Investing in Your Employer Brand and Employee Value Proposition Makes a Bottom-Line Difference

 

Many companies say their people make the difference. And it’s true. Research by the National Center for the Middle Market reveals that time and again, middle market companies with top talent perform substantially better than their peers. This post shows how a strong employer brand and employee value proposition (EVP) are tied to middle market company performance and growth.

In a recent study of senior and executive-level talent, the Center looked at how employer brand and EVP—two critical assets for attracting talent—correlate to overall performance, top-line growth, and job growth in middle market companies. We divided the firms into three categories:

  1. Firms with well-established employer brands and EVPs.
  2. Firms with employer brands and EVPs that need more work.
  3. Firms that have made minimal to no progress developing their employer brands and EVPs.

The results are telling: companies in category number one—those that have a good reputation as a place to work and that invest in rewarding their employees with a well-rounded package of both tangible and intangible benefits—have a clear edge over the other two groups.

Here’s a closer look at what the research shows:

An established employer brand is strongly tied to improved performance and growth.

About a quarter of middle market firms say they have an effective employer brand—or image and reputation as a good place to work. More than eight in 10 of these firms say that an employer brand is essential to securing top talent.

Beyond closing the deal with a candidate, firms with the best reputations also experience better bottom-line results: 71% of these firms say their company performance improved over the last year, compared to just 55% of firms with an employer brand that needs work.

But having a brand that needs work is better than having a neglected or negative brand. Only 45% of middle market companies with the least developed employer brands reported improved performance over the last 12 months, and 14% of these companies said their past-year performance actually deteriorated.

In terms of revenue growth and employment growth, the firms with the best employer brands far exceeded the other two groups, reporting an impressive mean revenue growth of 20.1% and employment growth of 12.3% over the past year. These results are more than double the revenue growth and almost triple the employment growth experienced by companies with employer brands that need work. Clearly, putting in the time to polish an employer brand and take it to the next level pays off.

 

A compelling employee value proposition drives revenue and employment growth.

Like an employer brand, an employee value proposition—or the sum total of benefits and rewards an employee receives in return for working for a firm—is clearly tied to attracting the best talent and generating results.

Companies that have established EVPs perform somewhat better than those with EVPs that need work; but both of these groups are significantly more likely to report improved past-year performance than companies with the least developed EVPs.

Additionally, firms with the best EVPs enjoy significantly greater mean revenue growth and employment growth than their counterparts. Their bottom lines grew more than one and half times and they added nearly twice the number of employees than middle marked companies with EVPs that need more work. As with employer brand, investing the time to fine-tune a value proposition can deliver a hefty return.

 

The effort is well worth the rewards.

Employer brand and employee value proposition are clearly two powerful assets for middle market firms. And fortunately, they don’t require much or any money to develop. But they do take time and a real commitment from senior management.

If your business is ready to put in the effort, you can learn more about how to create and use an effective employer brand and EVP in the Center’s top talent research report, Building the Top Team: How Middle Market Firms Attract and Retain the Top Talent that Fuels Their Success.

Six Steps to a Successful Employer Brand and Employee Value Proposition. View Infographic >

Take a deeper look at how your company can build a team of top talent with these 11 steps. View Infographic >


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