Employment Marketing Review of the Year

I have had this blog for a year, and this is an overview showing how my blogs build up a model of employment marketing. It’s also the season when everyone else is doing a Review of the Year.

The earliest articles, “What is Employment Marketing?” (Dec 2011) and “How marketing can sell your personnel product” (Jan) are blog versions of articles I had published in the mid-1990’s. These outline the idea that in HR we are marketing employment, and so marketing provides a model for everything we do.

The next January blog, “We have already got Employer Branding – isn’t that enough?” explored the difference between employment marketing and employer branding. Most HR people seem to see branding and marketing as synonymous, which is incorrect. The final January blog “What role does branding play in Employment Marketing?” explores the difference further, and analyses the different kinds of purchasing decision a consumer makes.

The early blogs had all been fairly theoretical, so February’s blog, “Solving HR problems using Employment Marketing” illustrated how employment marketing can be used on a practical tactical level.

March’s blog “What is the product behind the Employer brand?” examined the issue of the size of the employment product. For those of you who have only encountered employer branding so far, the concept of an employment product might be unfamiliar. The idea that such products could be of different sizes will probably be alien. Essentially, it comes down to whether you are selling careers within an organisation, or jobs that will form an episode in someone’s career. 

The May blog, “Was that HR ad sexist?” picked up on a job advertisement that had provoked considerable debate in the CIPD Member LinkedIn discussion group. As my blog article had a wider scope than the just sexist adverts, I republished the blog in October under the title “Targeting a segment, or indirect discrimination?”

Many articles about employer branding assume every HR person is working in a large corporation, and is aspiring to build a brand as well-known as Google. June’s blog “Too small for an employer brand?” shows how employment marketing can be used in any size of organisation.

July’s blog “”Internal recruitment” or Internal recruitment” is a little diversion away from employment marketing, trying to restore the correct use of the term. Agency recruiters will be offended, but most of them deserve to be.

For years HR people have been bleating that they are not taken seriously by organisations, and that HR must become strategic. September’s ironically- entitled “Easy ways to make HR strategic” pops a few balloons in describing some of the vacuous ways some HR people try to appear strategic. In November, I realised I had missed a favourite route to instant strategy, hence “Another way to make Human Resources strategic”.

For 2013, I plan to do more blogs on the practical application of marketing techniques to HR problems, employment marketing in a recession, and the irrelevance of brand management to the employer brand. I will continue to throw sticks into the spokes of any HR bandwagons that come too close, and will enjoy doing so.

Another way to make Human Resources strategic.

In my recent blog “Easy ways to make HR strategic” I forgot about another popular route to instant strategic Nirvana.

Get rid of the low-level activity.

This one has been a best seller with HR since the 1990’s. It’s ineffective, and irritates our colleagues intensely, but it will impress other HR people.  You look at the time-consuming routine activities of the HR department, and push them onto line managers. This move is often accompanied by earnest declarations that the task is line management’s responsibility anyway, and HR should never have taken it on in the first place.

Having dumped it on the line managers, you can now declare that you have freed up your time to concentrate on the strategic issues. It’s that simple!

In practice, it is not that simple. Let’s take sickness records as an example. You transfer that over to the line, give them some training in how to do return-to-work interviews, show them the forms, and retreat to HR to be Strategic. Six months later, some managers complain to you that they have some employees with high absence levels, and ask you to help them with a review meeting. As a first step, you ask to see the sickness record and surprise, surprise, they have stopped recording sickness absence.  You can’t help them. A year after the change, the CEO asks whether sickness absence has risen or fallen since transfer of responsibility to the line. You have no evidence to base your answer on, which will make you look incompetent, rather than strategic.

The low-level routine activity is the base of a pyramid. On top of the routine transaction of recording sickness absences ( or doing first round interviews in recruitment, or advice on employment conditions, etc) is a level of reporting and professional service. That might be advising managers on trends and employment costs, or helping managers with difficult cases. Above the level of those advising and reporting services, you can look at the bigger picture, and advise on policy. Taking away the base of the pyramid does not make the apex any higher.

If this strategy was a useful way to get strategic, what have other professional disciplines in the organisation done? They might constantly find ways of doing the low level routine more efficiently, but there always seems to be a hierarchy from strategic, through tactical, down to transactional. In Finance, the strategic issues might be about securing long-term finance, and measuring return on capital. So has the Finance Director got rid of most of his department, and pushed responsibility for cash collection, audit and treasury out to the line managers? Probably not! There is still a hierarchy of activity, with the strategic thinking at the top, supported advisory levels of management accounts, Sarbanes-Oxley compliance, audit, etc in the middle, and a lot of invoice-processing and expense claim checking at the bottom.

You will find a similar hierarchy in Marketing, with the Marketing Director occasionally thinking about “what business should we be in”, but with a department doing a lot of running small promotions and drafting press releases underneath.

This is not the road to instant strategy, but could make it easy to replace in-house HR with an occasional visit from an external HR consultant. I suggest you look at “Easy ways to make HR strategic” to find an alternative.       

Targeting a segment or indirect discrimination?

(This article appeared as my blog of 20 May 2012 under the title “Was that HR ad sexist?” The scope is much wider than sexism in advertising, so I have decided to republish under a different title. Apologies if you read the original posting, and are feeling a bit short-changed.)

 A long-running debate on the “CIPD member” Linked In form was prompted by a recruitment ad for  HR jobs that showed the above image of a man ripping his shirt open to reveal a super-hero costume underneath, with “HR” instead of a Superman logo. The text had jokey references to super- hero powers and wearing your underpants over your normal clothes.  (See the original advertisement at http://www.woodgroup-psn.com/careers/hr-hero.aspx. )

Overall opinion seemed to favour seeing the ad as an innocent use of humour, rather than intentionally sexist. The whole debate prompted another question to me; “Is targeting a sector of the labour market legitimate marketing, or indirect discrimination?”

In the UK, the law allows employers to advertise jobs in media that might be read by minority groups, if these are under-represented in your workforce. But with that limited exception, the law assumes that all other aspects of recruitment, and more importantly, employment will be on a non-discriminatory basis. Leading on from that, is there any scope for legitimate targeting of certain demographic groups that could not be viewed as discrimination?

If you have read any other of my blogs on employment marketing, you will know that the marketing of employment is a much wider topic that employer branding in recruitment.  We will use benefits policy as a starting point. Let’s assume I am in the lucky position of being able to improve the benefits package for the employees. I’ve considered the available budget, and have a choice of two initiatives to propose to senior management:-

a)      We offer free gym membership, and a “pick your own device” policy on business mobiles, allowing them to choose i-Phones, android phones, Blackberrys, etc.  OR

b)      We increase the employer contribution to the pension scheme by 1.5% of salary.

Whichever option we go for will be available to the whole workforce, but which demographic group is going to favour which? The first option is targeted to appeal to a younger age group, the pension improvement targets the older worker. If my company was operating a flexible benefits scheme there would be no problem, but assume we do not have that means of avoiding the problem.

It seems logical to choose the benefits to suit the workforce you have got. Look at the age profile, and if you have lots of young employees, go for the gym-and-phone package. If you have lots of middle-aged and older employees, the pension improvement would be welcomed. But does that approach then become a self-fulfilling prophecy? If you have a benefits policy geared to the needs of one age group, it becomes easier to recruit and retain that age group, and makes your employment product less appealing to the other.

There is probably a similar dichotomy on maternity and childcare provision between sectors that traditionally employ a high proportion of women, such as publishing and healthcare, and those that traditionally employ a low proportion of women, such as engineering. Organisations in the former sectors are likely to offer enhanced childcare and maternity benefits, whilst those in the latter are more likely to offer only the statutory minima.

Whilst most organisations will claim that they are keen to attract applicants from all sectors of the population, it will take a bigger commitment of resources to offer employment policies and benefits that would appeal to the groups that an organisation has not historically catered for. You might feel that the factors determining which demographic groups are attracted to you industry is beyond your control, and so just gear your policies to the existing workforce. ( “ Nursing will always appeal to women more than men” “Web design is a young person’s game”). It is possible to break out of the self-fulfilling prophecy, but you can’t tinker around at the edges. For example, Ford (UK) and Jaguar / Land Rover both offer a year on full pay to women taking maternity leave, a generous improvement on the UK’s statutory 6 weeks at 90% earnings, then 33 weeks on the statutory £135.45.    

Another example of targeting a sector of the workforce that has made recent news is the nationality of who serves your coffee. The Mayor of London, Boris Johnson recently complained that British workers were not getting jobs in coffee shops and those companies should do more to attract local workers ( http://www.telegraph.co.uk/news/politics/9249748/Why-do-foreigners-get-all-the-jobs-asks-Boris-Johnson.html ).

At about the same time, Pret a Manger, the coffee and sandwiches chain were publicising their recruitment and selection procedures. (http://www.peoplemanagement.co.uk/pm/articles/2002/05/6749.htm ) Most of these were sound robust and fair; competency-based interviews, and an on-the-job experience day, but the final selection process is a ballot by the existing team members. The branch manager cannot over-ride that decision. I think there might be a possibility that teams might be tempted to base “compatibility” on similarity of national or ethnic background.

I am not advocating that organisations should use targeting to exclude any particular demographic group, nor accusing any particular companies of doing so. Targeting your employment product to meet the needs of certain groups is essential to maximise your success in recruiting and retaining them. I think the principled way to use it is to define the target group initially and fundamentally by the skills that they have which your organisation needs.  If that group would prefer gym membership to a higher pension contribution from the company, then you need to respond to their priorities

“Internal recruitment” or internal recruitment?

Recently I had an (relatively) interesting ‘ phone conversation with an agency recruiter who was offering his services for one of our vacancies.

Me: “I am not using agencies on this one. I’m sure we will get a good response to our ad.”

Agency recruiter: “Oh, so you are filling it internally then.”

Me: “No, not internally. We will be appointing an external candidate, but one we have found ourselves.”

Agency recruiter: “That’s what I mean. You are recruiting internally.”

 I explained to him that internal recruitment is when we only advertise a job to our own employees, and appoint one of them. Despite the explanation, I am sure he will persist in referring to an organisation’s direct recruitment as “internal recruitment”.

Why does this matter?

The recruitment industry’s misuse of the term “internal recruitment” is harming the brand of all employers, in the eyes of some jobseekers. If you look on internet forums used by candidates, you will frequently find them complaining about employers who they believe have falsely advertised vacancies that were always intended to be given to an internal candidate. Invariably, “role filled internally” is an explanation given to them by an agency recruiter. Agency recruiters will not give the real explanation “role filled by the company’s HR department appointing an external candidate directly. You should have applied via their website, instead of through this agency”

 Why do recruitment agencies want to muddy the water by describing direct recruitment as internal recruitment?

Agencies want to keep candidates who have registered them as their ”stock”. To do this, they want to give those people the impression that they are the only recruitment channel into the organisation with a vacancy.  They will say they have been retained by the client company, even if they are one of a number of agencies that the company is using, or even if they are just submitting c.v.’s speculatively. There are agencies that will put details of positions on their websites that they have ripped off the employing company’s website without permission. They then hope to sell one of these “kidnapped” candidates to the employing company.

 How do companies see it?

As a company recruiter, what is my order of preference of the various recruitment channels? If there is a plentiful supply of candidates, my preference is to advertise directly, whether through the company website, job boards, LinkedIn or press advertising. I am then dealing directly with candidates, and finding them at lowest cost. If suitable candidates are harder to find, I will use agencies on a contingency basis, alongside direct advertising. I only do that to widen our access to  suitable candidates. Only in the case of a very specialist and/or very senior position would I put it with an executive search company, and not advertise direct.

As that is the choice of recruitment channels, where does internal recruitment fit in? In most companies I have worked for, where we had just one employee who is being promoted to a particular role, we would just appoint. Admittedly, some organisations advertise all roles as a matter of policy. Personally, if the organisation was advertising purely to technically comply with a policy, I would not contact a recruitment agency. Why not just put it on your website for a few days?

 Where we are genuinely recruiting internally, that is to say restricting applications to existing employees, there would be no external advertising and no agencies contacted. The most frequent situation is that current employees can apply to vacancies that are being advertised externally, and compete against external candidates on their own merits. If the internal candidate is successful, it is wrong to conclude that it was a bogus exercise, and the result a foregone conclusion.  

What should candidates do?

If you meet an organisation’s advertised requirements, and you want to work for them, apply direct. If you rely on an agency to submit your details to the organisation, that puts a price tag on your resume equivalent to 20% of the starting salary. Remember that the agency recruiters are not working to find you a job, neither are they working to fill my vacancies – they are working to get a fee.

Recruiting recruiters.

I think employers should reclaim the job title “internal recruiter”, which should only be used for roles that primarily involve genuine internal recruitment. There would be a very small number of those, found only in large organisations.

Many job boards and agencies specialising in HR staff refer to company recruiters as “internal recruiters”.  If you are recruiting an recruitment specialist, do not encourage them by using the phrase “internal recruiter”. Company recruiters are the real recruiters, as we actually offer the employment. Agency recruiters are just intermediaries. (And that's probably a kinder description than they usually get).   

Too small for an employer brand?

“Get an employer brand, and become the employer of first choice” That’s what everyone in HR is being told, either by the academics, or by the consultancies who specialise in employer branding. But how much resource should your organisation put into building a brand?

Is every organisation trying to be the first choice employer of the whole working population? If you are Smalltown Widget Co. are you going to get an employer brand that rivals Google? Obviously not. You need to keep a good reputation in your particular labour market, and you need to attract an adequate source of good candidates to fill your vacancies.

Most consultancies that claim to be employer branding experts focus on the visual aspects of what applicants to your company might see; logos, strap-lines, job ads and the look and feel of your website’s recruitment page.  As explained in my January blog “What role does branding play in Employment Marketing? ”, these are peripheral issues in the marketing of employment.

The most important part of getting marketing right is to have a clear definition of your target market. You can then work on getting the right marketing mix of product, price, place and promotion that will appeal to that market. For most employers, and particularly if you are a small organisation, the most important of those is the product – the job. What will they be doing in the job? What aspects of that will provide your target market with job satisfaction?  If you have not got that right, it is difficult to attract and retain employees purely through price (remuneration), place or promotion (recruitment channels and employer brand.)

Little and Large.

Big organisations often want to put less emphasis on particular jobs in their marketing, preferring to stress the wide range of career possibilities that the organisation can provide. An employer brand approach suits such organisations, and they have considerable resource to put into the brand. Often the employer branding effort will piggy-back on the strength of the company’s product/service brand.

But if you are an SME, how much effort can you usefully put into branding? I currently work for a company whose total headcount is just over 200 people. With turnover and some modest expansion, in the last two years we have needed to recruit 30 people a year. Most of those positions were in London, but some were in China, India and the US. Most of the positions were for market analysts.  We need to recruit very smart graduates, usually in economics, with excellent writing skills. This means our employment marketing objectives are to secure a reliable source of good recruits, maintain a good reputation in our specialist field, and to stay competitive in a market with about half a dozen direct competitors.  I do not need to get the company name known by the general public. I do not need to make our company the first choice for every profession from actuaries to zookeepers. I do not need a brand as recognisable as Google or Nike.  

The Corner Shop.

I think any theoretical framework for Human Resources should be universally applicable to all organisations that employ people. And for me, a marketing framework for HR meets that criterion.   I can illustrate that with my Corner Shop Exercise. (For American readers, the Neighbourhood Convenience Store Exercise).

Imagine you run a small neighbourhood general shop. Profit margins are tight, but you decide you really must hire some extra help for a few hours mid-week, whilst you go to the warehouse to buy stock, and then unload, and sort stock in your storeroom.  The employment product will therefore be “taking payment for goods, bagging the purchases, making sure the local kids don’t steal stuff”.  This job could be done late afternoon / early evening, a 3 hour shift on two mid-week days. Who is your target market? Most people I have tried this exercise on will at this stage be favouring senior school students as the target market; cheap, available, need the pocket money, but sensible enough to be left in charge of the shop. How and where will you advertise? Your target market will be very local – will it need any more than a home-made poster in your shop window?  And how much do you think you will pay?

On a small scale, you have just constructed a marketing mix; product, place, price and promotion to suit the segment of the labour market that you need for your business. Then you remember that you sell alcohol, and that licensing laws require that anyone selling alcohol should be over 18 years old. Perhaps you need to consider other segments of the (very) local labour market as the potential source of your assistant, such as stay-at-home mums, and people who have retired from full-time work. You will have to pay them more than a 16-year old.

Now we have demonstrated that a change in the employment product caused you to change your target market, and adjust your pricing to suit. The principles of marketing applied even to this scale of operation: branding did not.  

Update: On Tuesday I attended a presentation on employee engagement and retention. The speaker had lots of useful information on what employees' priorities are, how employers could retain staff, etc. The audience were mostly SME's from media and publishing sectors. When the speaker came to the topic of employer brand, she suggested that we should try to compete with Google, Apple and Virgin. If only it were that simple!

Was that HR ad sexist?

A long-running debate on the “CIPD member” Linked In form was prompted by a recruitment ad for  HR jobs that showed the above image of a man ripping his shirt open to reveal a super-hero costume underneath, with “HR” instead of a Superman logo. The text had jokey references to super- hero powers and wearing your underpants over your normal clothes.  (See the original advertisement at http://www.woodgroup-psn.com/careers/hr-hero.aspx. )

Overall opinion seemed to favour seeing the ad as an innocent use of humour, rather than intentionally sexist. The whole debate prompted another question to me; “Is targeting a sector of the labour market legitimate marketing, or indirect discrimination?”

In the UK, the law allows employers to advertise jobs in media that might be read by minority groups, if these are under-represented in your workforce. But with that limited exception, the law assumes that all other aspects of recruitment, and more importantly, employment will be on a non-discriminatory basis. Leading on from that, is there any scope for legitimate targeting of certain demographic groups that could not be viewed as discrimination?

If you have read any other of my blogs on employment marketing, you will know that the marketing of employment is a much wider topic that employer branding in recruitment.  We will use benefits policy as a starting point. Let’s assume I am in the lucky position of being able to improve the benefits package for the employees. I’ve considered the available budget, and have a choice of two initiatives to propose to senior management:-

a)      We offer free gym membership, and a “pick your own device” policy on business mobiles, allowing them to choose i-Phones, android phones, Blackberrys, etc.  OR

b)      We increase the employer contribution to the pension scheme by 1.5% of salary.

Whichever option we go for will be available to the whole workforce, but which demographic group is going to favour which? The first option is targeted to appeal to a younger age group, the pension improvement targets the older worker. If my company was operating a flexible benefits scheme there would be no problem, but assume we do not have that means of avoiding the problem.

It seems logical to choose the benefits to suit the workforce you have got. Look at the age profile, and if you have lots of young employees, go for the gym-and-phone package. If you have lots of middle-aged and older employees, the pension improvement would be welcomed. But does that approach then become a self-fulfilling prophecy? If you have a benefits policy geared to the needs of one age group, it becomes easier to recruit and retain that age group, and makes your employment product less appealing to the other.

There is probably a similar dichotomy on maternity and childcare provision between sectors that traditionally employ a high proportion of women, such as publishing and healthcare, and those that traditionally employ a low proportion of women, such as engineering. Organisations in the former sectors are likely to offer enhanced childcare and maternity benefits, whilst those in the latter are more likely to offer only the statutory minima.

Whilst most organisations will claim that they are keen to attract applicants from all sectors of the population, it will take a bigger commitment of resources to offer employment policies and benefits that would appeal to the groups that an organisation has not historically catered for. You might feel that the factors determining which demographic groups are attracted to you industry is beyond your control, and so just gear your policies to the existing workforce. ( “ Nursing will always appeal to women more than men” “Web design is a young person’s game”). It is possible to break out of the self-fulfilling prophecy, but you can’t tinker around at the edges. For example, Ford (UK) and Jaguar / Land Rover both offer a year on full pay to women taking maternity leave, a generous improvement on the UK’s statutory 6 weeks at 90% earnings, then 33 weeks on the statutory £135.45.    

Another example of targeting a sector of the workforce that has made recent news is the nationality of who serves your coffee. The Mayor of London, Boris Johnson recently complained that British workers were not getting jobs in coffee shops and those companies should do more to attract local workers ( http://www.telegraph.co.uk/news/politics/9249748/Why-do-foreigners-get-all-the-jobs-asks-Boris-Johnson.html ).

At about the same time, Pret a Manger, the coffee and sandwiches chain were publicising their recruitment and selection procedures. (http://www.peoplemanagement.co.uk/pm/articles/2002/05/6749.htm ) Most of these were sound robust and fair; competency-based interviews, and an on-the-job experience day, but the final selection process is a ballot by the existing team members. The branch manager cannot over-ride that decision. I think there might be a possibility that teams might be tempted to base “compatibility” on similarity of national or ethnic background.

I am not advocating that organisations should use targeting to exclude any particular demographic group, nor accusing any particular companies of doing so. Targeting your employment product to meet the needs of certain groups is essential to maximise your success in recruiting and retaining them. I think the principled way to use it is to define the target group initially and fundamentally by the skills that they have which your organisation needs.  If that group would prefer gym membership to a higher pension contribution from the company, then you need to respond to their priorities.  

What is the product behind the employer brand?

In marketing, you cannot have a brand in isolation from the products and services sold.  As employers, what exactly are we selling? Proponents of employer branding would say they are “selling” the organisation to potential recruits.  Are recruits only interested in “the organisation” but uninterested in the job they might actually do in the organisation? I have never met a recruit or a serving employee who does not care what they do, as long as they are part of a particular company.  

Employees are buying jobs and careers. In this transaction, they are paying with their time and effort, and are actually receiving money. This means our product is employment. That is the raw material that we shape into the employment experiences we are marketing.

 Imagine all the work to be done in your organisation; visualise it as one job description of enormous proportions. This job description includes everything from deciding the financial strategy to emptying the office bins in the evening. How would you divide that up into careers, jobs and teams? What rationale would you use to find the dividing lines? That is how we define the employment product.

At the most fundamental level we decide whether we offer employment as a long-term career in our organisation, or jobs that can form an episode in a person’s career as they move between companies. “Job” in the sense means something shorter in duration than a “career”, not lower in quality.  Larger organisations have more scope to offer intra-organisation careers than smaller ones, but organisations can choose where to position themselves on this factor.

To offer long duration careers involves trying to operate an internal labour market. Offering jobs that form steps in people’s careers involves frequent interaction with labour markets. This fundamental difference affects many other parameters of employment.  It determines whether the remuneration policy focuses on internal comparisons or market comparisons.  It determines the relative importance of succession planning and management development systems. It may influence the value placed on professional qualifications within the organisation.

Organisations may choose where to position themselves on this variable of career pattern offering.  Two stereotypes drawn from opposite ends of this spectrum will illustrate the consequent differences in personnel systems and priorities.

                                                                THE LADDER CORPORATION

The Ladder Corporation takes the majority of its recruits straight from full-time education, either at school-leaver or graduate level. The recruitment literature emphasises the variety of work that can be found within the organisation, and the wide range of careers it can therefore offer. Promotion from within is the norm, and so its HR function has sophisticated systems with which to track managerial talent and manage their careers, such as succession planning and elaborate appraisal systems. Senior managers are expected to come from the ranks of "generalists" who have been moved around various functions and departments of the Corporation. As knowledge of the Corporation's business and procedures is highly regarded, relatively little importance is attached to external training. Unless they are a legal requirement, professional qualifications are seen as unnecessary for promotion within the Corporation. Remuneration policy is geared to managing internal differentials by means of job evaluation and grading schemes. Comparability of salary levels to those of similar organisations is a consideration, but the Ladder Corporation loses few employees to competitors.

                                                                PERCH LIMITED                                      

Perch Limited recruits at all levels of the organisation. It may on occasions recruit school-leavers or graduates, but most vacancies are for those with some relevant vocational experience. The Company's managerial and professional staff see themselves as specialists in a particular function. Professional qualifications are seen as a useful indicator of some degree of competence. Experience of other organisations is valued as "breadth of commercial knowledge". Remuneration policy is geared towards maintaining market competitiveness. Perch Limited does promote from within, but often employees must compete with external candidates. Though many employees would welcome promotion within the company, few expect to stay there until retirement. They see their career development as their responsibility, not the Company's.

Organisations may choose where to position themselves on this variable of career pattern offering. The Civil Service, major clearing banks and blue-chip companies tend towards the Ladder end of the spectrum, whilst local authorities, hedge funds and small "hi-tech" companies tend towards the Perch end.  Over the last 20 years, big corporations have shifted towards the Perch way of operating, by no longer offering “a job for life”, and recruiting externally for senior jobs. Some small organisations try to become more Ladder-like by offering development schemes for graduates, to retain them.

The career patterns that organisations offer are mirrored by the career patterns that people choose. In their study of management job change, Nicholson and West described these patterns as “in-spirallers” and “out-spirallers”.  If you would describe yourself as an XYZ Corporation employee who just happens to be working in HR at the moment, you are an in-spiraller in a Ladder corporation. If you would describe yourself as an HR professional who just happens to be working at XYZ plc at the moment, you are an out-spiraller at one of several Perch companies that will form your career.

As the employment products offered by Perch and Ladder organisations vary significantly, their HR functions look very different, in terms of their priorities and activities. I will take reward as an example. In a Ladder Corporation, there is a big emphasis put on internal comparisons, and it is likely that HR will maintain a job evaluation system. Grading schemes and salary scales are well established, and only changed after much internal debate. Whilst the Ladder Corporation needs to ensure that its pay levels are comparable to competitors, it is not winning and losing people to its competitors at every level. In Perch plc, the emphasis is on maintaining market competiveness in various job disciplines. As Perch interacts with the market every time it recruits, competitiveness a real issue, sharper than a general notion of comparability. Concerns about pay will be focussed on market rates. Your sales people are concerned that they are being paid at the market rate for sales people in your sector. They are not interested in whether they are on the same grade as an accountant or an IT developer.    

When working in HR in an SME, which are invariably Perch Ltd’s, you soon realise that most so-called “best practice” is geared to the needs of Ladder Corporations. The HR academics and the CIPD want to study what’s happening in the big corporations, in the mistaken belief that this is the “leading edge” that the rest of the profession will aspire to. It is not the case that HR people working in SME’s are just slow to adopt new techniques. We are just unwilling to adopt techniques irrelevant to our needs.

Employer branding is a concept that appeals to the senior management of Ladder corporations because it matches the career pattern that many of them have followed – having several jobs within one organisation. The emphasis on the whole company, rather than specific jobs, seems the obvious way to go. For Perch corporations, a good public reputation is helpful but what you have to market is specific jobs to specialist labour markets.

Solving HR problems using Employment Marketing.

Applying a marketing approach to what HR does might seem rather academic, and removed from everyday HR operational problems. In this blog I give some examples of problems I have solved by defining them as marketing issues.

1.       “Working for you ruins careers”.

Organisations can have different reputations in different sectors. When I joined one company – the UK subsidiary of an Asian-based electronics company – I discovered how big the gap can be. One of the vacancies I inherited was for a sales person in a team selling IT products. I phoned a couple of IT recruitment agencies to give them the vacancy details. The first seemed a little guarded, saying it was quite a difficult market, and perhaps we need to increase the salary to get a good response. I was astounded when the second one refused to work on the vacancy. In fact, the recruiter said “Sorry, we will not send candidates’ details to your company; working for you ruins careers.”

I knew this sales division had a troubled past. The previous ex-pat Divisional Manager had a terrible reputation within the company. He had harassed staff to the point where several legal cases had been brought and settled out of court, the department suffered a high turnover of staff, and some of his business decisions had damaged relations with the distributors the company sold through.

This was not the kind of problem that could be solved through “employer branding”. We had to fix the product before we attempted to re advertise it. I am glad to say that the newly-seconded Divisional Manager was amiable, and keen to get the division working effectively. He was alarmed to discover what a bad reputation the division had inherited. In parallel to him establishing his relationship with the remaining staff, I started to cultivate some recruitment agencies. I worked with some that had also recruited for other divisions, as they knew that the company was a better employer in other divisions.  I frankly discussed the problem division, and its reputation in its specialist labour market. I reassured one or two that with me as a new Head of HR, and with a new Divisional Manager in place, there would be a radical improvement in the employment experience.  Gradually, we turned the situation round to a point where we could rebuild a full team.

2.       Bums on seats in the Training Room.

One of the companies I worked for was going through a period of sustained growth. We had recruited a lot of young ambitious staff who were keen to be developed, and they needed training as well as wanted training. The HR team had grown in parallel, and now included a full-time Training Officer. She had developed a number of short skills courses to be run in-house, and was getting sufficient nominations for places on the courses. Sufficient nominations, but not all there could be. We had many employees complaining that they were interested in the courses, but never got to hear about them in time. The Training Officer had been regularly sending managers the schedule of courses, so something was going adrift.

I had previously worked for a paper manufacturer, which is where I had heard of “Back-selling”. In the paper company’s range was a high quality brand of stationary (these were pre-email days). The paper company actually sold their products to paper merchants, in the strict transactional sense of that’s who they shipped the product to, and who they got their money from. The marketing strategy was to advertise the brand to senior business executives, getting across the message that their organisation’s image depended in part on the quality of paper they used for their correspondence. The senior executives would tell their PA’s to tell their Purchasing Managers to order “Conqueror” brand stationary from the paper merchants.

Applying this to marketing our training courses, I could see that we had to use back-selling. The problem was not the courses, nor lack of senior management support, nor convincing the ultimate consumers of the courses of their value. The middle managers were not passing on the information, but it was those managers who had the power to nominate staff to attend the courses. We needed to get the junior staff to pressurise their managers. We called this strategy “the push from below”.  The Training Officer started putting the training course schedule on the notice boards, and we included an item in the Induction Course on “Other Courses We Run”.  We included reports of training courses, particularly photogenic ones like training in the outdoors, in the staff newsletter.  When we had employees asking managers “why did we never get to hear about these course?” the level of nominations increased significantly.

3.       Who, what, where and how much?.

A marketing and sales division of a hi-tech company I worked for was situated in central London. It needed to set up a small R&D team of software specialists. The Divisional Director initially wanted to keep all his division together on the central London site. I advised him that the R&D specialists he sought were currently working out of town, mostly in the Thames Valley. He could probably attract them into London by offering them all very high salaries and fully-expensed company cars, but they would appear to be on an “over the top” package compared to any salary survey. Senior management would challenge the apparent extravagance of the package. We had to get a workable and economic balance of product (employment in software R&D), price and geographical place. It was finally agreed to set up a satellite office in Reading, Berkshire for the R&D team. This put us in the geographical place where people with the desired skills could be recruited at the prevailing market rate.

  

 All of these examples are applications of marketing concepts other than the overworked “brand”. They were all real HR problems. It is very unlikely that you will have these specific problems in your organisation at the moment, but I am sure that ones you have will be amenable to a marketing solution.   

What role does branding play in Employment Marketing?

My view of employer branding is that it is a limited realisation of what marketing principles could offer HR.  Its narrow focus on recruitment, and particularly recruitment advertising, reflects the interests of those involved in employer branding. Recruiters who think branding is all there is to marketing are in dialogue with advertising and recruitment agencies who think recruitment is all there is to HR.    

In order to understand the importance of brand in the marketing of employment, we first need to look at how people make purchasing decisions. For each of these purchasing behaviours, there is a seller’s marketing function looking at the transaction from the other end of the telescope. Their marketing strategy will cover developing the product, formulating the brand and advertising, choosing the appropriate routes to market, and setting a price that will appeal to the consumers they are targeted, and also meet the business plan.

f.m.c.g.	Semi-durables	Consumer Durables	Major purchases	Business purchases
Low cost                           >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>                      High cost
Simple pricing                  >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>              Complex pricing
Subconscious decision   >>>>>>   individual conscious decision >>>>>  Collective conscious decision

Fast-moving consumer goods. These are bought by habit. They are the kind of things you throw in the supermarket trolley with little conscious thought, such as breakfast cereals, canned drinks and toiletries. But the purchasing choice is not a random one; consumers are influenced by advertising and develop loyalty to their brand. The visual side of branding – product name, logos, package design – is essential to identify the product, and remind consumers of the advertising. When asked about their reasons for brand choice, consumers may find it hard to express; that’s why focus groups were invented. Items are low cost, and pricing is straight forward.

The visual identity of the brand, conveyed by the logo and the packaging, is the only means of communication with the consumer at the moment of purchase. Imagine if all soap powders were sold in unmarked plastic bags; how could you differentiate one brand from another?

Semi-durables. Fashion items are a good example. The brand is important, but consumers devote more conscious thought to the product choice e.g. does this suit me? The brand covers a wide range of products. Items are higher cost than f.m.c.g., but still one price for a simple transaction e.g. a £500 pair of shoes. 

Whilst the marketing function will want to develop a strong brand identity, the brand identity does not feature prominently on the product. The products selected must be consistent with the brand; the vendor cannot swap randomly from “bargain basement” to “high-priced luxury”.

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Consumer durables.  These are occasional purchases of expensive items. The purchaser is likely to put a lot of conscious thought into their choice. If buying a mobile phone or laptop, they are likely to read some special magazines, ask their friends what brand and model they have bought,perhaps have a list of questions to ask the shop assistant. The cost is high, and the pricing is often more complex than a spot price. Are there running costs or consumables costs to consider, and is it worth taking out the extended guarantee?

For the marketer, the marketing strategy will place great importance on product, as the features of the product are important to, and will be subject to prolonged assessment by, the consumer.  Product features will also be reviewed by consumer magazines and websites, and PR to professional reviewers is important. In distribution channels where sale staff might answer consumers’ questions, part of the marketing plan will be training those sales people to sell the product.

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Major purchases.  These are very expensive items that are bought rarely, such as a car or a house. The amount of conscious thought applied to the choice is usually in the realm of “agonising”. The consumer will be very specific about their needs, and put a lot of time into product selection. The pricing issues are complex. The consumer considers not just the initial price, but finance options, running costs and likely resale value. When buying a house, the purchaser will consider factors that they are not directly purchasing, such as what is the neighbourhood like, how good are the local schools? The decision will affect other purchasing decisions, such as commuting costs.

Brand, in the sense of logos and trademarks, are a minor part of the marketing plan. For example,  house builders will have a marketing strategy that will define the sector of the market they are targeting, the areas and locations, and the features of the houses will be geared to the lifestyles of the target groups. They will have a logo, but that is infinitely trivial when it comes to buying and selling houses.    

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Business purchases. When companies purchase things, the purchasing decision is very overt and rational, as it usually involves several people. Detailed reports are written, and alternative products are carefully evaluated. The cost is high, and the pricing complex.

The marketing plan from the manufacturer is likely to be very sales-led, and with great emphasis on the product.  An organisation is not going to buy capital equipment, or buy in a service that is critical to their business plan, on the basis of an eye-catching logo on a website or in a brochure.

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So what has this got to do with HR and employment? If someone is choosing a job, what kind of purchasing decision are they making? Admittedly they are “purchasing” with their time and effort rather than their money, but they are nevertheless choosing between employment products. I don’t think it’s a fmcg kind of decision – they don’t just recognise your logo on an advert and say “Yes – that’s the one for me!  I think for most people it is somewhere on the scale between consumer durable and major purchase. Before committing to a decision they will want to know what the features of the job are – what will they have to do? They will be thinking long-term as to whether this job fits into their life plan, and will it enhance their own “resale value” to future employers.  They will be making a thorough assessment of the pricing structure of the employment product. The starting salary is only part of the picture; what about the future earnings prospects, the benefits, the non-financial features such as terms and conditions.

With any purchasing decision, one consideration for the consumer is what kind of people also buy the product. With the employment product, you are going to be spending most of your week with people who made the same purchasing decision. That is a more significant relationship than with the neighbours you will gain when buying a house.    

As with consumer durable purchases, the consumer of the employment frequently re-evaluates the purchase. With a car, you will re-evaluate your choice when you buy fuel (should I buy a hybrid engine model next time?), when the servicing bill is presented, when the holiday luggage won’t fit in it, when you need more or fewer seats as family needs change, when friends and colleagues buy a new car, when you see new models advertised. If you really made the right choice for you, the questions might be infrequent, and always answered positively. How often do you re-evaluate your job?  If you feel it is just the right job for you, the questions might be infrequent, and always answered positively.  But the range of issues, the degree of emotional commitment to the job and the duration of the working relationship mean that you will re-evaluate your job choice with more deliberation than when choosing a box of breakfast cereals or a pair of shoes. Every appraisal, every pay review, every particularly good or bad week at work, and comparisons to how friends and relatives are faring in their careers are all opportunities to decide whether to stay or change jobs.

HR is concerned with marketing employment as a continuing relationship with employment consumers. Recruitment is a part of that, and brand (in the sense of image portrayed in recruitment advertising) is a small component of that part.   

We have already got Employer Branding – isn’t that enough?

I did get the concept of employment marketing into print before employer branding came along, though only in letters to professional journals. It was not until 1996 that I had full articles on employment marketing published, and by then employer branding was catching on.(These articles are reproduced below, see blog for 3 January and 26 December.)  So I view the rise in popularity of employer branding with mixed feelings. It is applying a marketing technique to some of what HR does, which makes it an ally. My antagonism to employer branding is that by applying some of marketing to some of HR, it blinds HR people from seeing the possibilities of using all of marketing across everything that HR does.

One obstacle that both approaches share is the general ignorance of marketing amongst HR practitioners (at least in the UK). Most see the terms “marketing” and “branding” as synonyms for each other, and both meaning “advertising and promoting.”  I am not going to attempt authoritative, detailed definitions here – if you are an HR person who has never read a marketing textbook, go and read one right now.  

The current Wikipedia definition of employer branding is good enough. “Employer branding has been defined as the sum of a company’s efforts to communicate to existing and prospective staff what makes it a desirable place to work, and the active management of a company’s image as seen through the eyes of its associates and potential hires. “

There’s nothing wrong in that. It’s a good idea to have a positive brand image rather than a bad one. We would all like to be perceived as good places to work. It then gets seen as the concern primarily of the recruitment function and, for big organisations, also the concern of corporate affairs. For many HR practitioners, the mechanisms by which you manage employer branding are the recruitment channels you use, the look and feel of the recruitment website, the organisation’s mission statement and code of company values, and the PR efforts of the organisation. Some HR people put too much emphasis on the visual aspects of company logos, advert layout, etc. – reflecting the kind of branding relevant to fast-moving consumer goods. ( In a later blog, I’ll discuss the relative contribution of the visuals; branding in the sense of trade marks, logos and packaging, to employment.)  

So what does employer branding not pick out of the marketing toolkit? Quite a lot, I think.

In many cases, HR practitioners do not have a target section of the labour market in mind – “we want the brand to appeal to people”. Great – you’ve narrowed it down to a species.  Just applicants from homo sapiens need apply!  For companies like national supermarket chains, they might justify appealing to “the general public” as their product brand does, and their recruits come from a very broad range of the labour market. For many organisations, there are particular groups that you want to attract because they are key to your business.

Once you have identified those sectors of the labour market, you can do some competitor analysis, and research how your product offering (all aspects of the careers and jobs you offer) are perceived by the relevant employment consumers. This can bring in the marketing approach to pricing to ensure that your remuneration is competitive for the employment consumers you need to attract and retain. The marketing discipline of product development can identify if certain aspects of the work you offer appeals or discourages the employment consumers you need to attract. For example, does it involve using leading-edge technology that will have an additional appeal? Perhaps the work you have to offer involves using legacy technology that is a negative factor that you will have to compensate for in offer aspects of your offering. 

The brand reality exists in the minds of potential and current consumers. Their perception can be influenced by things you do to the product, its pricing or promotion. The brand is not something unilaterally decided by the organisation and then transmitted one-way to the consumer.

It seems for most HR people who want to do employer branding, the idea of a never-ending interaction between employment product offering and consumers’ expectations is a bit too complicated. Let’s just start the process in the middle and invent a brand.  For example, here is a quote from a 2007 CIPD paper on employer branding:-

“Employer branding begins with the creation of an employer brand image, what an organisation’s senior managers want to communicate about its package of functional, economic and psychological benefits..”  

 The CIPD’s other employer branding publication in 2007 “Employer Branding: A no-nonsense approach” saw developing your employer brand as basically a project. Get buy-in for the project, get a budget for research, choose an agency to help you, within a few weeks you will have a new web site and a smart logo, and that’s employer branding done – simples!

A further limitation of the employer branding approach is that even when done very thoroughly, it assumes there is only one branding strategy within marketing. The assumption is that employer brand must be an example of multi-product branding. This is where all products of a company sit within one brand; BMW cars is a good example. Other companies go for the approach of multi-brand products, where individual products have their particular brand. The diverse products of Procter and Gamble epitomise this approach. Could there be circumstances where an employer should opt for a  multi-brand strategy?  If an organisation has acquired a subsidiary with a very different ethos and profile of workforce, keeping separate identities might be the best option.  To offer an example from personal experience, I worked for the UK subsidiary of a Far East corporate. In its home country, the corporation was a household name, a major employer able to offer long-term careers, and was strong on in-house training. Within the UK market, our subsidiary was small, unknown and rapidly growing. In the UK we attracted people who saw their career as something they managed by moving through different companies.  Trying to impose the parent company’s brand and employment products would not only be inappropriate, it would actually deter the kind of people we needed – entrepreneurial and comfortable with risk. The parent company brand might appeal to those who wanted a risk-averse corporate career, but we could not deliver that in the UK subsidiary. Different employment products pitched to different target market segments cannot be the same brand.  

The role of the marketing function is not to manage the brand. Their role is to get people to buy the product. Brand is only an intermediate step in the process. Applying marketing to employment means every change HR makes is making a marketing decision.