When it comes to hiring, social and emerging market entrepreneurs are the ultimate underdogs.
Entrepreneurs building impactful companies are in need of hiring qualified, skilled candidates, and their biggest challenge — by far — is limited budget. RippleWorks’ global research survey found that 64% of social and emerging market entrepreneurs are being outpriced by competitors for top talent.
Competing for top talent solely on compensation is a losing battle for such entrepreneurs, especially against better capitalized corporations. So what can entrepreneurs do to attract and hire the talented employees they need to scale their companies?
According to experts, it all starts with building and articulating a winning employee value proposition.
What is an employee value proposition?
Put simply, your employee value proposition (EVP) is the argument why you — and only you — are the ideal working environment for an employee. It meets all the needs of a potential employee by highlighting the strengths and benefits of your company: everything from company culture to training opportunities to brand appeal.
“Every organization, whether they realize it or not, has an employee value proposition, even if it’s not stated,” said Omidyar Network Human Capital Partner Sal Giambanco. “What we’re really talking about is mindful intentionality in defining the employee value proposition, and using it to attract talent.”
Research from the Corporate Leadership Council found that building a well-thought out EVP can improve the chances of hiring a potential employee by 29%, and reduce new hire compensation premiums by 50%. A strong EVP can also increase the likelihood of employees acting as advocates for the company from 24% to 47%.
“As a startup, you have to think about pulling together a complete package to really attract the best employees,” said Fred Swaniker, a serial entrepreneur who has successfully built four companies across Africa. “We have some unique advantages over other organizations that might have deeper pockets than we do.”
What should entrepreneurs keep in mind when forming their EVPs? Giambanco and Swaniker shared their expertise during a RippleWorks webinar on Hiring & Developing Talented Teams.
1. Know what makes you great
Giambanco is no stranger to tough recruiting battles. Before running Omidyar Network’s Human Capital operations, Giambanco previously was the VP of Human Resources and Administration for PayPal and eBay.
Now, in his role at Omidyar Network, Giambanco works closely with social entrepreneurs to coach them in building sophisticated, inspiring EVPs. His advice is the same as the ancient Greek maxim: know thyself.
“The key questions I start with are: Do you know what you have? Do you know what your employees want?” Giambanco said. “I ask a CEO to tell me what the employee value proposition is in their mind, and I ask them, ‘Why do people choose to work for you?’”
Devoting the time to understanding what your employees value most about their working experience will not only help you build a more employee-centered company, it will help you attract key potential hires. A focused survey or a series of in-depth interviews can allow entrepreneurs to collect such insights from team members.
2. Build an EVP around your world-changing vision
Competing on compensation is an up-hill battle for social entrepreneurs, but when it comes to the company’s mission and vision, social entrepreneurs can be unbeatable.
“I think the most exciting value proposition is the chance to change the world,” Swaniker said. “People are attracted to big, bold visions and everyone is looking for meaning in their lives.”
Swaniker’s latest venture, African Leadership University (ALU), is trying to reimagine higher education by building what CNN recently deemed the “Harvard of Africa.”
“People want to be part of creating history, so you have to sell them that impact that they’re going to have and get them excited about creating something big and bold,” Swaniker said.
3. Highlight higher responsibilities
Swaniker has built his companies by successfully recruiting employees from Ivy League universities and top companies like McKinsey and Co., and Oracle.
The key, for Swaniker, has been realizing that talented, ambitious young workers are willing to walk away from high-paying jobs for the prospect of taking on more responsibility. Many will even move across the world for it.
“One of the things I use in negotiations to bring talent on board is the chance to let people assume roles that would have taken them twenty or thirty years in much more established organizations,” Swaniker said. “It’s a huge step up for them in their careers, which they’re willing to trade off for the compensation.”
4. Sell the freedom
Another major selling point for a newer organization is the luxury of not dealing with the bureaucracy of more established companies.
“Don’t underestimate what giving someone freedom is worth to them,” Swaniker said. “Some people may be working in an organization that is stifling their creativity.”
Entrepreneurs can take a page out of Swaniker’s playbook and pinpoint the differences in day-to-day work between your company and a major corporation to showcase the fast-paced, exciting nature of startup life.
5. Use empathy to tailor your EVP
What is attractive about your company can differ by each candidate. It is up to you to put yourself in his or her shoes to best position yourself as the ideal employer.
“A single person is going to have a different set of priorities with respect to the employee value proposition than someone who might be married with children,” Giambanco said. “They might emphasize, for example, more work-life balance.”
For his part, Swaniker builds empathy into every step of the recruiting process. Considering that African Leadership University is located in Mauritius, an island off the southeast coast of Africa, he often has to convince candidates to relocate for the job. ALU often brings the wives and husbands of potential hires to Mauritius to show them the schools, hospitals, and everyday life of Mauritius.
Having an empathy-driven approach to crafting your EVP for each candidate is important because of the pressure-filled nature of a job search.
“If one is relocating for a job, he or she is dealing with two out of the top three personal psychological stressors in life — a job change and a move,” Giambanco said. “As an employer, you first have to reflect on those stresses. Consider how those stresses apply to your candidate, and help the candidate by addressing these two psychological stressors head on.
“It’s important to recognize that as you’re recruiting a potential hire, what you’re doing is building a relationship.”