There are no two ways about it – the labor market is competitive. Attracting and retaining top talent is often a central challenge for businesses. To combat this predicament, organizations have increasingly focused on cultivating a strong employee value proposition (EVP) to attract potential employees. But in the post-pandemic world, what makes for a compelling EVP?

In this blog post, we will delve into the meaning of EVP, explore its evolution and discuss how you can assess the effectiveness of your own EVP.

Employee Value Proposition refers to the unique benefits, rewards and opportunities an organization offers its employees in exchange for their skills, knowledge and dedication. It encompasses the overall value employees receive from their work experience, including compensation, benefits, career growth, work-life balance, company culture and more.¹

An effective EVP is pivotal in attracting top talent, fostering employee engagement and enhancing retention rates. When done well, it communicates the distinct advantages of working for a particular organization and sets businesses apart in the talent market.

EVPs and total reward strategies are rooted in the psychological contract that defines the employee/employer relationship. Previously, the loyalty contract was the premier arrangement. Organizations encouraged employees with financial incentives, job security, and benefits. In return, employees brought skills, capabilities, experience and a long-term commitment.

Yet, at the dawn of the 21st century, it became evident that this approach had limitations. Extensive research reveals that employees desire more than extrinsic motivators like pay and benefits. They seek intrinsic motivation, meaning and purpose in their work, a sense of community, camaraderie and opportunities for personal growth and development. This shift in understanding led to the emergence of the engagement contract, where organizations focused on meeting employees’ psychological needs through compelling job experiences and meaningful work.

While engagement remains crucial, more is needed in our post-pandemic world. The pandemic has reshaped employee values, altering the importance of work. Previously, work centrality was high. Stability, good bosses and promising career development were highly sought-after indicators of success. However, research shows that team members now prioritize different aspects of their lives after experiencing lockdowns, layoffs, remote work, virtual meetings and widespread uncertainty.

Recent studies reveal that employees are more concerned about their physical health, work-life balance and emotional welfare. This trend is evident across organizations, as employees seek a new contract that prioritizes their overall well-being, supports their preferred lifestyle and promotes sustainable performance. This also represents a shift towards a lifestyle contract, where healthy experiences and sustainable performance take precedence.²

From a talent management perspective, it is crucial to assess the relevance of your EVP considering changing work dynamics, shifting core values and the emergence of a new employee contract. Organizations must evaluate whether their EVPs, rewards strategies and benefits packages are still effective in a post-pandemic world. When it comes to assessing the current appeal of your EVP and understanding the future needs of your workforce, steps that can help you discern efficacy include:

Assessing Employee Experience: During disruptive times (we’re looking at you, COVID-19), understanding your employee’s personal experiences is vital. Conducting online focus groups, particularly with employees that work from home, can be an effective way to gather insights. Open-ended questions and advanced qualitative methods like natural language processing can help capture employees’ thoughts and experiences, providing a rich understanding of their perspective.

Pinpoint Core Needs: An effective EVP must address the core needs of your workforce. Neglecting these needs can lead to employee distraction, distress and attrition. Taking a holistic approach, consider employees’ work life, personal life, financial concerns, health and well-being. Conduct a comprehensive needs assessment to identify employees’ most pressing problems and develop evidence-based insights into their current and future needs.

Evaluate Cost-Effective Rewards: While meeting every employee’s needs would be ideal, organizations must make practical trade-offs and design realistic and cost-effective rewards packages. Conjoined research is an effective method to identify these trade-offs. By arranging specific EVP elements in balanced design comparison sets, employees can indicate their preferences and prioritize what they value most and least.

Identify Preference Trends – The era of standardized employment contracts is rapidly becoming outdated as more individuals seek to customize their work experiences and establish unique employment arrangements with their employers. The pandemic accelerated this growing trend towards personalized deals, presenting various challenges that differ depending on employees’ career stage, personal lives and future aspirations. As you revamp your EVP, assessing the extent to which employee preferences vary across different employee populations is crucial.

We suggest employing research techniques such as cluster analysis, profile analysis, and personas to identify preference patterns and understand the need for flexibility in EVP offerings. APERTURE, MJ’s proprietary analytics tool provides an interactive, clear picture of your real time data. Allowing you to dive into the impact your past and present strategies will have on your future. Using these methods, you can characterize distinct workforce segments and tailor EVP strategies accordingly. As research suggests, work-related needs and desires vary based on gender, generation, job level and caregiving status.³

A compelling Employee Value Proposition is vital for attracting and retaining top talent in today’s competitive landscape. A powerful EVP that reflects your company’s unique culture, values and opportunities can become a magnet for exceptional talent and work to drive your business.

By going through these steps, your organization can gain valuable insights into EVP effectiveness and make informed decisions about adapting it to support the evolving shape of work. This proactive approach ensures that your EVP remains future-proof and aligned with the expectations of your employees.

To learn more about how MJ can leverage real-time data-driven insights to help you build meaningful total rewards strategies, contact us today!