongoing research needs to be conducted. This will help to determine the strength and relevance of the brand and know any ares of weakness.

Organizations have to define their brand identity  by working out what features of the employee experiences are appreciated and what differentiate and employer from competitors. All what organizations need to do is to construct a system that allows identification with the brand and also there has to be the recognition that aspirations and recognition can change.

According to Ind,  this is especially true if the identification with a team or business unit donates the corporate or if there is a major structural  change as a merger or alliance. Then the people may criticize their identification with the brand. This can result  to the individual living and search for  abetter one this can be damaging to the organization.

Employees play important role in brand formation. There is a direct link between how employees perceive the company and how they help deliver  external brand promises.  The only way to align employee perceptions is to communicate the brand so employees can understand and know that they share the underlying values.

The best way to develop a brand that has a high degree of relevance and consistency is to ensure that the employees  of an organizations understand and believe in the values of the organizations. (Ind, 2001)

In conclusion most researchers have emphasized on value which is what most organizations need from the employee to  support the firms value and be committed  to the firm. But  Placing this  values in appropriate relative positions  can  be a problem for managers in organizations.

Employees will view the whole concept of living the brand as controlling. Employees values can be moulded to a degree but they cannot be directed or rather controlled.

In the attempt of  going into this direction, uncomfortable feeling about manipulation can arise. These employees will view this as been autocratic, people are told what to do.  Employees  won't see this as associated with the business. (Ind, 2001)

The idea of  engaging  employees may seem a simple one but it is hard to achieve in practice because it cannot be ordered or controlled. (Ind, 2001).

References

  1. Nicholas Ind , 2001. Living the Brand; How to Transform every member of your organisation into a brand champion  . 1st ed. London: Kogan Page.
  2. Taylor S. , 2005. People Resourcing . 3rd ed. London: Chartered Institute of Personnel and Development.
  3. De Chernatony, L. McDonald  M., 2003. Creating powerful brands . 3rd  ed. London: Oxford : Butterworth-Heinemann.
  4. Kristin Backhaus and Surinder Tikoo , 2004. Conceptualizing and researching employer branding . Career Development International , 5 (9),  501-507.
  5. Kevin Lane Keller, 2001. Building Customer- Based Brand Equity: A Blueprint for Creating Strong Brands. Marketing Science Institute.
  6. Haydeé Calderón, Amparo Cervera and Alejandro Mollá, 1997. Brand assessment: a key element of marketing strategy . Joutal of Product and Brand Mnagement, 6 (5),  293-304.
  7. Ying Fan Brunel Business School, Brunel University, Uxbridge, UK , 2005. Ethical branding and corporate reputation . Corporate Communications: An International Journal , 10 (4),  341-350.
  8. Author Unknown, 2007. Better than Brand X; Brand image plays an important role in the recruitment and retention of staff . [PDF]. HUMAN RESOURCE MANAGEMENT INTERNATIONAL DIGEST , 15 (3).Available from: www.emrald.com [accessed 22/ 03/2009].
  9. Author Unknwon 2007. Brand survival: Do brands really last forever?. [PDF]. STRATEGIC DIRECTION , 23 (3).Available from:  www.emrald.com [accessed 22/03/2009]
  10. JOO B. MCLEAN G. N., 2006. Best Employer Studies: A Conceptual Model from a Literature Review and a Case Study. [PDF]. Human Resource Development Review, 5 (2),  June.Available from: www.sagepublications.com[accessed 23/03/2009].
  11. Susan Hunt, Chapter 7 The Importance of Employer Branding . [PDF]. Sun Life Financial with Rob Landry  Magna International, Available from: www.sunlife.ca/static/canada/Customer%20Solutions/thefutureofwork/pdf/ chapter7.pdf -[accessed 21/03/2009].
  12. Unknown Author, Building Employer Brand. [Webpage] Available from: http://www.naukrihub.com/hr-today/employer-brand-building.html[accessed Wednesday, 25 March 2009].

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