Understanding employee value proposition (EVP)

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What is an employee value proposition (EVP)?

An employee value proposition – or EVP for short – is a statement geared toward prospective (and current) talent, creating a clear vision of why they would want to work at your company.

Having a well thought out and clearly articulated EVP can help you to both attract and retain talent. When candidates and employees know exactly what your company stands for and how they will contribute to your broader mission and vision, it’s much easier to differentiate yourself from competitors. Research from Achievers shows that the culture and values of an organization are the top factors of employee satisfaction, and over 75% of employees consider it “very important” to work for a company with defined core values.

What exactly should your EVP include? One definition, published in Harvard Business Review from INSEAD professor Mark Mortensen and Harvard professor Amy Edmondson outlines four main components: 

• Material offerings – includes compensation, physical office space, equipment and perks
• Opportunities to develop and grow – all the ways an organization helps employees acquire new skills and become more valuable in the labor market
• Connection and community – the benefits of being part of a larger group, including mutual accountability and social relationships
• Meaning and purpose – the organization’s aspirational reasons for existing

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Gartner, on the other hand, includes several potential components of an EVP in their definition: 

• Competitive compensation
• Comprehensive benefits
• Growth opportunities
• A positive work culture 
• Work-life balance
• Alignment with company values
• A clear career path

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One thing you might notice is that while these definitions vary slightly, they both address both physical or material needs (like compensation and workspace), as well as more emotional or motivational needs (like purpose, growth and alignment with company values).

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Developing and improving your employee value proposition

If you don’t already have an employee value proposition or you’re concerned that it might be outdated, here are some steps you can take to develop and improve your EVP.

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Step 1: Gather input from throughout your company

Former VP of People at Greenhouse Cheryl Roubian recommended starting by talking to as many employees as you can. Try to get a good cross-section of levels and departments so you get both the big-picture view and the day-to-day experience. Looker’s former Chief People Officer Kelli Dragovich also recommended tapping into your alumni community – asking them about their experiences and perceptions can help you measure the continued impact of your company values and brand. 

Not sure what to ask during these conversations? HubSpot’s former Employer Brand Manager Hannah Fleishman recommended using the prompt: “People love to work at ABC COMPANY because XYZ AWESOME/UNIQUE ATTRIBUTE.”

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Step 2: Identify your differentiators

With all the input you’ve gathered, you can start to find the common threads that draw people to your company and keep them there. Based on this information, you can come up with a shortlist or draft version of your employee value proposition. 

But don’t stop there – you’ll want to get feedback from others to ensure you’ve captured your company accurately. Make sure to get input from your marketing and recruiting teams since they can help you refine your messaging and ensure it resonates.

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Step 3: Communicate it widely

Once you have a version of your EVP you’re happy with, make sure you share it broadly, both within your company and with prospective candidates. Within your company, this might include sharing it at an all-hands meeting or through other internal communication channels. To share it with candidates, you might publish your EVP on your careers page and encourage recruiters and interviewers to reference it during the hiring process.

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Step 4: Update it as necessary

As time passes and your company evolves, your employee value proposition may start to feel like it’s no longer as accurate as it once was. That’s why it’s a good idea to periodically review your EVP and update it as necessary. Make an effort to do this when you reach particular milestones like your five-year anniversary, go through a period of hypergrowth or experience any other major shift.

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Measuring and evaluating the impact of your EVP

While there’s not necessarily a single “EVP” metric, there are several metrics that will help you measure and evaluate the impact of your EVP. Gartner recommends measuring: 

Quantitative metrics like:

• Retention rates
• Engagement 
• Productivity 

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Qualitative measures like:  

• Employee feedback
• Employer brand perception
• Recruitment metrics (such as qualified applicants and time-to-fill)  

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Benefits of a strong employee value proposition

Why take the time and effort to invest in building an employee value proposition? Here are a few of the ways having a strong EVP can benefit your company.

A well-defined EVP can increase employee engagement and satisfaction. Gartner finds that effectively delivering on your business’s EVP can decrease annual turnover by 69% and increase new-hire commitment by 30%.

Your EVP can be a powerful recruitment tool, making it easier to attract and hire qualified candidates. According to LinkedIn research, companies with a strong employer brand:

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• Attract 50% more qualified applicants 
• Hire 1–2x faster 
• Experience a 28% reduction in turnover

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Your EVP can also have a positive impact on your employer brand and reputation. Greenhouse found that nine in every ten candidates expect the hiring process to reflect a company’s culture and values. But be aware that they won’t just rely on recruiters to form their opinion – they’ll also consider sources like Glassdoor, word of mouth and direct contact with current and former employees to evaluate a company’s employer brand.

The opposite is also true – when candidates feel you’ve misrepresented your EVP or employer brand during the hiring process, this can have a negative impact. Greenhouse found that 45% of candidates had rejected a position after they determined they were being catfished by an employer.

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Key components of an employee value proposition

As you begin to define or refine your own employee value proposition, here are some of the key components to consider. 

• Competitive compensation and benefits

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Candidates consider a number of factors when evaluating job offers, but pay is the top motivator when accepting a new job. According to a study by Aerotek, 40.6% of respondents said salary matters more to them than any other factor. But take note: The Greenhouse Candidate Experience Report found that 53% of job seekers received excessive praise and flattery during the hiring process only to be disappointed by inadequate salary and title offers that didn’t match their qualifications, skills and experience.

To avoid disappointing candidates and losing your existing talent, you’ll need to ensure you’re offering competitive compensation and benefits. Learn more about creating a competitive compensation package for your candidates and employees here.

• Career development and growth opportunities

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Offering career development and growth opportunities to your existing employees – often referred to as “internal mobility” – brings a range of benefits. According to LinkedIn, companies that invest in internal mobility enjoy 53% longer employee tenures and 79% more leadership promotions. Not to mention the fact that you can help your company adapt to future needs and challenges with a much shorter time-to-hire and ramp-up time. 

Maria Culbertson, Senior Manager of Internal & Executive Communications at Greenhouse, put it this way: “As companies continue to scale, the likelihood of finding talent within the walls of your own organization grows significantly. You have entire talent pools of candidates on hand, fully bought into your mission and ramped on your company. So why not go there first?”

• Work-life balance and employee well-being

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Remember the “value” part of the employee value proposition? It’s important to consider the ways you can offer value that supports your employees’ emotional and psychological needs. One way of doing this is to help your employees avoid burnout by maintaining a good work-life balance. You can do this on a company-wide level by offering flexible work arrangements, the ability to work from home and programs that encourage employees to take time off to recharge.

It’s becoming increasingly common for companies to offer sabbaticals – generally an extended period of paid leave available for all employees who have achieved a certain tenure. Ariana Moon, VP of Talent Planning & Acquisition at Greenhouse, wrote: “With the right kind of preparation and intention, sabbaticals enhance the well-being of the person going out of office and provide an incredible opportunity for accelerated growth and business exposure for the coworkers stepping in and up to support them.”

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Examples of effective employee value propositions

Customer relationship management platform HubSpot offers a master class in communicating your employee value proposition to candidates. HubSpot’s careers page showcases their EVP with a brief introduction to the business: “HubSpot is a leading customer relationship management (CRM) platform for scaling companies. Tens of thousands of customers all over the world use our marketing, sales and customer success software to grow their businesses. It's our mission to not just help them grow, but to help them grow better. That's how we'll build a company future generations will be proud of.” 

They also offer a rundown of the company’s core values, including “Everyone’s empowered to work autonomously” and “Employees are treated like people, not line items.” And for anyone who really wants to dig into HubSpot’s company culture, there’s a 128-page HubSpot Culture Code slide deck!

HiveWatch is an LA-based startup that was built on the idea that physical security needed an overhaul. The company doesn’t accept “the way it’s always been done” when it comes to their industry – and they make this very clear to candidates on their careers page. This statement encapsulates their EVP, making it clear both what the company does and the qualities their ideal candidates have: “HiveWatch is a tech-forward, inclusive organization leading the evolution of the physical security industry with innovation and collaborative problem solving. We are passionate about the problems we’re addressing for our customers and equally passionate about the company we’re building. We’re looking for diverse perspectives to come to the table and help define what ‘keeping people safe’ really is.”

Of course, we may be a little biased, but we happen to think the Greenhouse careers page is another example of an effective EVP. We start with a simple statement: “Doing amazing work has everything to do with being in the right role, on the right team, at the right time. That’s why our mission is to make every company great at hiring. Because when a company gets hiring right, people can do the best work of their careers.” There’s a short video featuring Greenhouse employees sharing why they work here, an introduction to our values like “We embrace our differences” and “We solve important problems” and additional quotes from employees, plus a list of industry recognition and awards. 

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Evolving your employee value proposition

Change is constant in today’s working world, whether it’s in terms of your employee headcount, makeup and office locations, or even the types of problems you’re solving or customers you’re working with. This is why it’s so important to periodically reevaluate your EVP and adapt it to changing workforce and market trends. 

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One area that’s worth investigating further is how you’re incorporating diversity, equity and inclusion (DE&I) into your EVP. You may want to share how your company welcomes candidates from different backgrounds as well as any resources you offer to encourage candidates to bring their whole selves to work, such as employee resource groups.

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The good news is, if you’ve already invested in creating a people-first culture, you know that all your people practices – especially hiring – are strategic rather than administrative functions, and you’re taking steps to put people first in all your decision-making. And if you’re not quite there yet, consider this a not-so-gentle nudge to start by defining your EVP and continuing to evolve it along with your company. 

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Find more featured resources here: 

• How to effectively assess talent with a strong interview structure
• Hiring manager’s guide to a structured hiring process
• Structured hiring 101: Your blueprint for success

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