Employer Branding and Talent-Relationship-Management – Improving the Organizational Recruitment Approach
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UMEÅ UNIVERSITY Umeå School of Business Department of Business Administration Supervisor: Per Nilsson Master Thesis Spring 2007 Employer Branding and Talent-Relationship-Management – Improving the Organizational Recruitment Approach Author: Robin Jeffrey Katoen Andreas Macioschek ACKNOWLEDGEMENTS By the time we started working on our study, we were hardly aware of the journey lying ahead of us. Per, as our supervisor, tried to warn us about being overambitious with our research intention. True, the work has been hard but we have been convinced by the synergy effect, which is involved with working in a team. This ambition enabled us to accomplish both a quantitative and qualitative research approach within a limited period of time. We have to admit that we faced some serious challenges during the time we worked on our master thesis. But every time we overcame an obstacle, new energy was regained, which motivated us to continue. We found our devotion in the quote: “Difficult takes a day, impossible a week.” Now, after ten weeks have passed, we are proud of and satisfied with the accomplished work. We hope that reading the thesis will be interesting and pleasant, since either most readers are about to graduate and will soon be in a situation, where Talent-Relationship-Management and Employer Branding might play an important role or are dealing with these concepts in a professional setting. However, we would never have been able to complete this master thesis without the contributions of many others. Therefore we would like to express our appreciation to all, which have played a role in the realisation of this thesis. In particular we would like to thank the interviewees at the participating companies: Alexandra Alfredsson (Volvo), Therese Karlsson (Swedbank), Sanna Östberg (Ernst & Young) and Elisabeth Österlund (ABB). Furthermore, we express our gratefulness to the respondents of our survey: Master Students at USBE as well as the scholarship holders of the VSB and Leonardo da Vinci Scholarship Program. We would like to thank our supervisor, Per Nilsson, for his feedback as well as Vladimir Vanyushyn for his patience and help concerning statistical questions. In addition, we would like to express our appreciation for the exceptional service of the Library of Umeå University, which purchased numerous books for us, which were not present in the collection. We would finally like to thank our fellow students for providing us with inspiration and relaxation and our wonderful girlfriends for their patience and love. “Tomorrow’s battle is won during today’s practice.” Samurai Maxim Umeå, May 2007 Andreas & Robin SUMMARY Apart from products, goods and capital it is the employees who are the biggest asset of an organization. They are the human side of a company, which create products and services that attracts customers. The importance of human resources gets even more apparent when taking into consideration today’s fast changing business environment and the increasing demand of a skilled workforce with valuable competences and expertise. However, due to an ongoing demographic change and increasing job mobility on the labour market, the recruitment of key-employees has become a challenge. To this end, there are two fairly new concepts in the area of Human Resource Management, which have the aim to differentiate companies on the labour market and to support them effectively in their endeavour to approach, acquire and retain the most talented employees. The Employer Branding concept, on the one hand, develops the corporate brand further and places the organization as a trustworthy and attractive company on the market. On the other hand, Talent- Relationship-Management creates an active relationship between an organization and in particular skilled applicants in order to sustain a pool of highly qualified candidates over a long-term basis. The two central research questions in this thesis are what does an effective Employer Branding strategy need to contain and how should the concept be managed in order to attract, recruit and retain a high potential workforce as well as how can the TRM approach be successfully managed and which instruments are essential to sustain a pool of highly skilled and motivated candidates over a long period of time? The first purpose of this study is to investigate the internal and external determinants, which form an appealing employer brand. The second objective is to gain a deeper understanding of the prioritisation of different Talent-Relationship-Management instruments, which are important to build a long-term relationship with talented candidates. The empirical findings should contribute to the development of theory as well as to derive practical implications for companies in order to extend and develop their organizational recruiting strategy. To this end, four semi-structured interviews with exceptionally successful companies in the field of Employer Branding have been conducted. Furthermore, a web-based questionnaire among students and recent graduates facilitated the empirical data collection about the perception of Talent-Relationship-Management instruments. The conducted interviews, which focused on the Employer Branding approach, led to a modification of the initially constructed conceptual framework. The major findings outline that there is a continuous challenge in balancing the actual and desired corporate image, while the Employer Branding concept aims to create consistency in favour of a credible employer brand message. In addition, the employer brand plays an important role in preventing unplanned impulses, which result out of negative impacts from the business environment. Commitment among the employees is achieved through instruments of the Total Work Experience . Through development seminars, the culture and values of a company are emphasized, which appears to be interrelated with an increasing level of loyalty among employees. In addition, committed personnel do not only play an important role in achieving satisfied customers, but they also act as brand ambassadors by communicating a true picture outside the organization. In order to find an answer to the second research question, a web-based questionnaire was sent out to 518 students and scholarship holders in Sweden, Germany and The Netherlands. The comparison of the major findings among the different groups shows that there is a rather consistent pattern in the perception and ranking of the instruments. However, the instruments ‘Information about vacancies’, ‘Scholarship’, ‘Company Workshops’ as well as ‘Exclusive Information’ are among the most valued ones in comparison with ‘Periodical Services’, ‘Personalized Websites’ or ‘Giveaways’, which most respondents do not perceive as interesting. In an effort to classify the 19 instruments in a more consistent way, a four-field matrix has been derived, which should help organizations in their endeavour to find a more appropriate ‘set of TRM tools’. The results also indicate that there has rarely been any experience with any of the TRM instruments, while there is a clear opinion in favour of an extension of the concept. This demonstrates the potential of the concept and should therefore be reason enough for companies to intensify their effort towards the TRM approach. TABLE OF CONTENTS i TABLE OF CONTENTS LIST OF FIGURES AND TABLES.....................................................................................IV LIST OF ABBREVIATIONS................................................................................................. V 1. INTRODUCTION................................................................................................................ 1 1.1 BACKGROUND ................................................................................................................... 1 1.2 PROBLEM STATEMENT ....................................................................................................... 2 1.3 RESEARCH QUESTION AND PURPOSE OF THE STUDY ......................................................... 2 1.4 DEMARCATIONS AND LIMITATIONS ................................................................................... 3 1.5 DISPOSITION ...................................................................................................................... 3 2. RESEARCH CONSIDERATIONS .................................................................................... 4 2.1 CHOICE OF SUBJECT .......................................................................................................... 4 2.2 THEORETICAL AND PRACTICAL PRECONCEPTIONS ............................................................ 4 2.3 EPISTEMOLOGICAL CONSIDERATIONS ............................................................................... 5 2.4 SCIENTIFIC APPROACH ...................................................................................................... 6 2.5 RESEARCH APPROACH ....................................................................................................... 7 2.6 CHOICE OF THEORIES ........................................................................................................ 7 2.7 SECONDARY DATA COLLECTION ....................................................................................... 8 2.8 CRITICISM OF SECONDARY DATA COLLECTION ................................................................. 8 3. THEORETICAL FRAMEWORK ................................................................................... 10 3.1 HUMAN RESOURCE MANAGEMENT AND THE