Florentina Cindy Finishtya

THE DIMENSION OF EMPLOYER BRANDING:

ATTRACTING TALENTED EMPLOYEES TO
LEVERAGE ORGANIZATIONAL COMPETITIVENESS

JAM Ambara Purusottama

17, 1 Ari Ardianto
Received, October 2018 School of Business and Economics, Universitas Prasetiya Mulya, Indonesia
Revised, January 2019
February 2019
Accepted, February 2019
Abstract: The challenge to meet the fulfillmentofthe workforce needs in Indonesia in the
near future makes organizations immediately improve and use employer branding as an
instrument of organizational competitiveness in “the war of talent”. This research invites us
to explore the dimensions of employer branding and also examines the dimensions towards
talented local employees (students) in Indonesia. Our findings, three of five dimensions of
employer branding namely working environment, company reputation, and corporate vi-
sion provide a positive and significant influence on the interest of talentedlocal employee’s
career. Therefore, compensation benefitsand corporate social responsibility as part ofthe
employer branding’s dimensions are not considered by talentedlocal employees in their
intention to join the organization despite having a positive relationship. These findings
provide insight into the importance of employer branding in maintaining the competitive-
ness of companies by focusing more on the intangible dimensions.

Keywords: Organization Competitiveness; Employer Branding Dimension; Talent Employee.

Cite this article as: Purusottama, Ambara and Ari Ardianto. 2019. The Dimension of Em-
ployer Branding: Attracting Talented Employees to Leverage Organizational Competi-
tiveness. Jurnal Aplikasi Manajemen, Volume 17, Number 1, Pages 118–126. Malang: Univer-
sitas Brawijaya. http://dx.doi.org/10.21776/ub.jam.2019.017.01.13

Companies in Indonesia are though the education fund has been raised by the
starting to address the issue government and has been ratified in the constitu-
of fulfilling the quantity and tion. In the future, 55% of jobs in Indonesia will be
Journal of Applied
Management (JAM) quality of talented local em- administrative or managerial, compared to the cur-
Volume 17 Number 1, ployees at every level in the rent 36%. Indonesia has not been able to produce
March 2019
Indexed in Google Scholar
organization. The Asian De- university graduates of excellent quality to fulfil the
velopment Bank (2016), pre- available position.
dicts the condition of Indone- Employer branding conceptually provides com-
sian human resources in less panies with a strategic thinking framework where
Corresponding Author: than a decade into the fu- there is a collaboration between marketing and hu-
Ambara Purusottama, School
of Business and Economics,
ture will still not be able to man resource management (Maxwell & Knox,
Universitas Prasetiya Mulya, meet the needs of entry-level 2009). Thus, the organization can attract, maintain,
Indonesia, E-mail:
ambara.purusottama@pmbs.ac.id, positions especially in large and also be able to contribute as a motivator for its
DOI: http://dx.doi.org/ companies, due to scarcity of employees. Brands also play a major role inselection,
10.21776/ub.jam. 2019.017.
01.13 good quality candidates even and strong employer branding will contribute to the

118 JOURNAL OF APPLIED MANAGEMENT 118VOLUME 17 NUMBER 1 MARCH 2019

 The Dimension of Employer Branding: Attracting Talented Employees

development of good employee attitude(Berthon, talentedlocal employees towards their interest in

Ewing, and Hah, 2005). applying for jobs in the context of employer brand-
The current workforce challenge is how to ing.
obtainhigh-qualityand loyal workers. Therefore,
strong employer branding is increasingly becoming LITERATURE REVIEW
relevant intoday’s business. Companies that embrace Employer Branding
employer branding are companies that are well po-
Employer branding is a new idea that has been
sitioned to have a strong position in the competitive
tested by practitioners and academics in the fieldof
labor market (Cascio, 2014). In the past few
marketing. The term shows differences in the char-
years,studiesonemployer branding have not been
acteristics of the company as an employer from
widely carried outin Indonesia. In the previous
other competing companies. Employer branding
study,Amelia and Nasution (2016),provide insightinto
underlines the unique aspects of a company’s offer
the importance of employer branding in Indonesia
or environment (Backhaus & Tikoo, 2004). “Em-
particularly the war of talent inthe mining industry.
ployer Branding” as a concept borrowed from mar-
This study aims to explore and examine the
keting explains the level of attractiveness of an
impact of the perception of talented local employ-
employee and talentedlocal employees of the com-
ees on the five components of employer branding
pany. Employer branding helps organizationsfocus
which includes working environment, compensation
on how they can identify themselves in the market-
and benefits, corporate reputation, corporate vision
place as employersofemployees and
and leadership, and also corporate social and envi-
talentedemployees; for new recruitment as well as
ronmental responsibility towards theircareer inter-
suppliers or partners of customers (Lievens &
ests. Furthermore, this study also determines the
Slaughter, 2016).
individual factors that are considered important by

Table 1 The Dimension of Employer Branding

Employer Branding Dimension References

Working Environment Swider, Zimmerman, Charlier, and J.Pierotti (2015) and
Boamah and Laschinger (2016).
Compensation and Benefit Gilani and Cunningham (2017) andWidyaningsih (2016).
Corporate Reputation Biswas and Suar (2016) andJain and Bhatt (2015).
Corporate Vision and Leadership Wallace, Chernatony, and Buil (2013).
Corporate Social and Environmental Responsibility Biswas andSuar(2016) andJones, Wicks, and Freeman
(2017).

The main objective of the employer branding strategy. Employer branding places an image that
concept is to positively influence employees and shows the organization/company as “a good place
talentedlocal employees to attract high-quality em- to work”.
ployees (Saini, et al., 2013). The use of the prin- Many scholars stated that employer branding
ciples of branding in human resource management influences the success of the company to improve
is currently called “employer branding”. the quality and quantity of applicants. Many com-
Theincreasing use of employer branding concept by panies have developed formal employer branding
companies is to attract attention and ensure that all or interest in developing the program (Botha, et al.,
employees participate in the company’s culture and 2011). Since the company operates its operations in

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 Florentina Cindy Finishtya

a strong global competition, strong employer brand- Individuals will feel proud if they work and have
ing has become a crucial solution to improve excel- benefits which are in linewith their expectations.
lence in “the war of talent”. Strictly speaking,Gilani and Cunningham (2017) ex-
plain that individuals will feel more valued and have
Employer Branding in Indonesia a better attachment with the organization if they get
Employer branding in Indonesia has been initi- a better salary and other appropriate compensation.
ated by several large companies to obtain the re- Widyaningsih (2016),stated that other compensation
quired organizational assets. In the future, the role obtained includes health insurance, pensions, and
of employer branding will be increasingly crucial incentives in the form of bonuses. Therefore, the
given the increasingly scarce quality workforce and hypothesis that can be built is:
the limitations of the talented pool. Employer brand- H2: There is a positive and significant relationship
ing strategies are becoming important with the in- between the perception of talented employees
creasingly fierce industrial competition in Indone- of compensation and benefits towards the in-
sia, particularly in several industries that require tention to apply for a job.
specific quality workforce such as in the banking
and mining sector. Corporatereputation has a significant influence
A study fromKusuma and Prasetya (2017), on the company’s talented employees (Biswas &
found that PT Bank Central Asia Tbk (BCA) real- Suar, 2016). Biswar and Suar also argue employee
ized the importance of employer branding and will feel proud to be able to join a company with a
formed an employee value proposition to create high- good image or reputation. Jain and Bhatt (2015),in
quality employee engagement. In other sectors such their study found that for career choices in compa-
as mining,Amelia and Nasution(2016), emphasize nies, individuals will consider several interests that
the importance of employer branding in the face of have a positive impact on themselves, among oth-
competition for prospective employees. Both of them ers, the reputation and stability of the company, work
agree that employer branding has an important role balance, and job security.
in increasing organizational competition through H3: There is a positive and significant relationship
employer branding. between the perceptions of talented employ-
ees of corporate reputation towards the inten-
RESEARCH FRAMEWORK AND HYPOTH- tion to apply for a job.
ESIS
According toWallace, et al. (2013), leadership
The dimensions of the working environment are
in an organization will determine the commitment
relevant in the discussion of employer branding, see
of its workers. In other words, a leader is key to
Table 1. Swider, et al., (2015),revealed the impor-
running an organization effectively(Biswas & Suar,
tance of working environment factors as a major
2016). In the midst of competitive organizations to-
factor in accepting job offers. Boamahand
day. It will be easier to lose employees because of-
Laschinger(2016), also emphasized the importance
fers are better from elsewhere. Thus, it is not just
of the working environment as an instrument to re-
about job security and compensation that is impor-
tain employees and also encourage employee in-
tant but also career potential and self-development.
volvement in the organization. Thus,the hypothesis
H4: There is a positive and significant relationship
is:
between the perception of talented employees
H1: There is a positive and significant relationship
of corporate vision and leadership towards the
between the perceptions of talentedlocal em-
intention to apply for a job.
ployees regardingthe working environment to-
wards the intention to apply for a job.

120 JOURNAL OF APPLIED MANAGEMENT VOLUME 17 NUMBER 1 MARCH 2019

 The Dimension of Employer Branding: Attracting Talented Employees

Perceptions of Work H1
Environment(CWE)

Perceptions of Compensation H2
and Benefits (CCB)

Perception of Corporate Intentiontoapply for a job

H3
Reputation(CCR) (ITA)

Perception of Corporate Vision

H4
&Leadership(CVL)

Perception of Corporate Social &

Responsibility (CSR) H5

Figure 1 Research Framework and Hypothesis

Jones, et al. (2017),shows that there is a link ees, who are students in Jakarta and Tangerang,
between CSR companies’CSR programs and strong Indonesia. This research is aimed more t at stu-
employer branding. CSR in practice can change the dents majoring in management and accounting be-
company’s image and become a measure of for cause these students are more likely to have a ca-
employees and talented employees in their career reer in managerial positions. The surveysucceededin
choices. The better the CSR owned by the compa- collecting 277 respondents based onpredetermined
nies, the better it will further increase the desire of goals. The statements given by the respondents
talented employees towards the company as their weremeasured using a Likert scale from 1 “Strongly
career choice in the future. Disagree” to 5 “Strongly Agree” because the Lickert
H5:There is a positive and significant relationship scale has better quality results than other scales
between the perception of talented employees (Revilla, et al., 2013).The data analysis used Struc-
of corporate social and environmental respon- tural Equation Model (SEM) to show the relation-
sibility towards the intention to apply for a job. ship between variables with AMOS software ver-
sion 24.
METHOD
Direct surveys are conducted using a purpo-
sive sampling approach for talentedlocal employ-

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 Florentina Cindy Finishtya

Table 3 Research Instrument

Code Observed Variable References

CWE_2 My working environment should encourage employee creativityA dynamic work- (Hur, 2012)
CWE_3 ing environment will be my choice as a place to work

CCB_3 Compensation in the form of health and life insurance is my priority (Hur, 2012)
CCB_4 Retirement benefits are a factor to be considered
CCB_5 Further study is a consideration I choose if offered in the workplace

CCR_2 Reputable companies attract me more in career development Alnýaçýk, et al.,

CCR_3 Prestigious companies attract me more as an ideal workplace 2014) and
CCR_4 A well-respected company is my reason for my future career (Hur, 2012)

CVL_2 Corporate culture is my consideration for my future career Alnýaçýk, et al.,

CVL_3 High ethical standards at a workplace attract me more 2014) and
CVL_4 Strong leadership is the reason for choosing a workplace (Hur, 2012)

CSR_1 Environment friendly products are my consideration in starting my career Alnýaçýk, et al.,
CSR_2 Companies that focus on the environment isthe reason I want to submit my job 2014) and
application (Hur, 2012)
CSR_3 Companies that are active in the community will give more value

ITA_1 I want to work for the company that I desire immediately Alnýaçýk, et al.,
ITA_3 I am willing to accept whatever benefits offered from the company that I desire 2014)
ITA_4 I will be serious and willing to work for the company that I desire

RESULTS respondents in accounting majors with a ratio of

Respondents’ Profile 70.76 percent compared to 29.24 percent. Finally,
based on the study period student respondents domi-
The profile of respondents from the survey
nated morethan the final level student as respon-
shows that the sex ratio is quite balanced with 46.7
dents with a ratio of 66.06 percent compared to
percent of male respondents and the rest are women
33.94 percent. Profiles with GPA>3.00 dominated
with 53.43 percent, as explained in Table 4. Based
the survey with 65.53 percent and followed by
on the educational background perspective, respon-
GPA<2.99 with 34.47 percent.
dents in management majors dominated morethan

Table 4 Profile of Respondents

Frequency Percentage (%)

Gender Male 129 46.57
Female 148 53.43
Major Accounting 81 29.24
Management 196 70.76
GPAScale out of 4 < 2,49 15 5.41
2,50 < x < 2,99 82 29.60
> 3,00 181 65.53

122 JOURNAL OF APPLIED MANAGEMENT VOLUME 17 NUMBER 1 MARCH 2019

 The Dimension of Employer Branding: Attracting Talented Employees

Validity and Reliability as 2 variables (WE_1 and WE_4), CCB as many

According to Peterson and Kim (2013), to as 2 variables (CB_1 and CB_2), CCR as many as
achieve valid and reliable datamust meet specific 2 variables (CR_1 and CR_5), CCV as many as 2
parameters. Data validity must meet AVE > 0.5 variables (CV_1 and CV_5), CS as many as 1 vari-
while reliability CR > 0.6. All data is in accordance able (CS_4) and ITA as many as 2 variables (ITA_2
withtherequirements. To fulfil these requirements, and ITA_5). Details are shown in Table 5 and Fig-
researchers eliminate some of the observed vari- ure 2.
ables. We reduce several variables, CWE as many

Figure 2 Structural Equation Modeling Output Analysis

Table 5 Validity and Reliability Result

ITA CWE CCB CCR CCV CCS Standard Value

C.R 0.715 0.611 0.699 0.898 0.723 0.820 C.R > 0.6AVE > 0.5
AVE 0.553 0.545 0.543 0.695 0.561 0.662
Source: Research Analysis (2018)

Goodness-of-fit gets, CFI, TLI, and GFI. The targetsrefer to the

Overall, the result has met the standardization range of indicator values 0 to 1, where 0 indicates
of the model feasibility index, see Table 6. Almost poor fit and 1 indicates the perfect fit (Hair, et al.,
all capable values are as required. Some indicators 2014). Thus, CFI, TLI, and GFI, then these results
have difficulty meeting the required indicator tar- should be categorized as feasible.

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 Florentina Cindy Finishtya

Table 6 Goodness-of-Fit Results

Indicator Match Level Target Estimation Result References Fit Measurement

CMIN/DF  2-5 X2/df = 3.326 (Hair, et al., 2014) Best Fit
CFI  .90 .833 Fit
TLI  .90 .801 Fit
RMSEA  .08 .092 Best Fit
GFI  .90 .859 Fit
Source: Research Analysis (2018)

Hypothesis Testing namely (P <0.001 to P <0.01), H1 with a value of P

The analysis found that the five-variable rela- with 0.004, H3 and H4 with 0,000. Whereas H2
tionship on employer branding did not all have a and H5 cannot be accepted (rejected) because it
positive and significant relationship, see Table 7. H1, was unable to fulfil the required value, H2 = 0.446
H3, and H4 are acceptable hypotheses because they and H5= 0.276.
have P-values that meet the required indicators,

Table 7 Hypothesis Testing Results

Hypothesis Path Relationship Estimate (S) C.R. P Decision

H1 CWE  0,153 3,238 0,001 S***
H2 CCB  0,058 0,730 0,446 NS
H3 CCR  ITA 0,319 4,120 *** S***
H4 CCV  0,363 3,824 *** S***
H5 CCS  0,086 1,089 0,276 NS
(S) Supported; (NS) Not Supported; *significant at 0,05; **at 0,01; *** at 0,001
Source: Research Analysis (2018)

Corporate visionand leadership have the big- interests of local talent employees, theseelements
gest influence due to the largest coefficient value may still be a concern for the company.
as compared to other dimensions of employer brand-
ing with a coefficient value of 0.363. The next posi- DISCUSSION
tion was followed by corporate reputation with This research proves that employer branding
0.319and working environment with 0.153. These has positive implications for the intention oftalented
results indicatethat in maintaining the competitive- local employees to applytothe organization. Other
ness of companies in recruiting talented employees findings show that ofthe five dimensions of employer
through employee branding, companies can priori- branding, only three affects significantly, corporate
tize corporatevision followed by other dimensions vision and leadership, corporate reputation and
of employer branding. While the elements of com- working environment. The research findings corrobo-
pensation and benefit and corporate social respon- rate several previous studies (Wallace, et al., 2013,
sibility, do not have a significant influence on the Biswas and Suar, 2016, andSwider, et al., 2015).

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 The Dimension of Employer Branding: Attracting Talented Employees

Corporate vision and leadership can attract considered by talentedemployees. The priorities of
every member of the organization to move forward the organizationwhich are corporate vision and lead-
and provide information in running the organization ership, corporate reputation, and the working envi-
and also in maintaining the sustainability of the com- ronment respectively must be considered in the cre-
pany. For talented employees, corporate vision and ation of employer branding. On the other hand, com-
leadership are considered important because they pensation benefit and CSR are the dimensions of
can attract them to work better, not only in terms of employer branding that do not attractthe interest of
position but also self-development. Corporate repu- talentedemployeesto jointheir desired organization.
tation is the behaviour of the company in carrying
out its activities. Companies with the best corpo- Recommendations
rate reputation will be more attractive for talented This research has limitations, and the results
employees to want to join the organization. The should not accept fully at face value. In the sam-
working environment also hasan important role be- pling, there should have been a more equitable dis-
cause itmaintains organization continuity and em- tribution sample in several major cities in Indonesia,
ployee retention. Low employee turnover is a form cities that have the potential to absorb qualified, tal-
of organization success (Boamah & Laschinger, ented employees. Furthermore, as the scope of the
2016). From the perspective of talented local em- study is very limited, the findings of this study need
ployees, Boamah and Laschinger argue that the low to be examined further.
turnover rate is evidence that the organization can From this study, one employer’s branding di-
maintain their assets properly. mension related to compensation and benefits was
Compensation benefits are no longer themain found to be no longer the main consideration with
consideration of talented employees to join the or- regards to the intention of talented employees to
ganization. This finding wascontrary to the study join a company or organisation. This contradicts
conducted by Gilaniand Cunningham (2017). This previous research that encourages improvement of
point of viewemphasizes that talented employees the compensation and benefits dimensionto attract
need more long-term relationships in an organiza- talented local employees.
tion. For them, compensation benefits obtained are
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