Transcript
Mark:
Welcome to PeopleTech, the podcast of the HCM Technology Report. I’m Mark Feffer.
Today I’m talking with Dan Kessler, the president of Energage. They research and analyze employee sentiment with an eye toward its use in employer branding. We’re going to talk about how hiring has changed and the impact that it’s had on employer brands. What makes a top workplace and things to consider when telling the story of your culture. All that and more on this edition of PeopleTech.
Hi, Dan. Tell me briefly about Energage.
Dan:
Yeah, so a few things about Energage, Mark, that I think are important for you and the audience to know. First and foremost is that we are a purpose-driven business. So our purpose is to make the world a better place to work together and that really drives and informs everything we do. I don’t know if you’re familiar with the B Corporation movement, which is really about focusing on not just profit, but also positive impact on society and the world at large. And so there are thousands of B Corps around the world. We were actually one of the first 20, so really proud of that. In terms of what we do, quite simply what we do as a business is we build and brand top workplaces, and the way that we do that is we gather feedback from employees and we turn that into value for the customers that we work with.
There’s really two fundamental ways that we think about turning feedback into value. The first is one that’s probably most commonly understood by folks, which is really focused internally on an organization’s culture. So think about you want to measure employee engagement, you want to understand what drives it, and you want to enable teams to take action to improve it. So that’s kind of internal value that we deliver through feedback. The thing that we do that maybe is a little less intuitive for folks is we take that same feedback and we almost turn it inside out so that customers can articulate their employer brand and what makes their culture unique to candidates.
Because what we believe is who’s better to share what makes a company unique and why a culture is a great place to work or a top workplace than the employees themselves. So we take that authentic voice of employee feedback and allow companies to articulate their employee value proposition by those who really know it best.
Mark:
Now you’ve begun to work with USA today on the Top Workplace list. So tell me how did that come about and what are you trying to identify? In other words, to you guys, what’s the top workplace?
Dan:
So I’ll answer that in a couple of different ways, Mark. So we’ve been recognizing top workplaces across the United States for really as long as we’ve been in business. So the roots of our company are really in this concept of employer recognition and providing that external validation that one is an employer of choice. So it’s really core to what we do. Until fairly recently we’ve always done that from a regional approach, so we have about 60 partnerships at the regional level with folks like the Washington Post, the Boston Globe, San Francisco Chronicle, Chicago Tribune, you name it, where once a year those publications are going to celebrate and honor the top workplaces in their region. And we have always been the research partner gathering that feedback and providing that research for our editorial partners to publish that data. What we’ve seen is that especially as the hiring landscape has changed, while certainly hiring is still very localized and there’s a big regional component to it, obviously as we’ve shifted to more remote work, hiring has become more diversified geographically.
So for a few years now we’ve been trying to figure out how to provide opportunities for companies to really talk about their employer brand and what makes them stand out on a national level. And we’ve been looking for the right partner to really help us amplify that and feel really fortunate that we’ve been able to link up with our friends at USA Today who are going to be publishing our Top Workplaces USA award winners this upcoming March.
Now you asked, I think a really important question, which is, so what does it take to be a top workplace and how do we figure that out? And we’ll go into a bit more detail on that in a sec, but just to kind of ground it, there’s a lot of different awards that companies can win for various things including for their culture. And if you think about it, there’s a few different ways that we’ve seen these awards be determined.
So one is essentially an essay writing contest, and typically that award goes to the company that has the best writers on staff. May or may not have anything to do with the culture, but they’ve got a really good writer. Second thing that you’ll see is more of a voting style. This probably dates me a bit, but like an American Idol type of reference or something like that, which is basically a popularity contest and typically it’s going to go to the company that has really affected marketing.
We take a different approach, which is we believe the best way to determine the quality of a culture is to simply ask the employees what they think of it and to use quantitative data that we’ve determined over our 15 years of research from 70,000 organizations, over 25 million employees as to how to measure employee engagement and maybe even more importantly, what actually drives employee engagement. And I’ll talk about that in a sec. But fundamentally, Mark, the way that we determine whether you’re a top workplace or not is because your employee said that you are based on quantitative data. If it’d be helpful, I can talk a little bit about what exactly we measure, but I just wanted to paint that picture that there’s different ways you can earn these awards and we believe it’s quantitative data from the employees themselves.
Mark:
What is it that you’re looking for? I guess what I wanted to ask was are there common themes that you’re finding among the companies?
Dan:
Yes.
Mark:
But let’s start at the beginning.
Dan:
No, no, that’s great. Let’s start at the beginning. So let me just walk you through what we measure quite simply because these are the criteria that we use to evaluate whether a company is a top workplace or not. We think about it in terms of almost a hierarchy or a pyramid, if you will, where the ultimate goal is to have engaged employees. And the reason for that is because lots of research out there, ours included, that shows that if you can improve employee engagement, you’re going to have better productivity, you’re going to have higher profitability, lower turnover, more efficient recruitment, all these things. The way that we measure employee engagement is really three things. It’s motivation, so am I motivated to do my best work? Am I loyal, so am I looking for another job? And then referral, so am I sort of that employee net promoter score? Am I willing to refer a friend or colleague? And it’s this concept of say, stay, strive is how we think about employee engagement.
Now those three components are in and of themselves not actually very actionable. They’re more outputs of a really strong culture. So our research and what we’ve honed in on over the years is what are the things that are most closely correlated with that output of employee engagement? And frankly, what are things that are going to be actionable for companies? And that’s where we think about it as this hierarchy that really builds on the employee experience. So first and foremost is really the individual employees experience, which is about things like pay, benefits, work-life flexibility. It’s very personal to that individual employee’s experience in an organization. And what we’re looking for there is are employees essentially fairly valued.
The next thing we look at is really more about the relationship of the frontline manager and the individual employee. So it’s things like, do I feel appreciated? Is the company open to my ideas? Am I getting training? Am I learning? Am I growing? Things that really tend to take place within that relationship of the frontline manager and the employee. And then the next level up are things that tend to be more influenced by senior leadership teams and executive teams. So things like are we aligned around the direction of the business? Are we operating by strong values? Is there a sense of meaning in our work? And then similarly just how does the work actually get done? A lot of that comes down to communication. Do we communicate up in terms of senior leaders actually understanding what’s really going on, on the front lines and are we communicating down so that I as a frontline employee, do I actually understand and feel informed about what’s happening in terms of things that impact my role?
And then just basically is it easy to get work done or is there just a lot of friction in the organization in terms of how we just work with each other both within our teams and across departments? So all of those components, Mark, over the years we’ve really refined literally how we word the statements to determine what’s most closely correlated with engagement. And part of our proprietary methodology is that we then look at all that data quantitatively, come up with a score to then determine where are the top workplaces across the country. And part of what we’re able to do is benchmark that by industry, by company size because again, this may be obvious to you and your listeners, but frankly it’s more difficult to maintain a strong culture as you grow.
The reason we don’t survey 10 person companies because it’s like you should just be able to get into a room and have a conversation with 10 people. Again, not easy. Once you have two people working together, there can be complexity, but there’s a big difference in terms of what it takes to maintain a strong culture at 50 people versus 500 versus 5,000.
Mark:
The companies that you’ve got, that you’ve listed, it’s a pretty wide variety of sectors and industries. It seems like there’s certain things that are common among all of these companies, which makes me think that if you’re going to be an engaging employer, if you’re going to have a good culture, that’s not something that’s necessarily industry specific. It’s really more about human nature. Am I right about that?
Dan:
Yes and no is of course the answer. So you’re right about that in the sense that when we look at the things that we measure that are most closely correlated with engagement, basically a lot of those things that I just mentioned specifically around the strength of a manager, around clarity of direction, around appreciation, around values, those things are important regardless of industry, regardless of company size. So there is absolutely some consistency, which is why frankly we measure the same statements as core regardless of the industry and company size. That said, I think we recognize that as leaders, you need to be cognizant of your business strategy, your unique culture. And I’ll give you just a real example of that. Part of what we do is we do a lot of work with quantitative data. Obviously that’s the core of our business. That’s what determines top workplaces.
We also collect a lot of qualitative data in that we get a lot of open-ended employee comments that we are able to deliver for both sides of that value that we talked about, both the positive stuff of externally celebrating what your employees love about your culture as well as areas for improvement and opportunity. And we run essentially some sentiment analysis to understand common words and themes that come up. And the way that we like to articulate this is imagine there are some really unhappy employees because, and they use the word, “This culture is too fast-paced and I don’t like it, it moves too fast, we change too quickly.” Well, if you’re in a high growth tech company for example, that comes with the territory. So it may just be you don’t like that, but it may just be that that’s what that culture needs to deliver on that strategy. Whereas a government agency, for example, is maybe not aspiring to be fast-paced and having lots of change or a security agency or whatever it is. So as you get into some of those nuances about industry, what we’re always trying to do is connect that feedback to what the business is actually trying to accomplish. It’s not feedback in and of itself, it’s about what are our goals, both from retaining the current team as well as trying to find the right best talent to drive the business forward.
Mark:
Now you think a lot about employee branding, I’m sorry, employer branding.
Dan:
Employer, yeah.
Mark:
And I’m wondering how does all of this fit into an employer brand? Put another way, how should companies be thinking about the questions you’re asking and how they fit into employer branding?
Dan:
Yeah, so a couple of things on that. Over the years that we’ve been at this, there’s one thing that we’re just seeing, Mark, and I assume you’re seeing the same thing, it’s just an increasing awareness of employer brand, that it’s an important thing that requires time and energy from HR teams, marketing teams, executive teams to really frankly have a point of view on what your employer brand is and put time and energy in that. So just know that in general, that’s something that we’ve been thinking about a lot for a long time and we feel like the market is starting to catch up in terms of putting focus on it.
What’s really, really interesting, and this is some recent hot off the presses research we’ve done, is there seems to be a little bit of a disconnect in terms of how employers feel they’re doing at communicating their culture to candidates versus what candidates are experiencing. And the data we have that supports that is that we asked both employers and job seekers whether they feel the company culture is clearly articulated in the hiring process. So we asked, “Is your culture being clearly articulated?” And what do you think happened? Well, 80% of employers said, “Absolutely.” We’re nailing it. We are clearly communicating our culture. Candidates understand it in the application process. Guess how many job seekers felt it was being clearly communicated? 30%. So that I think shows that folks are thinking about it, but there still is this disconnect between what’s actually happening on the ground. And that’s where what we believe, and just our point of view on this is you can say on your website, people are our greatest asset. We’re an employer of choice, we have all these perks, all this kind of stuff. None of that is differentiated or unique to your actual company.
And so where we love doing and have seen a lot of positive feedback from is saying, “Look, here’s what your employees had to say.” Even in cultures that, look, no culture is perfect. To your point, it’s human nature, we’re always going to have work to do. But even in cultures that may feel like they’re really struggling, there’s lots of challenges in their day-to-day, I can guarantee you there are some positive things going on in that organization. There are some things about that culture that are unique that are worth celebrating, and that what we find is using that voice of employee as the catalyst as the key foundation of your employer brand is going to accelerate your ability to draw in talent that’s going to build that culture and shape that culture.
Mark:
How do you think employers can best convey this message? Is it about content marketing about the workplace? Is it one-on-one conversations with recruiters? Is it a mix of all of this?
Dan:
So I think it is certainly a mix of all those things. And again, I think this is where first and foremost from our perspective is you need to be thinking about it and spending time on it. I think what we see often is what I would call post and pray, which is we write a job posting, we have a careers page, we put a bunch of stuff out there, we see what comes in, as opposed to really being thoughtful about what is the message that we’re getting out there around not just what it’s like to work at this company, Mark, but what’s it even like to work in this specific department? And that’s one of the other things that we’ve been doing that’s been really interesting because we also recognize that while in any organization of scale, there’s certainly a prevailing culture, but it is different to be a software engineer than a salesperson, than a back office person.
And so oftentimes those functional teams or geographic teams by location, there’s some unique elements to those cultures. And so what we don’t often see and what we’ve been really having, again, some success and some fun working on is working with recruitment and talent acquisition teams to say, “Tell us about that team in Houston and what makes that team unique. Tell us about the culture of your engineering team and what drives them.” And let’s again, use that voice of employee feedback to articulate that. From what the actual tactics are, Mark, I don’t think there’s any magic to that in terms of you want to have social media presence, you want to find your job seekers where they are. From our perspective, it’s more how can you get more and more authentic? And I guess, yeah, basically just get more authentic with the content itself so it speaks from the voice of the employee because people can see through the noise these days and if they feel like they’re being sold to, it’s not going to resonate, they want to hear the real deal.
What was actually surprising to us, Mark, is we even have some companies who I wouldn’t say air their dirty laundry, but we’ll say, “Here’s some things actually we’re not that good from a culture perspective or we’re working on and just know that we prioritize this over that, so that’s who we are. So if that thing is really important to you, just know that that’s not going to be a focus here.” And that was really a surprise because we thought everybody would just want to share all the good stuff. And I think some organizations as we try to increase transparency are just being transparent about the culture as well. We think also a lot about what’s important to job seekers before they accept a job, and then what’s important to them after they land.
And then from the employer’s perspective, how can they best get a new employee off and running? And that’s again, where I think how we articulate the culture of the organization really comes into play. And so first, from the job seekers perspective, one of the things that we see is that when you’re in that job seeking mode, when we talked about those fairly valued components of pay and benefits and work-life flexibility, they’re actually really important in the recruiting process. And understandably, folks spend a lot of time and energy thinking about that, and employers spend a lot of time and energy thinking about that. What happens once they cross the threshold and enter the organization is those components become a lot less important, and our data proves that over and over again. And you’ve seen the stats that you have to pay somebody basically more money to work at a really unhealthy culture essentially. And it’s those things that we talked about, about clarity of direction and values and meaning that become much more important when the job seekers in the door.
Similarly, from an employer, the better job that I as an employer can do, articulating what our culture is really like to that job seeker, the more one, frankly, just the quality and success of my hiring is going to go up because presumably I’m going to screen out people who say, “Yeah, that’s really not quite what I’m looking for.” In addition, when that employee arrives, presumably in addition to your onboarding program and all that, they’re going to be able to hit the ground running because they’re going to say, “All right, I know what I’m getting. This is a fast-paced organization. I got to be ready to run and here’s what’s expected of me.” And so that’s, I guess, another component that we’re thinking about in terms of how to make sure that as we communicate what the culture is really like through the voice of employee, that it can enhance the job seeker employer experience really all the way through that journey.
Mark:
Take me through the candidate’s perception of all of this. I think you may have touched on this a bit, but when an employer is trying to get their brand message across and they’re presenting all of these communications to the candidates, how are the candidates reacting to it? Are they feeling oversold to, or does it really depend on the execution? What’s the thing that should be going through the employer’s head as they plan this?
Dan:
It’s an awesome question, Mark, and I think what we know is going on today a lot is that what job seekers are doing is they’re going to a place like Glassdoor and they’re reading what’s on there. What we know and what HR teams know is that, frankly, that’s an extraordinarily biased view of an organization’s culture. There’s no guarantee at all that those people posting on Glassdoor even ever worked at the company. So the job seeker we know is going and looking at some of these external sources. Now, if they’ve got that in their mind and what they’re getting from the employer is this generic, non-emotional, non-specific articulation of the culture culture, to your point, they’re going to just assume that what’s on Glassdoor is closer to the reality than whatever the recruiting teams are trying to pitch to them.
On the flip side, if I’m an employer and I’m saying, “Let me show you this short video of this employee talking about their culture, let me share with you a couple of the things that our frontline employees have talked about this culture, and it’s raw and it’s unfiltered, and it’s not perfect, but it actually is real and it gives you a sense of what these people are actually like and what makes them tick.” As a job seeker, I’m going to have a much more balanced understanding of what this culture is actually like, and it’s the opportunity for the employer to counteract and combat some of these, what we believe are frankly more, not just biased, but just non-representative views that are out there that we know job seekers are going to be looking for.
Mark:
Well, Dan, thanks very much. It’s great to meet you, and this is really fascinating stuff. I hope you’ll come back and we can talk some more about it.
Dan:
Would love that. Thank you so much, Mark. Really appreciate you giving us this opportunity.
Mark:
My guest today has been Dan Kessler, the president of Energage, and this has been PeopleTech, the podcast of the HCM Technology Report. We’re a publication of Recruiting Daily. We’re also a part of Evergreen Podcasts. To see all of their programs, visit www.evergreenpodcast.com. And to keep up with HR technology, visit the HCM Technology Report every day. We’re the most trusted source of news in the HR tech industry. Find us at www.hcmtechnologyreport.com. I’m Mark Feffer.
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