A tool to measure & increase employee value


Branding is the management of meaning. That meaning exists in the hearts and minds of your customers… AND your staff. Your employees will have a huge impact on creating and enhancing your customer experience and thus the meaning the customer places on your brand. Therefore any serious branding initiative needs to touch on creating employees who understand the brand and can create positive, brand-aligned, customer experiences.


Image by: dylan nolte - Source: unsplash


Ensuring you design an employee journey which helps to connect and motivate employees around 'brand thinking' is therefore crucial.


Businesses can fail or succeed on the quality of their internal processes, recruitment and culture. Getting the right people, developing them, creating an environment where they are happy and also a culture based on brand principles, will ensure you get to pick from a talent pool that wants to work for you and retain the brilliant talent you have already obtained.


But how can you get to grips with this? Wouldn't it be nice to have a simple but powerful tool to use to improve your processes, track your progress, benchmark and consider the return on your recruitment investments?


Those of you that read my content regularly will know how I love a good diagram. Everything is easier with a visual. In this post, I want to introduce you to one such helpful illustration which you can use as a tool to make massive gains in your employee experience. Here it is, it's called 'The Employee Lifetime Value' model:



The Employee LifeTime Value graph


The above graph is a typical representation of an employee's lifetime value (ELTV). The employees “value” is represented on one axis and their “time” in the business on the other. The plotted graph then represents the value of the employee overtime to the organisation. Usually, the value of the employee is set to increase over time, decreasing only when they decide to leave the business.


On most ELTV graphs employees start with a negative value. Usually, they are costing the business from the time they are offered the job until they are on-boarded and trained. As time goes on their experience in the job makes them even more valuable until they become disengaged and one day they decide to leave. At this stage their contributions to the value of the business declines.



3 Steps for you to effectively use The Employee Lifetime Value Model

So how could you use this as a tool for your business? Here are 3 steps to using this as a tool to improve employee value. As is typical we will be using design thinking to systemise and create something which can scale.



Step 1. Make it yours

The first thing to do is consider mapping out your employee journey. Use the above as a template but consider activities and steps that your business does.


As you do this, ask your leadership team - how different are these activities in our category? How many are aligned with our brand strategy? How can we create unique experiences which help to bring brand awareness amongst our people and that delight and encourage them? How are we prooving to them we don't just "talk the talk" but we really do, "walk the walk"?



Step 2. Adding data points

If you can’t measure it you can’t improve it. Consider each stage. How can you track if an activity is working?


Of course, you can use this model from a purely financial perspective, pulling in raw financial data from the recruitment process and other areas of the business and estimating value based on the employee's contribution to sales or customer satisfaction for example. Finance people love this kind of thing because they can build a financial model.


However, as a brand and culture specialist, I look at this graph differently and would suggest you can add other metrics. How can we make improvements and use it to track employee satisfaction? Could we add useful elements in the employee journey to help us to track how our processes our perceived? For example, do we need to put in an automated email after 1 month, 3 months, 6 months and 12 months and get a score from staff of their satisfaction level - or ask managers, customers and peers within their team for there perceived value of the employee?


How could you create great experiences and track if an employee was becoming an ambassador of these experiences and your brand? How much value could that add to your business?


However, you add data into your specific model, ensure there is a fair automated and designed system and that you get regular reports so you can benchmark your progress.



Step 3. Use as a development tool

Now you have a system in place which you are tracking the next step is to use it to test ideas to make improvements. For example, could you introduce a new initiative in the onboarding process which will speed up the time it takes to make the employee of high value to the business? What would it be? Try it and check the results. Has this new idea really made a difference?


Ideally, you'd be looking to shift your graph over time to something like the below:


In the graph above the green line indicates a positive shift. Recruitment is shorter and cheaper. Onboarding is quicker and creates more value. Development it better and so the skills and value of the employee are higher. The employee stays longer and so churn rate is decreased which in turn improves your reputation with customers and future potential recruits etc.


The key questions to consider when considering improvements are:

  • If we had a better employer brand (e.g. we were more attractive to the people we were trying to recruit) how would this reduce our paid recruitment fees?

  • If we recruited people based on our brand purpose, (people that believed what we believed and were emotionally bought into our brand's reason to exist), would that mean they were more engaged, on-boarded quicker and more willing to develop valuable skills for us?

  • If we invested in a better-designed onboarding experience would this get people up to speed quicker?

  • If we had better management training programs would that mean our staff were more likely to perform better, trust us more and stay longer?

  • If we focused on building an amazing culture (e.g. by looking at our brand and then designing routines, rewards, reminders - unique experiences - around what we value and the behaviours we want to champion) then would that mean people would be happier and stay longer?


These are just some of the big questions this tool can begin to help you answer.


So - I wish you all the best in setting up your own ELTV model and using it to make improvements to your employee experience. Because your employee experience will affect your customer experience. And your brand exists in the hearts and minds of your customer.

0 views
Let's connect
LevelC_Certified2.png
JustBrandingPodcast.jpg
0
  • linkedin
  • twitter
  • Black Instagram Icon

Matt Davies Consultancy Ltd.
Registered Company Number: 11882388 
Registered Address: Kemp House, 152-160 City Road, Islington, London, England, EC1V 2NX
VAT Registration Number: 318 2625 10

©2020 Matt Davies Consultancy Ltd. Nottingham UK.