influences of organizational image on applicant attraction in the recruitment process in indian...

ITM BUSINESS SCHOOL, KHARGHAR, NAVI MUMBAI

Influences of Organizational Image on Applicant Attraction in The Recruitment Process in

Indian Companies A Research Methodology Project

2/25/2015

Prasad B Shirke (Roll no 01) Mayur S Nanotkar (Roll no 03)

PGDM – Information Technology (2014-16)

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Influences of Organizational Image on Applicant Attraction in The Recruitment Process in Indian Companies

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Table of Contents INTRODUCTION ............................................................................................................................................. 2

EMPLOYER BRANDING .............................................................................................................................. 2

LITERATURE REVIEW ................................................................................................................................. 3

RESEARCH OBJECTIVE ....................................................................................................................... 4

EMPLOYEE VALUE PROPOSITION (EVP) ......................................................................................... 4

RESEARCH METHODOLOGY .......................................................................................................................... 5

METHOD OF DATA COLLECTION ............................................................................................................... 5

SAMPLE SIZE .............................................................................................................................................. 5

DATA ANALYSIS TECHNIQUES ................................................................................................................... 6

DATA ALLOCATION, ANALYSIS AND INTERPRETATION ................................................................................. 7

RESEARCH HYPOTHESIS ............................................................................................................................ 7

RESEARCH FINDINGS ................................................................................................................................. 7

HYPOTHESIS TESTING ................................................................................................................................ 9

CORRELATION ANALYSIS ....................................................................................................................... 9

REGRESSION ANALYSIS ....................................................................................................................... 10

RECOMMENDATIONS & CONCLUSION ....................................................................................................... 12

LIMITATIONS ........................................................................................................................................... 12

REFERENCES ................................................................................................................................................ 13

TABLE 1: DEMOGRAPHIC PROFILE OF THE RESPONDENTS ............................................................................................................ 7

TABLE 2: DESCRIPTIVE STATISTICS ................................................................................................................................. 8

TABLE 3: CORRELATIONS ANALYSIS ..................................................................................................................... 9

TABLE 4: MODEL SUMMARY .......................................................................................................................................... 10

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INTRODUCTION The modern business environment is marked with challenges of intense global

competition, rapid technological changes, growth of the knowledge economy, and a growing

need for talented employees. These significant changes have stimulated organizations to devote

considerably more resources to the activities oriented towards attracting qualified individuals. At

organizational level companies are putting more emphasis on creating strategies to differentiate

themselves from competitors. One of the most popular recruitment strategies adopted by many

companies nowadays is Employer Branding. Employer brand as a strategic HR tool helps

organizations to focus on how they can identify themselves within their markets as an employer

of current staff, as a potential employer to new recruits and as a supplier or partner to customers.

Employer branding may be a new terminology for many companies, yet it is becoming more and

more important to organizations since maintaining and building a strong internal and external

brand is an important factor in retaining loyalty, motivation and driving performance.

EMPLOYER BRANDING The concept of “Employer Branding” has been first coined by Ambler and Barrow

(1996), the authors described employer brand as the ―package of functional, economic, and

psychological benefits provided by employment, and identified with the employing company.

Employer branding, therefore, is understood as the set of distinctive images of a prospective

employer, which is manifest in the minds of the target people – potential employees (Meffert,

Barmann, &Koers, 2002; Petkovic, 2004). It has also been recognized that as strong consumer

brands influence growth and bring profits to companies, the same way strong employer brand

has an influence on business outcomes (Sasser&Arbeit, 1976).1

In fact a strong corporate brand umbrella, hosting the employer brand as well as the

customer brand is beneficial to the organization. To create a unified as well as truthful brand

image, this brand needs to represent the current company culture. While the customer brand and

employer brand compete in two different markets - one for products and services; the other for

talent and commitment - they are closely interrelated. The employer brand, in attracting the right

employees and maintaining their commitment to high performance, plays a critical role in

building and supporting the customer brand. Likewise, the strength of the customer brand plays

an important role in attracting the right people to come and work for the company. When a firm

reaches a higher level of external recognition by developing an employer brand, it becomes

much easier for it to attract new talent (Bouchikhi and Kimberly, 2008). Thus employer branding

can be regarded as an application of branding principles to human resource management. It is an

interesting concept because it incorporates the two organizational fields: Branding and Human

Resources.

The combination provides a holistic view on attracting and retaining organizational

appropriate employees. In fact branding in the field of Human Resource Management (HRM)

has recently received a lot of attention and is generally explained as improving the image of an

employer (Backhaus &Tikoo, 2004). The employer brand philosophy is generally concerned

with building a distinctive image in the minds of recruits and existing employees that a company,

above all others, is a "great place to work" (Ewing, Pitt, Debussy, &Berthorn, 2002). Employer

brand represents a unique value proposition about what individuals might receive as a result of

1 (Sharma, 2014)

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working for a particular employer. This proposition, if delivered as promised, also contributes to

a firm's positive reputation as a workplace and could become an effective tool for recruitment,

employee engagement and retention (Barrow and Mosley, 2005). In fact Employer brand is best

viewed as consisting of two elements: the "value proposition" about what people might receive

as a result of working for a particular employer, and the "employee experience" which represents

the reality of the delivery of the deal (Rosethorn, 2009). Rosethorn view on employer branding

has reflected that how the employee value proposition affects the formation of the psychological

contract between employee and employer with the potential of affecting retention and

engagement of employees in the long-term perspective after actual employment. Therefore in the

present research study an attempt has been made to understand how the employee value

proposition is constructed since it offers an opportunity to capture the impact or benefits of the

“written and unwritten” aspects of the psychological contract.2

LITERATURE REVIEW The notion of employer branding rose quite recently in the sphere of human capital

management. It emerged from applying marketing principles to the field of people management

(Lievens et al., 2007). Ambler and Barrow (1996) first coined the term ‘employer branding’.

This definition appears to be analogous with the three brand concepts highlighted in the brand

literature: functional, symbolic and experiential (Ramaseshan and Tsao, 2007). Lloyd (2002)

defines the employer brand as the image of the firm as “a desirable place to work” in the mind of

existing and prospective staff. As Backhaus and Tikoo (2004) note, employer branding is

employment specific and represents organizations’ efforts to communicate to internal and

external audiences what makes it both desirable and different as an employer.

To study the various perspective of the Employer Brand Image the following papers were

referred with a view to get the major factors that affect the applicants’ perspective towards the

Employer Image:

1. Influences of Employer Brand Image on Applicant Attraction in Recruitment Process by

Ridhi Sharma. (Sharma, 2014)

2. Employer Branding and its Influence on Potential Job Applicants by Lin Dar Ong. (Ong,

2011)

3. Measuring and Managing Employer Brand Image in the Service Industry by Simon Knox

and Cheryl Freeman. (Freeman, 2006)

4. Managing Your Brand Throughout The Recruitment Process by Robert Walters.

(Walters)

5. The Features Of HRD In Companies With The Employer Brand by Dmitry Kucherov and

Elena Zavyalova. (Zavyalova)

6. Which Employees’ Values Matter Most in the Creation of Employer Branding? By

Mukesh Biswas and Damodar Suar. (Suar)

7. The role of Employer branding and Talent Management for Organizational Attractiveness

by Babar Yaqub and Dr. Muhammad Aslam Khan. (Khan)3

2 (Sharma, 2014)

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Subsequently, three major categories were finalized to research upon viz, Social, Economic and

Functional.

a. Social defining the Work Culture at the Organization;

b. Economic factor defines the salaries and on-site opportunities and

c. Functional factor defines the Work ethics followed by the Employer.

RESEARCH OBJECTIVE

Although a lot of research is being carried out in Employer Branding lately, few studies

have paid little attention to the specific components that determine employees’ values and their

effect on Employer Branding as a whole. Therefore, this is study focused on the attraction of the

potential employees towards the Employer Organization. In this study, potential employees

represent both current and prospective, ranging from talent pool to campuses, and employees

within the company. Given the key role of the value audit step, it should incorporate important

stakeholder beliefs about the characteristics of a branded employer. Hence, the objective of this

study is to examine the relative importance of different aspects of Employer Image or Brand

addressing values of different groups of individuals ranging from the talent pool of prospective

employees and current employees. Briefly, the objective is to examine the effect of employers’

values on the Applicant Attraction.

EMPLOYEE VALUE PROPOSITION (EVP)

Creating an employee value proposition (EVP) is crucial in developing a company’s

employer brand. The EVP is unique and is informed by five main elements, namely: work

environment and affiliation (this includes values, culture, and quality of colleagues, managers

and leaders), work content includes challenging work and work–life balance, benefits including

development and career growth (indirect financial reward), and remuneration. A differentiated

Employer Value Proposition (EVP) adds impetus to the employer brand and is a valuable tool for

attracting candidates. Therefore a closely related concept to ‘employer branding’ is ‘employer

attractiveness’. Berthon, Ewing and Hah (2005) define employer attractiveness as “The

envisioned benefits that a potential employee sees in working for a specific organization”.

Employer attractiveness and EVP are strongly interrelated. To become an attractive employer in

the eyes of a specific group, an organization needs to create an EVP that is appealing and

captivating according to that group’s expectations. If the EVP has been created effectively, it will

act as a tool for attracting the right candidates within that specific group.

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RESEARCH METHODOLOGY Within this framework the study explored the underlying structure of employer brand by

identifying its dimensions from the perspective of potential applicants. Participants of the study

were 50 in numbers ranging from potential graduates, Final year students, Fresher’s and the

Current employees of any Organization. The main objective of the study is to identify various

factors associated with employer branding. The study investigated various factors that are related

to prospective applicant’s impressions of an organization’s image as an employer and how these

perceptions about employer’s image attract prospective applicants to apply for the job.

METHOD OF DATA COLLECTION Perceptions of organizational image were measured by using 14 item scales consisting of

5 items assessing perception of functional or Work Ethics at the organization, 5 items assessing

perception of Social factors or the Work Culture at the organization, while 4 items assessed

perception of Compensation or Economic Factors. The respondents were supplied with the 2

page Google form (http://goo.gl/forms/1okg7T6wwg) as a questionnaire.

SAMPLE SIZE There were 50 respondents out of which the gender and age wise breakup is represented

in the figure1 and 2 respectively. The age group was divided as:

18-22 (24%), 23-26(44%), 26-30(22%) and >30(10%). Out of total respondents 17(34%) were

females against 33(66%) males.

The respondents were also asked whether they are an existing employee or a fresher just joined

an Organization, not a final year student of graduation or in final year of graduation. The breakup

of the respondents is shown in figure 3. Out of the total respondents, 15(30%) were not in their

FIGURE 2: AGE WISE DISTRIBUTION OF THE RESPONDENTS FIGURE 1: GENDER WISE DISTRIBUTION

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final year, 8(16%) were in Final Year of their graduation, 10(20%) were Fresher’s and 17(34%)

were experienced professionals.

DATA ANALYSIS TECHNIQUES The data has been statistically analyzed by using analyzed statistically by using

percentages, mean, standard deviation, inter-correlation and regression. These statistical

techniques form the basis of any Research Work. These techniques are easy to interpret and all

other complex techniques are based on them. The IBM SPSS Statistics 20 tool was used for all

the analysis.

FIGURE 3: DISTRIBUTION OF THE RESPONDENTS - QUALIFICATION

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DATA ALLOCATION, ANALYSIS AND INTERPRETATION

RESEARCH HYPOTHESIS

The following hypothesis were formed and later tested:

1. Positive perceptions of organization’s image will be positively related to applicant’s

attraction to apply for the Job.

2. Positive perceptions about the work ethics followed by the employer will be positively

related to applicant’s attraction to apply for the job.

3. There exists a positive relationship between the compensation/Add-ons offered by the

organization and applicant’s attraction to apply for the job.

4. Positive perceptions of organization’s work culture will be positively related to

applicant’s attraction.

RESEARCH FINDINGS Table 1 shows the demographic profiles of the respondents. It has been observed that

TABLE 1: DEMOGRAPHIC PROFILE OF THE RESPONDENTS

Qualification Percentage

A Student (Not in Final Year of Studies) A FInal Year Student A Fresher working for an Organization Experienced Professional

30% 16% 20% 34%

Gender

Male Female

66% 34%

Work Experience

Less than 1 year (0-1) 1-3 years More than 3 years

26% 37% 37%

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TABLE 2: DESCRIPTIVE STATISTICS

N Minimum Maximum Mean Std. Deviation

Overall Applicant Attraction

on a scale of 30 50 8 24 18.48 3.581

Importance to WorkEthics

on a scale of 11 50 3 11 7.30 1.982

Importance to

AddOns/Perks on a scale of

10

50 2 8 5.44 1.580

Importance to Culture on a

scale of 09 50 3 8 5.74 1.440

Valid N (listwise) 50

Also the descriptive Statistics for all variables including mean and standard deviation are

shown in Table2. Participant attraction to apply for job is at higher side (mean = 18.48). With

respect to Organizational image, the perception of the participants about the Work Ethics (mean

= 7.30) and organizations’ Work Culture (mean = 5.74) is at positive side and also the participant

scored high (mean = 5.44) on Economic/Add-ons/compensation provided by the Organizations

offering jobs to prospective candidates.

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HYPOTHESIS TESTING

CORRELATION ANALYSIS

Correlation and regression analysis were conducted to test the hypothesis. The results are

indicated in Table 3.

TABLE 3: CORRELATIONS ANALYSIS

Overall Applicant

Attraction on a scale

of 30

Importance to

WorkEthics on a

scale of 11

Importance to

AddOns/Perks on a

scale of 10

Importance

to Culture

on a scale

of 09

Overall Applicant Attraction

on a scale of 30

Pearson

Correlatio

n

1 .836** .611

** .666

**

Sig. (2-

tailed)

.000 .000 .000

N 50 50 50 50

Importance to WorkEthics on

a scale of 11

Pearson

Correlatio

n

.836** 1 .257 .421

**

Sig. (2-

tailed) .000

.072 .002

N 50 50 50 50

Importance to AddOns/Perks

on a scale of 10

Pearson

Correlatio

n

.611** .257 1 .069

Sig. (2-

tailed) .000 .072

.633

N 50 50 50 50


scale of 09

Pearson

Correlatio

n

.666** .421

** .069 1

Sig. (2-

tailed) .000 .002 .633

N 50 50 50 50

**. Correlation is significant at the 0.01 level (2-tailed).

The results of the correlation analysis suggested that the positive perception towards the

Work Ethics observed by the organization is significantly correlated with the applicant’s

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attraction towards the organization (r = .836**, p <0.05). These results indicated that the

organizations that offer challenging work, opportunities to use abilities, opportunity to learn and

rapid advancement and freedom to employees have a good potential to attract the prospective

candidates. Therefore hypothesis H1a is accepted.

It has also been observed that the positive perception towards the Work Culture also

significantly attracts the prospective candidates (r = .666**, p <0.05). It has been observed that

work culture of the organization perceived as possessing favorable attributes were more likely to

attract individual to consider that organization for potential employment. Hence hypothesis H1c

is accepted.

Further a good compensation package or an on-site opportunity offered by the employing

organization significantly attracts the prospective candidates (r = .611**, p <0.05). All these

results are consistent with the findings of Gaddam (2008) who opined that a strong employer

brand aims to influence every touch point of the employment experience by promoting a

beneficial employment package in form of pay and benefits, working environment, career

management, balanced work life, mental and social satisfaction etc. Therefore hypothesis H1b is

also accepted.

The results of correlation analysis indicated that the positive perceptions of

organization’s image have been significantly correlated to applicant’s attraction to apply for the

job. Hence Hypothesis H1 is accepted.

REGRESSION ANALYSIS

To further validate the statistical result from correlation, regression analysis is conducted. The

variables applicants’ attraction (Importance to Culture), positive perception about Work Ethics (,

Importance to Work Ethics) and positive perception towards the Add-ons/compensation offered

(Importance to Add-Ons) were regressed with applicants’ attraction (Overall) to determine their

significance. The Model summary is given in Table 4 and the regression coefficients are given in

Table 4 (a).

TABLE 4: MODEL SUMMARY

Model R R Square Adjusted R Square Std. Error of the Estimate

1 .487a .237 .213 .27981

a. Predictors: (Constant), Importance to Culture on a scale of 09, Importance to AddOns/Perks on a scale of 10, Importance to WorkEthics on a scale of 11

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Table 4(a): COEFFICIENTS

Coefficientsa

Model Unstandardized Coefficients Standardized

Coefficients

t Sig.

B Std. Error Beta

1

(Constant) 1.701 .409 4.156 .000

Importance to WorkEthics

on a scale of 11 .186 .077 .217 2.423 .017

Importance to

AddOns/Perks on a scale of

10

.137 .061 .209 2.256 .026


scale of 09 .245 .074 .306 3.298 .001

a. Dependent Variable: Overall Applicant Attraction on a scale of 30

From the results of regression analyses It has observed that the multiple R between the

predicted variable (Importance to WorkEthics, Importance to AddOns/Perks and Importance to

Culture) and dependent variable (Overall Applicant Attraction) is .48, the square of multiple R

(R2) is .23, and this indicates that all three predictors collectively account for 23% of the total

variance in applicants’ attraction. The regression equation can be stated as:

Overall Applicant Attraction = 1.70 + .18(Importance to WorkEthics) + .13(Importance to

AddOns) + .24(Importance to Culture)

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RECOMMENDATIONS & CONCLUSION

The findings of the present study indicated that positive impressions about the employer

organization significantly influence the decision of employees to join the organization. A strong

employer brand helps the organization to compete effectively in the market and drive employee

loyalty through effective recruitment, engagement and retention practices. When a firm reaches a

higher level of external recognition by developing an employer brand, it becomes much easier

for it to attract new talent.

The aim of employer branding is to become an ‘employer of choice’, a place where

people prefer to work. This means developing ‘a value proposition’, which communicates what

the Organization can offer its employees as a ‘great place of work’. (Sharma, 2014). The factors

that contribute to being an employer of choice are the provision of a reasonable degree of

security; enhanced future employability because of the reputation of the organization as one that

employs and develops high quality people, as well as the learning opportunities it provides;

employment conditions that satisfy work- life balance needs; a reward system that recognizes

and values contributions; provides competitive pay and benefits; interesting and rewarding work;

and opportunities for learning, development and career progression. Therefore organizations

have to make extra efforts to maintain their image before the prospective applicants as an

attractive employer.

In fact to obtain positive results, employer branding must be in line with the corporate

brand of the company. A misalignment between the employer and the corporate brand can cause

confusion with employees, shareholders and customers. Also since the present study has been

conducted in India where employer branding is still an emerging concept, the considerable

challenge for the HR managers in India is to build the brand of an Indian MNC overseas, and as

the HR would now have to create a value proposition that the firm can offer overseas that is in

synchronization with its values and communication within its home country, while keeping the

culture and tradition of the foreign country in mind as well.

LIMITATIONS The study has several limitations. First, email survey method was used to conduct the

study which is not the most reliable and accurate one always. It was used since it is the most

feasible method available. Future research should use personal interviews because they are more

likely to produce more accurate and reliable responses; and a nation-wide sample would ensure a

more representative sample, which includes all types of organizations.

Second, employees of not many organizations were examined here, and one should be

cautious about generalizing the results to other sectors.

Third, the study was performed in one region with unique culture, and its findings might

be pertinent only to this particular culture. Therefore, this study must be replicated numerous

times in different regions or cultures before firm conclusions can be made.

Despite these limitations, the findings of this study demonstrate the importance of

employees’ values on employer branding.

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REFERENCES Freeman, S. K. (2006). Measuring and Managing Employer Brand Image in the service Industry . Journal

of Marketing Management, 2006, 22, 695-716.

Khan, B. Y. (n.d.). The role of Employer branding and Talent Management for Organizational

Attractiveness. Far East Research Centre.

Ong, L. D. (2011). Employer Branding and its Influence on Potential Job Applicants. Australian Journal of

Basic and Applied Sciences, 5(9): 1088-1092, 2011.

Sharma, R. (2014). Influences of Employer Brand Image on Applicant Attraction in Recruitment Process.

International Conference on Management and Information Systems.

Suar, M. B. (n.d.). Which Employees’ Values Matter Most in the Creation of Employer Branding? Journal

of Marketing Development and Competitiveness vol. 7(1) 2013.

Walters, R. (n.d.). MANAGING YOUR BRAND THROUGHOUT. White Paper.

Zavyalova, D. K. (n.d.). The features of HRD in companies with the employer brand.

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influences of organizational image on applicant attraction in the recruitment process in indian...

Business

research hypothesis

research objective

research findings

research methodology

data analysis techniques

correlation analysis

regression analysis

recruitment process