Have you ever dated someone who you thought was a great catch, and then all of your friends and family members told you that they didn't like him or her? Even if you thought this person was the one, you started to have doubts and reservations about them. The same is true in the business world. If you start working for an organization that you believe to be a good fit and then hear about how much people don't like the company, you will start having doubts. This doesn't necessarily mean you will quit the company, but your overall employee experience will be affected negatively.
I'm sure you can think of several examples of organizations that have treated animals cruelly, represented unethical business practices, harmed employees or the environment, or treated customers unfairly. Keep in mind that this isn't just about employees viewing the company positively, but the public as well. We live in a very open and transparent world, so when an organization does something wrong or unethical, people tend to find out. Similarly, when an origination is admired and revered, people wanted to work there. The most recent Fortune list of the world's most admired companies includes Apple, Amazon, Disney, Starbucks, and Southwest Airlines, which shouldn't be a surprise to anyone because these companies have such great reputations.
Sometimes organizations aren't viewed positively because they are simply engaging in poor business practices, but other times organizations don't do a good enough job of letting the world know what they stand for, why they do what they do, and what it's like to work there. In either case the situation needs to be corrected.
Glassdoor is a website that provides an amazing amount of transparency into nearly any organization. You can see the overall company rating on a five-star scale, the CEO approval rating, salary information, candid reviews of the organizations, pictures of the offices, the benefits, interview process, and much more for nearly any company in the world. The amazing thing is that information is put up on the website by employees! If you're looking to work for an organization, you basically have the information you need to decide whether this is a place you want to work before even submitting a resume.
I used to think that lists that highlight the best or greatest companies to work for had no real business merit. However, they actually have an impact on the overall brand perception of the organization and on the overall employee experience. Employees feel a greater sense of pride when they work for one of these awarded organizations, and it also appears that they stay there longer. What's interesting about these lists and awards is that some of them are quite hard to get onto and require significant financial and people resources. In other words, to get the award or make the list, you genuinely have to make some changes in your organization, which is a good thing. There are many of these lists and awards, including most admired companies, most sustainable, best places to work, happiest places to work, greenest companies, and so on.
Today, this company perception often falls under something called employer branding. HR is responsible for all the people inside of the organization, and marketing is responsible for driving awareness of products, services, and the organization as a whole. It's not hard to see why these two roles need to come together to focus on the overall company perception. In fact, almost 50% of HR professionals contribute to employer branding with marketing.
Company perception can have a tremendous impact on the business. A study by LinkedIn found the following:
• The cost of a bad reputation for a company with 10,000 employees could be as much as $7.6 million in additional wages.
• Employers who fail to invest in their reputation could be paying up to an additional $4,723 per employee hired.
• Nearly half of U.S. professionals would entirely rule out taking a job with a company that exhibited negative employer brand factors, no matter what pay raise they were offered. Even a pay raise of 10% would only tempt 28% of use to sign on the dotted line.
• Companies with all five positive employer qualities--job security, professional development opportunities, opportunity to work on a better team, the same values as the employee, and an organization that is talked about positively--can win over nearly half of those aged 18-34 with no pay increase.
This doesn't mean your goal should be simply to make every list that's out there. That would be nice, but it's far more important to understand what the organization wants to be known for and how it can effectively tell the story and build the employer brand around it. Look on websites like Glassdoor to see how your company is perceived and keep a pulse on the conversations happening about your organization. Making sure your organization is viewed positively can keep employees happy and proud to be associated with your brand. You can learn more in my latest book here.