CHAPTER-1

INTRODUCTION

1.1 Employer Brand- Meaning and Significance

This chapter provides the background and the relevance of this research. Definitions of the
terms constructs, items repeatedly used in the study are also explained along with the brief
overview of the research methodology used for carrying out this research.

Ambler and Barrow in 1996 published first article on “The Employer Brand”. It is defined as
“the package of functional, economic and psychological benefits provided by employment
and identified with the employing company” (Ambler & Barrow, 1996). Backhaus and Tikoo
in (2004) conceptualize the phenomena by creating a theoretical framework. Sullivan (2004)
opines that the employer branding is a “a targeted, long-term strategy to manage the
awareness and perceptions of employees, potential employers, and related stakeholders with
regards to a particular firm”. Martin et al. (2011) defined employer branding as “a
generalized recognition for being known among key stakeholders for providing a high quality
employment experience, and a distinctive organisational identity which employees value,
engage with and feel confident and happy to promote to others”. Backhaus & Tikoo, (2004)
defined Employer Branding as “the process of building an identifiable and unique employer
identity” and employer brand as “a concept of the firm that differentiates it from its
competitors”.

Moroko and Uncles, (2008) stated the meaning and importance of branding in organisational
sector. Gaddam, (2008 )study suggested that a brand has great impact on the company as an
employer, there is an emotional relationship between the employers and the employees based
on brand image. Backhaus & Tikoo, (2004); Gaddam,(2008); Barrow, (2008) study suggested
that organisations have realized the importance of employer Branding strategy in establishing
an image of attractive employer and attracting right employees.Lievens and Highhouse,
(2003) opines that competition between organisations are intense due to lack of employees
with right skills set . Catteeuw, Flynn, and Vonderhorst, (2007); Wickham and O’Donohue,(
2009) study suggested that the demand for skills and competency are changing due to intense
global competitions and technological changes. Ewing, Pitt, de Bussy, and Berthon (2002
)study suggested that demand for intellectual capital-a cadre of highly skilled, independent,
internationally marketable and mobile individuals is exceeding the available supply due to
changing demography. The creation and management of human capital is a critical
determinant for organisational survival (Taylor and Collins, 2000) as well as for sustained
competitive advantage (Pfeffer, 1994) . Hitt et al., (2001) study suggested that employees’
knowledge, skills and experiences are key resources that help organisations to achieve and
sustain competitive advantage. Axelrod, Handfield-Jones, & Welsh, (2001); Chambers,
Handfield-Jones Hankin & Michaels, (1998); Clarke, (2001); and Ewing et al., (2002)
suggested that the finding and retaining talented employees becoming a major priority for
organisation in knowledge based economies. Competition and lack of availability of highly
talented and skilled employees exist (Kogut and Zander, 2003). The innovative recruitment
practices embedded in the human resource strategy provide organisations an edge over their
competitors in attracting employees with the required competences (Bhatnagar & Srivastava,
2008) and in creating reasons for top talent to choose their organisations.Some of the
innovative recruitment practices used by the organisations include golden handcuffs
(Sengupta et al, 2007), recruitment through blogs & networking sites (Parker, 2008)
recruitment of retired people housewives/ ex employees (Wolff, 2004) etc. Organisations are
using different benefits and amenities as baits to target the talent (Bhatnagar, 2003).
However, mere enhancements of benefits have resulted in mimetic isomorphism (DiMaggio
& Powell, 1983) where all organisations are striving to add value to the employment
experience. Carlson, Connerley, & Meacham, (2002) gave maximum importance for
promoting recruitment & selection effectiveness, for good applicant’s experience. Rynes,
(1991 )Study suggested that general impression of the attractiveness of the organisation is
important for initial application decision. Turban, (2001) suggested that the impressions of
the hiring organizing can become important cues for individual’s attraction towards the
organisation.

Employer Brand has been explained here as a strategy of positioning employer organisations
in the mind of prospective employees as an employer of choice by promoting and developing
internal and external communications. Internal customer i.e. existing employees are the brand
ambassadors and their employment experience spread good word of mouth, which acts as a
communication tool to attract external potential applicants.Organisations are struggling to
establish their identity as the best place to work to attract the best fit applicants.

Definition of some of the terms frequesntly used in this research is as follows. Prospective
Employees are that segment of extended labor market which has the right skills and
competencies to suit the business needs of the organisations and also fits into its culture and
values.Prospective Employers are those organisations which a person aspires to be a part of,
which fulfils one’s expectations and also suits one’s personality and values.Employer of
choice (EOC): Employer of choice programs are designed to aid an organisation in
outperforming its competition in the recruitment and retention of top talent in order to secure
an exceptional workforce (Lenaghan and Eisner, 2006; p99).As long as the knowledge-based
economy and the war for talent continue, more and more organisations are adopting the
strategy to become an employer of choice to attract high quality applicants (Gubman, 2004;
Lenaghan and Eisner, 2006).Employer attractiveness has been defined as the degree to which
a respondent would personally seek an organisation as an employer (Turban and Greening,
1997).Organisational communication strategy has also been considered as an important
construct of employer branding after extensive qualitative study .Following list has
mentioned different items under communication strategy and media.
1.2 Relevance of Research on Employer Brand
Traditional recruitment strategies cannot work in today’s dynamic business environment (Ind,
2001). First, every organisation has the ever existing certain hard to fill vacancies for which it
has to compete fiercely to attract prospective employees even when the unemployment rate is
high. Second the most sought after highly skilled employees would always have enough
choices to critically investigate & compare prospective employees (Jamrog 2002; Srivastava
& Bhatnagar, 2008). Ewing et al, (2002); Ployhart,( 2006) study suggested that in
professional knowledge based, technical & service driven organisations talent are in short
supply. Bergeron, (2001a), Ployhart (2006) study further suggested that employers have to
work harder to attract & retain them resulting in a “War for talent”. Collins & Stevens, (2002)
studied that demographic trends indicate that recruitment will be even more important in the
future. These trends include more mobile workforce , birth rates decreasing and an ageing
population in the western countries while younger workforce in countries like India (Kamdar,
2007), emigration (Minchington, & Thorne (2007).

Ambler and Barrow (1996) proposed that, the companies (Employer) should develop
strategies as their brand to attract the new employees and retain the existing employees.
Society for Human Resource Management, (2008 ) suggested that human resource process of
the companies uses the employer brand for three main reasons such as (a) organisational
culture and employee fit; (b) positive outcomes for recruiting and (c) retaining talent with
corporate values and a team-based culture. Google, have strong employer brands, and their
goal is to ‘live’ the brand (Kumar, 2009a, 2009b).Generally Google holds the rank of top
five in the great place to work study because of its nurturing and empowering attitude
towards employees.Gaddam, (2008 )study suggested that the business environment in which
organisations act is dynamic and acquisition of competent employees with technical skill is
vital, and since the competition among organisations for qualified human resources is intense,
companies need to distinguish themselves from others.So this study was planned to
understand the perspective of employers and employees for developing employer brand
framework for prospective employees.

1.3 Employer Brand in India

Indian organisations have also started to understand the benefits of employer brand. Many
organisations have started managing their employer brand to attract skilled and eligible
employees towards their companies. Indian talent has high demand in global employment
market and multinational organisations are trying to understand the perspective of an Indian
employee for the development of employee value preposition. It will prove beneficial for the
organisation to customize their human resource management strategies from an Indian
perspective. There is a lack of empirical research on employer brand from employer and
employee perspective .Literature exist on this topic but extensive empirical research is
required to be done for exploring right strategies. This research has tried to understand and
explore employer brand dimensions from both employer and employee perspective.

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Organisation can be an employer of choice by incorporating employer brand strategy for
talent attraction and retention. Employer branding can be helpful to propagate positive and
transparent message about organisations. Bhatnagar (2009) study affirmed that, the employer
brand is an important differentiator in India for talent management. The value of the
employer brand in India is multifaceted. It is the high time for Indian organisation to realize
the importance of employer branding strategy for talent management and business
sustainability.

1.4 Employer Brand from Employer’s Perspective

Employer Brand communicates the unique employment proposition of the organisation to
prospective hire, it creates an image of the organisation as a distinct and desirable
employer(Ambler and Barrow,1996;Backhaus and Tikoo,2004;Balmer and Greyser,2002)and
as good place to work (Bergeron,2001a;Sullivan,2004).Many organisations expanding
considerable resources on development of employer brand programme indicating its value
(Backhaus & Tikoo 2004). Christopher, Payne & Ballantyne (1991); Morgan & Hunt (1994),
stated that employer branding identify the need to build acquisition and retention strategies.
Backhaus and Tikoo (2004) stated that employer branding is a three-step process, first step is
to determine value proposition by the audit of the characteristics that make the firm a great
place to work, and an organisation develops particular value propositions that provides the
central message to the prospective and current employees. Second step is to market value
proposition externally to attract the talent pool final step involves carrying the brand"
promise" made to recruits in to the firm and incorporating it as a part of the organisational
culture. Berthon et.al al. (2005) study of Hewitt Associates, a human resource consultant
suggests five steps to develop a strong employer brand: (1) understand organisation, (2)
create a 'compelling brand promise' for employees that mirrors the brand promise for
customers, (3) develop standards to measure the fulfillment of brand promise, (4) ruthlessly
align all people practices to support and reinforce brand promise, and (5) execute the measure
.Organisational attraction study helps to develop insights about employer branding (Barber,
1998).

1.5 Employer Brand from Employee’s Perspective

The employee-based brand equity is increasingly recognized by financial markets, and human
capital constitutes a part of the market value of an organisation (Cairncross, 2000). From the
employees’ context, brand equity can be defined as ‘the effect of brand knowledge on
potential and existing employees of the firm’ (Backhaus and Tikoo, 2004). Employees are the
biggest asset of the organisation. Satisfied employees can prove competitive advantage as
they deliver positive service experience to customers.De Chernatony,and Harris, (2000)
opines that for competitors, copying intangible brand characteristics are difficult than the
operational components of a service brand experience. Michelli (2007) study on Starbucks
experienced that the emotional bond that loyal Starbucks customers feel is the personal
investment of Starbucks partners. An observation that has been confirmed many times by the
Starbuck’s founder, Howard Schultz, who claims: ‘The most important component of our
brand is the employee. The people have created the magic; the people have created the

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experience’ (Smith, & Wheeler, 2002). Some of the other researcher (e.g. Kunde, 2000:
‘Corporate Religion’; Milligan, & Smith, 2002) also provided some examples in this regard.
So this study has tried to see different dimensions and communication strategy of employer
brand and its relation with personality types of prospective applicants.

1.6 Purpose of the Study

The focus of the present study is to study the, employer branding strategies from
organisational perspective i.e. what an organisation is doing to attract talent and to study it
from individual perspective i.e. what attracts an applicant to a particular Organisation. This
thesis conceptualizes and develops important attributes of employer brand dimensions
perceived by the prospective employees. It determines the strength of relationships among the
different constructs. The focus of this research was also to identify important communication
strategy for pitching the right prospective employees at the stage of recruitment. It has
explored the personality type of prospective employees and their relation with important
employer brand dimensions, sectors, industry .This study is consistent with the literature on
behavioral intentions (Berthon, Ewing and Hah, 2005;Highhouse et al.,1999;Knox and
Freeman,2006;Lievens et al.,2007 etc.) as perceptions rather than actual employment
decisions are examined. Employer’s perspective on three dimensions of employer brand has
also been explored.

1.7 Overview of Exploratory Research

This study was conducted qualitatively then quantitavely from prospective employer and
potential employee perspective. Data was collected in two stages exploratory qualitative data
analysis was followed by a conclusive quantitative approach an overview of the
methodologies adopted is given in the following sections. Questionnaires were framed for all
the qualitative study which are enclosed as Appendix A to H

Exploratory Study (qualitative)

Prospective Employee Prospective Employer

• Group Discussion • Content Analysis of

• Open ended questionnaires Corporate Websites
• Semi-structured interviews • Open ended questionnaires
• Focus Group discussions • Semi-structured interviews
• In depth interview • Focus group discussion
• In depth interview

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Fig 1.1: Qualitative Research Design for this Study

The Exploratory Study comprised of different methods .Corporate web content analysis of
around fifty organisations from different sectors and industry has been done. Semi-structured
depth interviews, focus group discussions and open ended questionnaires were administered.
Data was collected both concurrently and sequentially. The sample for the exploratory study
were postgraduate business management students from Universities of Delhi/NCR.Working
managers, senior human resource executives, manpower acquisition heads, consultants of
different organisations were the participants of focus group discussion and in depth
interview. Placement Heads and faculty mentors of colleges were also approached as they
frequently interact with potential employer and prospective employees.They develop sound
knowledge of employer’s efforts and prospective employee’s aspirations. The results of the
exploratory Study helped in identifying the key constructs & variables for this research,
which are discussed below.

1.8 Dimensions of Employer Brand:

Barrow, (2008) study suggested that Employer branding is an instrument in the recruitment
process to attract and recruit suitable people to the organisation. Moroko and Uncles (2008)
characterize successful brands by attractiveness and accuracy, which they claim is also
applicable on successful employer brands. Moroko & Uncles, (2008) opines that strong
employer brand is characterized by being known and noticeable, relevant and resonant, and
differentiated from its competitors. Maxwell and Knox (2009) suggested that the employees
consider different employer’s attributes in different companies. Maxwell & Knox, (2009)
further suggested that the perceived attractiveness by current employee is employment, which
strongly affects and it includes work environment, relations, management style, rewards, and
type of work and attributes of workforce. Bergeron, (2001b) concluded that employer brand
consists of many attributes. Cable and Graham, (2000); Cable and Turban, (2001); Highhouse
et al., (1998) determined the factors on which organisation’s employment image can be
examined. Rynes and Barber (1990) Lievens et al. (2005) established the dimensions
symbolic, instrumental components for students’ attraction to the Army. Collins and Stevens
(2002) suggested that organisation-based attributes had greater impact on prospective
employees than role-specific attributes. Lievens et al. (2007) studied the factors that attract
and connect employees towards an employer.

Bhatnagar & Srivastava study(2008) has suggested organisational reputation, people and
culture and human resource practices as three important dimensions of employer brand. In the
present study, the researcher took three similar dimensions of employer brand i.e.;
organisational reputation, human resource management process, and organisational culture
.Communication strategies adopted for employer branding has also been explored
extensively. Personality types of employees and its relation with other constructs have also
been evaluated. Further each constructs have been categorized into different items. All the
constructs and items have been evaluated from employers and employees perspective.

1. Organisational Reputation
a. Financial Performance

b. Market Success

c. Inspiring Top Management/Leadership

d. Vision & Mission

e. Social & Environmental Responsibility

f. Innovative/Interesting/Exciting Products and Services

g. Emotional Appeal

h. High Ethical Standards

i. Prestige of the company

j. Fast growing or entrepreneurial organisations

2. Organisational Culture

a. Culture of Respect and Trust

b. Friendly work environment

c. Work Life Balance

d. Creative & Dynamic Work place

 e. Offer interaction with international clients & colleagues

f. Team Spirit

g. Healthy and Competitive Environment

h. Workforce Diversity-Inclusive and Gender Sensitive Workplace

3.Human Resource Management Processes

a. Recruitment and Induction Processes

b. Compensation and Benefits

c. Training and Development Programmes

d. Recognition , Rewards and Incentives Programmes

e. Job characteristics attribute ( Nature of Job)

f. Professional Advancement Opportunities

g. Leave Provisions (Child Care, Sabbatical etc.)

h. Performance Management

i. Talent Management initiatives

j. Succession Planning
 k. Job Security

1.9 Constructs of this Research

1) Communication Strategy

a. Word of Mouth

b. Employee Testimonials

c. Employee Referrals

d. Events

e. Media

1.1 EVENTS

a. Trade Shows

b. Alumni Meets

c. Organizing Workshop, Seminars, Presentations, Talks

d. Career Fairs

e. Employee Branding Campaign

1.2 MEDIA

1.2.1 Digital communication media

 a. Corporate Website

b. Career Portals

c. Company & Employee Blogs and Forums

d. Professional / Social Networking Sites

e. T.V and Radio Commercials

f. Live Webinars with Employers

g. Direct Mailing

h. Mobile Apps/Instant Messaging

i. Promotional Videos

j. Company Presentations

1.2.2 Print media

a. Newspaper Job Advertisements

b. Corporate Brochures

c. Career Magazines/Journals

d. Banners
 e. Editorial News Articles about the employer

f. University Press & Student Organisations publications

1.10 Introduction of the Constructs:

1) Organisational Reputation

Kowalczyk & Pawlish, (2002) defines Reputation as a perceptual judgment of organisations

past actions developed over a period of time which helps to attract talented people to apply
for the posts.Wartick (1992) defined organisational reputation as “The aggregation of a single
stake holder’s perceptions of how well organisational responses are meeting the demands &
expectations of many organisational stakeholders”

Fombrum (1996) defined organisational reputation as “A perceptual representation of a

company’s past actions & future prospects that describe the overall appeal to all of its key
constituents when compared with leading rivals”.

Chauvin & Guthrie (1994) defined organisational reputation “Information about an

organisation that develops over time from observed behavior about the characteristics of the
organisation”. Dukerich & Carter (2000) defines it as “An outsiders perceptions of an
organisation”.

In the present study the researcher taken these ten sub-divisions of Organisational reputation-
Financial Performance, Market Success, Inspiring Top Management/Leadership, Vision &
Mission, Social & Environmental Responsibility, Innovative/Interesting/Exciting Products
and Services, Emotional Appeal, High Ethical Standards, Prestige of the company and Fast
growing or entrepreneurial. All the items have been explained in the literature review.

2. Organisational Culture: Organisational culture creates an identity of an organisations by

legends, rituals, beliefs, meanings, values, norms and language .Numbers of studies already
proved the role of organisational culture and the organisational attractiveness. Globalization
has led to the blending of work cultures from East and West (Saini, & Budhwar, 2004).

Organisational culture is sub divided into 8 items. These are Workforce diversity
Inclusive and gender sensitive workplace, respect for individuality, friendly work
environment, work Life balance, creative & dynamic work place, offer interaction with
international clients & colleagues, team spirit and healthy and competitive environment.

3. Human Resource Management Process: Organisational attractiveness to prospective

employee is being explored by human resource professionals and practitioner (Barber, 1998).
Cappelli,( 2005) opines that ‘talent-raiding’ and ‘talent poaching’ strategy is also being done
by the organisations which are struggling to be seen as an employer of choice (Jamrog,
2002).The Human Resource profession in India began in the 1991, the importance of the
human resource function dramatically increased because of transformation of external
variables. Human resource management is essential for business survival. Kumar, (2009a,
2009b) studied that progressive human resource process and terminology has developed after
the arrival of multinational corporations (MNCs). Human resource management is evolving
and getting more sophisticated by including best human resource practices of east and west.
Backhaus & Tikoo, (2004); Barrow, (2008).Sullivan, (2004) opines that the key human
resource consultants predict a strong upward movement for employer branding, may be due
to the shortage of qualified human capital in labor markets, which has been observed in
recent years (c.f. Buck & Dworschak, 2003; Gaddam, 2008; McKinsey & Company, 2001).

Human resource process is divided into eleven categories.These are recruitment

and induction Processes, compensations and benefits, training and development programmes,
recognition, rewards and incentives programmes, Job characteristics attribute(Nature of Job),
professional advancement opportunities, leave provisions (Child Care, Sabbatical etc.),
performance management, talent management initiatives, succession planning, and Job
Security.

4. Communication Strategies: Communication strategy is a vital component for

organisational image projection. Employer branding strategies act as a communication tool to
portray employer core message to prospective employees. So promoting and developing right
employer branding strategies are required to win the quest of war for talent. Literature
suggests that employer branding is about communicating the employment message to the
employees.Print media is easily accessible and approachable source of employment
information. Organisations are using social networking sites for recruitment, social media
like blogs, have hired bloggers in order to reach out to the prospective employees and
creating unique identity as an employer brand (“Linking Park” 2007). Social networking sites
like facebook, Myspace, Linked in Viadeo etc. being used as free online databases for
evaluating candidates (Parker, 2008). Communication strategy is further divided into Word of
mouth, employee testimonials, employee referrals, events, and media. Few of the research
within organisational communication described organisational association as self-significant
(Kuhn, 2006).

Papasolomou and Vrontis, (2006) affirmed that, in the organisational setting, internal
communication serves to ensure that employees as customers are aware of their role, the
employer’s expectations, and performance standards. Employees are also informed of the
employer’s obligations towards them, particularly compensation arrangements. A process of
negotiation between the organisation and the employee culminates in a mutually satisfactory
result and a relationship that is predominantly transactional (Stanley, 2011). For this reason,
responsibility for internal communications falls to the human resource department as it is this
department that also has the responsibility for administering the contract, including rewards
and sanctions. Burmann and Zeplin, (2005) and Rafiq and Ahmed, (2002) confirmed that
communication strategy adopted by the firm should be one that is intended to encourage
psychological and emotional buy-in.

5. Big Five-Personality Inventory

Employees are the best asset for organisation .People make the place,” what kinds of people
(personalities) fit into what kinds of places (organisations) is required to be understood for
talent attraction and retention. Big 5 Personality inventory questionnaire has been used to see
the placement preferences according to personality types. Costa and McCrae (1995)
developed the big five inventory to assess different personality type. Big five personality
inventory is one of the important tool for the measurement of personality especially in
organisational and industrial sectors. It can be very effective tool in deciding right employers
from prospective employee’s perspective and right employees from potential employer
perspective. Right fit applicants have longer retention and better satisfaction in the
organisation. Higher profit and growth can be projected, as happy satisfied employees are the
productive employees. It will also help in reducing manpower acquisition, training and
retraining cost. Candidates may also opt out of completing the recruitment process if they
perceive the conditions surrounding the job offer to be incompatible with their interests,
abilities, personality, and values (Burmann & Zeplin, 2005; Farrell & Oczkowski, 2009). Big
Five personality inventory included five factors i.e.; e Extraversion, Agreeableness,
Conscientiousness, Neuroticism and Openness to experiences. Thus exploring the personality
types of employee will help in customizing employer brand framework.

1.11 Quantitative Study

Qualitative study helped in identifying constructs, items to develop questionnaire for
quantitative study. Questionnaire was administered on employers and employees. Collected
data was analyzed with the help of SPSS.Analysis of result helped in proving hypotheses and
writing discussions and conclusion.