In addition to steering a business in a tough global economy, employers are finding it more difficult than ever to attract, retain, motivate and develop the best possible employees.

Your Employee Value Proposition (EVP) remains your biggest weapon when it comes to reducing resignations and improving the quality of new hires. In this context, your EVP is made up of all those attributes that existing employees and jobseekers perceive as the value that they will get from working at your organisation.

Your company’s EVP could make the difference between winning or losing the talent war. This is particularly relevant now: working from home during the Covid pandemic showed the best candidates that they could achieve work-life balance and no longer had to be in the office five days a week.

Why are employers still struggling to design a compelling EVP?

Despite the many initiatives implemented to improve the full package of monetary and non-monetary employee benefits, HR professionals and employers continue to find it difficult to compete for talent.

Employers have to do more than just pay competitive salaries, though this appears to be a prerequisite, given the financial challenges that employees face. The broad definition of pay must be expanded to look at total rewards and to effectively communicate the company’s reward philosophy to all employees.

Non-monetary rewards and, in particular, the work environment and work-life balance are influencing employees’ decisions to either stay or leave an employer. These factors are increasingly emerging as the most critical deciding factors for successful talent acquisition and retention.

Performance management is another often overlooked aspect of an employee’s work experience – one that has critical importance to high performers. And yes, it has changed significantly over the past few years – employers who now have detailed discussions with employees during the performance period have seen some results.

High performers do tend to seek out and thrive in a pay-for-performance environment, and are therefore likely to leave organisations that don’t adequately recognise and reward their contributions when compared to those of average performers.

Finally, the diversity of your organisation matters. This is not a one-size-fits-all approach and you cannot simply create boxes and expect most of your employees to fit into them. Knowing your employees and their preferences is crucial to getting their buy-in and an understanding of your EVP. What is a hot button for some won’t necessarily be so for others.

Once you understand the gaps you can also use information from employees’ exit interviews to establish what needs to change, and prioritise those that will make the biggest difference.

How to justify a higher employee cost to decision-makers

Of course, you need to assess the cost implications, which is often the most difficult to sell in a constrained economic climate. The best way to persuade your board and remuneration committee is by demonstrating future returns on the investment.

If your analysis indicated that your organisation’s total rewards package is competitive, you should consider your company culture. (Read more in ‘Will your company culture pass the Covid test?’)

Here are a few practical questions to ask that will help to boost your competitiveness in terms of company culture, making your company a more attractive employer:

• Are you delivering what you promised during the interview process?
• Do you have an inclusive and transparent culture that inspires high performance? If you don’t, conduct employee-engagement surveys to establish whether there are cultural and psychological safety issues that need to be addressed.
• Are you really listening to your employees?

In the aftermath of the pandemic, significant power has been transferred to highly skilled and high-performing employees. Ignoring the signs could have disastrous consequences for any organisation’s long-term strategy.

Listen to our Big Business Insights podcast episode with renowned futurist Dr Roze Phillips. You’ll find out what trends are shaping the future workplace and who she has her money on in the tug-of-war between employees and employers.

3 steps towards a more competitive rewards package

1. Analyse your total EVP. This includes remuneration, variable pay, medical aid, retirement funding, risk benefits and any other cash and non-cash rewards. Don’t forget about training, upskilling, diversity and flexibility in terms of working from home (or anywhere, for that matter).

2. Compare your total rewards to those of competitors’ and global best practice. Benchmark your offering to that of your industry sector and research global trends. Bear in mind, however, that many talented or highly skilled workers aren’t restricted to one industry. Therefore also consider other markets or employers in other industries that are competing for the same talent.

3. Identify risk areas based on your employee population and the skills your require not only today but also to take your business into the future.

This article originally appeared in Remchannel’s quarterly magazine for HR and rewards professionals, HR Quarterly.