Managing the internal employer brand - why bother?

Proponents of employer branding often suggest that organisations should manage the brand within the organisation, as a means of getting feedback from employees on their view of the employment experience. Some will go as far to suggest that by managing the internal employer brand, it is possible to change the company culture.  ( For example See Brett Minchington’s article http://www.brettminchington.com/free-resources/strategy/135-transforming-culture-with-employer-branding.html  ) So I am going to be a little heretical; brand management of the internal employer brand is a distraction from what HR should be doing.

A brand can be an identification or a mark that differentiates one business from another (through a name or a logo, for example).  The brand also symbolises how people think about your product. The concept of branding was developed initially in the sale of fast-moving consumer goods. Your brand identified your soap powder from all the others on the shelf, and reminded consumers of the associated advertising. The advertising had conveyed overt messages and subconscious associations. The brand was a communication from the producer to nameless millions of potential consumers stood in front of the supermarket shelf.  

Communication from those consumers back to the producer is limited. Sales figures provide the most direct feedback, but trying to obtain any other information is difficult. The producer needs to commission market research to obtain qualitative feedback from samples of consumers.

Outside the world of f.m.c.g. , other kinds of customer relationships exist, which are shaped by the complexity of the purchasing decision. These are described in my blog from January 2012 “What role does branding play in Employment Marketing?”  For example, consider a business-to-business transaction like the sale of an IT system. The seller will be dealing with the customer at length in many meetings. The purchaser will not be making an impulsive decision, but will follow a detailed purchasing procedure of RTT’s, short-listing and product evaluation.  The seller will have a brand, but the contribution of the brand to the purchasing decision is minor, compared to the detailed evaluation of the product.

Which purchasing scenario is the best analogy for an employee ( a consumer of employment) evaluating their current employment experience? Are they individuals unknown to us, unconsciously selecting an employment experience off the shelf? Or are they individuals we can talk to at length about their particular employment experience, and how they feel about it?

For most organisations, we surely have a close, direct relationship with the people who have currently chosen our employment product. Compared to the distant consumers of f.m.c.g. products, we know a lot about our employees; their profession, qualifications, family circumstances, how much they earn. A product manager of a shampoo or drinks brand would kill for that quantity and quality of information about his or her consumers.  And our consumers are easy to find – they are on the premises five days a week – just go out of the HR office and there they are!

 You can get direct feedback on how they feel about the employment experience. Here is a real example. A couple of months ago, my company moved offices. We moved from a tatty, poorly decorated building where the employees were spread over six small floors to a new, bright open plan office with the whole workforce on one floor. The new office is kitted out with new furniture and improved IT, and looks “seriously funky”.

Which would be the best question to ask my colleagues?   “What do you think of the new office?” or “Has the new office enhanced or diminished your perception of the employer brand?” 

We intended the new office to improve communication, and present a better image to clients. Shall I ask my colleagues “How has the office changed the company culture?” or shall I commission a survey to ask them “Has the change of office shifted your perception of the employer brand in respect of communication and general brand image?”

There may be situations in which direct conversation is not the best option. Employee surveys in which responses are anonymous can reveal insights that would not emerge otherwise. In general, direct communication with employees is preferred. I might incorporate our new building into our employer brand, by replacing the careers page catalogue photo of some posed models in an unknown office with a shot of some of our employees in our office. That will communicate something about our company to prospective candidates who I have no direct communication line with.  That is where the employer brand is useful.

I suppose some organisations are so big that the distance between the corporate HR function and the front-line staff is so great that an internal brand is necessary. The majority of the working population are employed in organisations of less than 500 people however, so direct communication should not be a problem.

If an HR function is considering trying to change the corporate culture by changing the internal employer brand, they must be devoid of ideas. It is basically trying to improve the product by changing the wrapping. There must surely be scope to change the culture by changing the employment product; organisational development, job re-design, changing the way managers manage, changing performance management systems, reviewing communications channels?  Or perhaps the pursuit of “best practice” has made the jobs in your company indistinguishable from jobs in your competitors. If you have a “me too” employment product, perhaps changing the wrapping is all you can do.  

 I am not saying “abandon the application of marketing to HR”.  I have long advocated using marketing as a model for HR. I am saying “apply all of marketing to HR, and you will find that branding is a small part of it.”   

The Eternal Internship and Youth Unemployment

Recently a colleague and I were talking to a postgraduate student at a university careers event, and the topic of internships arose. I mentioned that I had met a graduate in fashion design who wanted to get into fashion journalism. She had already done an unpaid internship with a publisher, and had recently been turned down for another internship with different publisher. She had been given the reason that the unpaid internship had been given to someone with greater experience.

My colleague then quoted the experience of an Italian friend who had been in London getting work experience in a travel agency. Her friend was on a paid scheme funded by the Italian government, but was surprised to find that she was working alongside four British employees who were on unpaid internships. The Italian graduate and the manager were the only team members being paid anything.

The postgraduate student then topped that story with the experience of a friend of his younger sister. This music technology graduate had secured an unpaid placement with a computer games company, in their music and sound effects department. The department of 20 consisted of a paid manager and 19 unpaid interns.

These anecdotes illustrate how inadequate is the UK government’s response to record levels of youth unemployment. Training in job search skills and unpaid work experience do help individuals become more employable; in effect they help the individual move closer to the front of the unemployment queue. But what use is that if the front of the queue is not moving into paid employment?  The graduates mentioned in the situations above had succeeded in the recruitment process to get a placement, against completion from many others. They had gained real work experience in the career of their choice. Some of these unpaid work placements could go on for months, but there is no paid job to go to.

From an individual’s point of view, it is advisable to get work experience to improve your employability. My son is an unemployed school-leaver and my daughter is soon to graduate in an arts subject. I will be encouraging both to find internships, unpaid if necessary, to be better placed in the one- million-long queue of unemployed 18-24 year olds. We are aware that the youth unemployment line is not moving forward fast enough, and there will be another year of school leavers and graduates joining it in the summer.

We need to identify the jobs where there are real skill shortages and provide training courses for those trades and professions. The costs per head will be more than the Government’s current cheap but ineffective programmes, but will result in people taking up paid positions which will actually reduce unemployment. Many of the shortage disciplines are various kinds of engineering, because the UK has failed to produce enough of its own.  

A more fundamental change to our education system is also required. The British education system needs to develop high quality vocational courses, as the German system has provided for decades. And -  this is the step that most British educationalists and teachers will struggle to comprehend – encourage bright pupils to take vocational courses. For most British teachers that sentence will be an oxymoron. In their minds, bright pupils do academic subjects, pupils who are no good at exams do vocational subjects.   I think the suggestion is too radical to explain – it just needs to be said at this stage, in the hope that it might sow a seed.

Easy Ways to Make HR Strategic

A long-running debate within Human Resources has been “how can we make HR strategic?”. Often this is linked with another navel-gazing debate within the function, “how can HR get represented at Board level?”.

Many HR practitioners claim they have succeeded on the strategy issue. They claim they have an HR strategy, and it has been approved by the Board, so they are now “strategic HR”.  Casting my jaded cynical eye of some of the approaches used, it seems there are several easy ways to get strategic.

Motherhood and Apple Pie.

Undoubtedly the most popular approach is to put out a document describing your HR philosophy and policies, and call it your People Strategy or Human Resource Strategy. A quick internet search will give you examples; universities seem particularly keen on this approach. This is a good way to reassure current and potential employees that you are nice guys, recruiting the best people for your organisation, allowing them to achieve their potential by providing career development and training, promoting equality and fairness.  

This approach does no harm, and is very useful promotion for the work of the HR Department. Unfortunately, even if it has been approved at Board level and has a nice introduction from the CEO, it isn’t strategic.

Provide enablers.

 At one level, this route to strategic HR status does appear to link HR initiatives to the business strategy. You get senior management to agree that they can’t achieve their business strategy without this vital latest thing from HR. For example, they cannot achieve their business strategy if employees are not performing, so our new performance management system must be strategic. After all, it’s now Part Of The Strategy.

You might be satisfied with that, but I am not. The enabler you have provided is a bolt-on extra to any business strategy of any organisation. It is as useful as your Facilities Department’s contribution to the IT strategy; computers need electricity, so we will ensure the supply of electricity. The IT strategy would be rendered useless without electricity, but consider an IT Director wrestling with the intellectual challenge of what systems to choose to support the business plan. He or she is not greatly helped by hearing that the electricity bill is paid, and there’s a back-up generator in the car park.   

Everything is strategic now. 

Particularly if you have a motherhood- and- apple- pie HR strategy and you have attached it to whatever business strategy they have gone with, there’s still one more easy thing to do; call everything strategic. Label things strategic and people will be impressed, just like in the Marks and Spencer adverts.  “This isn’t just a Management Development Course; it’s a Strategic Management Development Course.” ( for non-UK readers who haven’t seen these adverts http://www.tellyads.com/show_movie.php?filename=TA3444 )

Most strategies can be summarised in a few points. Some can even be summed up in a phrase, such as “pile them high and sell them cheap”, “shoot and scoot”, etc. A mass of HR people referring to their 110-point, 27-page strategy document is not strategic: it is an exercise in mis-naming the tactical, operational and possibly trivial. 

So, what is Strategic HR?

The only real HR strategy is the plan to manage the employment aspects of the business strategy, and some of those are not for public, or wide internal, consumption.  What changes to the workforce are integral to this organisation’s specific business strategy? For example, if the business is going to change its core technology, will it be better to retrain the existing workforce, or replace them with recruits who already have the new skills?   Or perhaps the business strategy calls for significant cost reductions, and one of the “people” options is significant off-shoring to cheaper labour markets.   

Many HR leaders would shy away from options that will be seen as a threat to the current workforce. HR people try to position themselves as the moderates who soften the blow, by providing retraining, or a caring redundancy / re-employment / outplacement service. The negative impact on the current workforce was caused by the decision made by “the Board” or “Senior management” or “line management” – but not us.

For HR to be strategic, (and to get a seat on the Board, if that’s important to you) HR people have to join in with the rough stuff, if necessary. That does not mean just understanding other business functions such as finance and marketing. Senior management don’t want you to be an amateur accountant or marketer, they need you to generate the options on the people side of the business. The effective options might include the tough ones.  Do most HR practitioners really want to play with the big boys?   

(If your sensibilities can cope with more of this stuff, read the companion article "Another way to make Human Resources strategic".) 

Employment marketing in the recession

It is over four years since the Lehman Brother’s collapse kicked off the global financial crisis, with its variants including credit crunch, double-dip recession, fiscal cliff and Eurozone crisis.   HR’s strategic response to the changed labour market has parallels to how a marketing director might react to a slump in the market for the company’s products.

Faced with declining consumer spend,  a major marketing decision is whether to keep the selling price high, and accept a lower volume of sales, or to reduce the price to defend volume of sales and market share. The most urgent task at the beginning of the recession was to reduce costs, including labour costs. Some organisations took the option chosen in previous recessions of making some employees redundant. That is the equivalent of the “defend the margin, but lose market share” option.  A distinct trend in this recession is that many companies have opted for spreading the agony wide and thin, and tried to find ways of retaining skills. That might have been by requiring full-time staff to accept part-time contracts to avoid redundancy and freezing the pay of all staff.

Bearing in mind how the power in the recruitment market has swung from jobseekers to employers in this recession, many organisations are finding ways of hiring lower cost labour. The growth of internships, either low-paid or unpaid, is an effect of the continuing recession. “Modern apprenticeships” offer 18 year old entrants an hourly rate that is half of the National Minimum Wage. A distinct “prospects cliff” has emerged between those who entered the labour market before September 2008 and their younger brothers and sisters. With almost a million 16-24 year olds unemployed in the UK, advertising an unpaid internship attracts a big response of over-qualified candidates desperate for work experience.

It is not a straightforward choice to exploit market conditions to obtain cheaper labour. As with a marketing director being mindful of the company’s reputation in the long term, the HR director needs to consider the impact on other stakeholders.  The introduction of internships and apprenticeships into a workforce might be seen as a positive contribution in tackling youth unemployment or as exploitation of the young as cheap labour. What decides the issue is how the permanent workforce is being treated. If they feel relatively secure, they are more likely to see it as a positive move. If they are not secure, they will see it as a threat of being replaced by someone cheaper.  There are limits to what internal PR can achieve here – you employ intelligent people, and they know when they are being shafted.

In the UK, whilst recorded unemployment is high employment numbers are also high. The headline figure showing high employment levels hide a large element of underemployment. Individuals are employed, but often working fewer hours than they would like to.

John Philpott, director of thejobseconomist consultancy and an expert on unemployment, said that of the 212,000 jobs created in the latest quarter, one in three were mini-jobs of fewer than 15 hours work a week and more than half (54%) provided fewer than 30 hours (The Guardian, 18/10/2012)

In a similar vein, let me give you some good news, and some bad news.

“Britain is heading for a fifth year of falling living standards, with official figures showing a decline in average earnings growth last year from 1.7% to 1.4%.

Unemployment fell and the number of people in work reached a record level in the three months to last November, but employers kept a lid on pay rises.”

They were adjacent paragraphs in the same article -  www.guardian.co.uk/business/2013/jan/23/unemployment-rate-fell

This phenomenon is a combination of organisations opting to spread the agony wide and thin, and individuals desperately trying to keep employed, even if underemployed.  Ironically, the villain of the story, the finance sector, is taking the other approach – dump some, but still pay big money to the survivors! 

Inevitably, coping with the continuing recession has forced many employers to take tough decisions with painful consequences.  Using marketing as a model for HR can generate strategies for changing the workforce to meet new and difficult market circumstances. For many HR practitioners, they do not want to initiate changes that might adversely affect the current workforce. It is easier to say that the bad news was caused by “a line management decision” or “a senior management decision” rather than an idea generated in HR. Despite all the talk of HR being strategic and deserving a seat on the Board, that cannot be achieved by shrinking away from the business decision. If you want to be strategic, take the lead in the hard stuff, not just the easy stuff.

    

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