How to define a winning employee value proposition (EVP)

Considering the journey we’ve all been on in the last few years, it’s hardly a surprise that employees have been rethinking what they want from work. Just a few years ago, the priorities for most employees were fairly simple; salary and progression. These remain important today, but they’re not the only show in town anymore.

According to 麦肯锡 , the top four contributors to employee disengagement are:

? - Inadequate total compensation (12%)

? - Lack of meaningful work (12%)

? - Lack of workplace flexibility (11%)

? - Lack of career development and advancement (10%)

Perhaps the most surprising finding here is the fact that ‘lack of meaningful work’ is equally as damaging to employee experience as poor compensation. But this reflects wider trends recorded by the likes of Gartner in the last few years that ultimately led to The Great Resignation – and much of the volatility in the hiring market ever since. Simply put, workers have had a lot of time to reevaluate what they want from work.

Ultimately, low engagement and high attrition can impact performance as much as poor feedback or lax performance management. According to Gallup organizations with high employee engagement see an overall 23% increase in profitability, compared with the lowest-ranking organizations. This creates a key challenge for people teams: How do you improve performance without causing further attrition? This is where your employee value proposition comes in.

In effect, this is everything you can offer to improve the experience of working at your company. It‘s the unique value you provide to your employees – the reasons they first chose to accept the job and why they’ll choose to keep working with you in the future. The goal of an effective employee value proposition, therefore, is twofold; to reduce employee attrition and improve engagement. Together, these priorities will have a tangible impact on your performance metrics.

?? Improving your EVP: Where to start

But what does an effective employee value proposition look like? And how do you know if yours is any good?

The best place to start is to assess what already works well and how employees view the organization. Look at results from your employee satisfaction survey and attrition rates and compare them with recent years. This should give you an idea of how employees are feeling and what they value. If attrition is trending upwards, there’s a good chance you need to improve your employee offering.?

But before you can improve it, you first need to understand what you’re already doing well. And often, the best way to understand your EVP is the simplest: Just ask. After all, everyone at the company once accepted the job and has (so far) decided not to move on. The reasons they all chose to do so are already your EVP, you just need to take the time to understand it. By chatting with employees about how they’re feeling, what works well, and what can you do to improve, you can get a fairly detailed understanding of what you need to prioritize.

Once you’ve defined what your EVP involves, you can start taking proactive steps to improve it. There’s no right answer here; different organizations and employees will have different priorities. So take the time to discuss what’s valuable to your employees and realistic within your budget.

That being said, organizations looking to boost their employee experience generally focus on a few key areas:

??1. Salary and compensation:

Traditionally, when companies wanted to attract and retain skilled employees, there was one key lever they would pull: salary. Of course, this is still a key draw for employees – particularly in a cost of living crisis – and likely always will be. But when it comes to defining your EVP, salary is no longer the only show in town - and there are plenty of other tools at your disposal to keep employees engaged and productive.

That being said, if you have the budget to offer above-market salaries and benefits, this will form a key part of your EVP. And if you can’t justify raises at the moment, consider reviewing your incentives and bonus structures to ensure what you’re offering remains competitive.

??2. Progression and autonomy

The best employees want to learn, grow, and progress at work. Offering a clear route to progression, therefore, can make a world of difference to your EVP.

“One key element of our EVP is a big differentiator between us and a larger company, where the roles are more specific and defined. Even though there are over 700 people at Nextdoor, there are still opportunities to be on founding teams within functions we already have. That’s a key difference for some people.” - Stacey La Torre , Head of Global Talent Management & Development, Nextdoor .

The most obvious way to do this is by offering clarity around formal promotions. To do that, managers can work with their reports to identify a clear job title, portfolio, and (where possible) salary band that employees are working towards. Ideally, that should be combined with a set timescale and the targets they’ll need to hit in order to get there

But formal promotions aren't everything; there are many different forms of progression. For some, that might involve a lateral move, changing functions within the company, or getting more autonomy and responsibility within their existing roles. Many employees value the ability to own specific functions or projects, even if that doesn’t come with a change in title and job description.

In reality, there are many different types of progression, be it formal and structured or ad-hoc and flexible - there’s no one-size-fits-all solution. The key is for managers to constantly discuss career priorities with their employees and create personalized development plans where possible to help deliver them.

??3. Wellbeing, fitness, and mental health support

In the last few years, mental health and wellbeing support has soared up the list of employees’ priorities. Now as many as 81% of respondents said that employers’ support for mental health will be an important consideration when they look for work. After Covid, remote working, economic turbulence, and more – it doesn’t take a genius to work out why.

Companies are increasingly putting wellbeing and mental health support at the center of their EVP. One survey found that a third of businesses have increased their wellbeing budget since the pandemic, across the following areas:

- Tailored support to address individuals’ needs and concerns (81%)

- Increased focus on employees’ mental health (81%)

- New or better support for people working from home (72%)

Wellbeing and mental health support can take many different forms. The obvious option here is to offer subsided counseling or mental health services. This can be hugely valuable, particularly for employees in countries that don’t have widespread or affordable mental health services. But it’s not the only option available.

You could consider offering subsidized gym subscriptions, yoga/meditation classes, mindfulness, and more. Several subscription platforms, like It's Mental or Help@hand from Unum, bundle a whole range of wellbeing, fitness, and mental health benefits into one app for ease of access and use. If you want a simple way to improve your wellbeing offering, this is a great place to start.

??4. Flexible working

For many employees, flexible working has become a must in the years since Covid. While some tech companies still operate on a full-time office policy, most, in truth, have become used to a hybrid setup that mixes the best of both worlds. So how can flexible working be part of your EVP if it’s so ubiquitous?

In reality, not all flexible working arrangements are equally as attractive. Even if you have a hybrid working policy, there are several different ways you can offer employees more flexibility within it:

- Requiring fewer mandated office days or no mandated office days at all

- If operating a hybrid model, give employees the flexibility to choose which days of the week they’ll spend in the office, rather than having specific mandated office days

- Offer flexibility in working hours as well as location, allowing employees to spread their working hours across the day to fit their own working preferences and schedules. This is particularly valuable for working parents and those with other non-work responsibilities

- Let employees work from different locations – not just at home or the office. That could be a coffee shop, coworking space, or another city or country. Some companies offer a set number of ‘abroad days’ in which employees can work from another country.

The best place to start here is simple: ask your employees how they feel about your flexible working policy and how they think it could be improved. Consider prompting different options (such as those above) and ask employees to rank them in terms of preference.

??5. Learning and development

Done right, effective learning and development should have a direct impact on employees' performance. But it’s not just about the direct impact on KPIs – it should also help boost the employee experience and give people another reason to stay in their current roles.

Too often, learning and development is treated as a tick-box exercise, with employees feeling pressured to engage without seeing what’s in it for them. This contributes to shockingly low average industry L&D engagement rates of just 18-25%. In truth, L&D programs like this only make your EVP worse.

As we’ve discussed elsewhere, high-performing employees generally have pretty high expectations of their careers. The key here is to position L&D as a tool to achieve their goals as much as it is something to improve their performance. That means giving employees the flexibility to choose their own learning priorities and a wide range of resources from which to do so.

To do this, consider offering a mixture of learning resources, on-the-job development opportunities, mentoring/coaching support, and more.

?? To learn more, check out chapter 7 of our eBook - How People Teams Can Create A Performance Culture That Really Delivers

3 examples of EVPs that really break the mold

The great thing about creating your EVP is it gives you the opportunity to be really creative and unique in what you’re offering to your employees. If the goal is to attract and retain your employees, it really helps to have something that nobody else is offering.

? Shopify Inc

Shopify takes a radical approach to career development, understanding that a path to management isn’t for everybody. They have two separate development pathways , one each for managers and individual contributors. This means employees don’t have to choose between progression and doing the job that works for them.??

??Key takeaway: Clear and flexible career pathways tailored to each employee

? HubSpot

HubSpot takes radical flexibility to a new level, with a package of benefits that includes unlimited vacation, fully remote work, parental leave, and a five-year sabbatical. They also broke the mold by pioneering their ‘global week of rest ’, a dedicated company holiday for all employees to ‘take time off and recharge’.

?? Key takeaway: Radical flexibility and a ‘global week of rest’

? Hotjar | by Contentsquare

Hotjar prides itself on a truly radical package of benefits that ‘people actually want’ . The most eye-catching includes a no-strings-attached holiday budget of $2,000 dollars a year for each employee (yes, you read that right). But as well as that, there’s also a $2,500 annual home office budget, and a separate working space budget of $2,400 each year.

?? Key takeaway: Company-funded holiday budgets, home office allowances, and working spaces.

“Yeah, really. We give people money to go away. Space. Connection. Mental health. Personal growth. These are things we prioritize. And pay for.” - Hotjar