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Employer branding- A strategic approach for talent acquisition in India: A view point
Abstract:
Purpose The rationale of this manuscript is to reassess the existing literature correlated with emerging areas of
employer branding accumulating insight from the viewpoint of current need of the organisation and
Design/methodology/approach The approach was taken involving reassessing various journals and articles from
referred journals which include area of research that explore organisational attractiveness to potential new
recruits, research and writing linked to the psychological contract literature as well as work that scrutinizing
organisational uniqueness, organisational credentials and organisational behaviour quality features.
Research limitations/implications The major limitation of this paper is that, while analysing effective employer
branding might involve, the literature and research in each area will be (necessarily) selective to individuals
perception.
Practical implications The review
Originality/value The originality of the review is that it is unique in showing how different areas of literature can
be linked to employer branding. The review helps to integrate the existing literature in a way which can help
personnel practitioners to immediately see the relevance of theories and research from a range of key academic
fields.

Introduction:


Competitive labour markets aside, competition for employees is likely to become an increasingly
important issue as the worldwide population ages. With some regional differences, employment
levels in many developed economies are very high, and competition for skilled staff is intense.
Concomitantly, due to the pressures of a changing demographic base, the demand for intellectual
capital-a cadre of highly skilled, independent, internationally marketable and mobile
individuals-is exceeding the available supply (Ewing et al., 2002; Ployhart, 2006). In employment
markets characterised by high competition, obtaining suitable human resources becomes increasingly
problematic as the number of applicants per vacancy declines. The tight labour market gives highly
competent employees many choices (Srivastava and Bhatnagar, 2008) especially in
professional, information / knowledge based, technical and service driven organisations (Ewing et
al., 2002). The CIPDs recent report on Next-Generation HR emphasises the need for insight-led HR leaders who
are more alert to what is going on outside and inside the organisation, and able to harness these insights in ways
that improve business performance and employee engagement (CIPD, 2011). This has critical consequences
for the recruiting organisations (Rynes, 1991) as it leads to the most pressing problem of talent
acquisition- of attracting people with the right skill set and competencies who also fit the need and
the culture of the organisation (Bhatnagar and Srivastava, 2008). Organisations that attract a larger
applicant pool and more qualified applicants obtain greater utility in their selection systems
(Boudreau and Rynes, 1985) and a potential competitive advantage (Lado and Wilson, 1994).

India, a hierarchical society, is considered to be high in power distance and collectivism (Deshpande
and Farley, 1999). Earlier studies on similar studies on employer brand have been conducted on
Belgian army (Lievens, 2007), university students in the U.K. (Knox and Freeman, 2006) and Australia
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(Berthon et al., 2005) etc, which differ from India on the cultural dimensions (Hofstede and Hofstede,
2005). We propose that in India, the factors that build up a strong employer brand, attractive
enough for its talent pool are different from the other parts of the world as they differ in their
cultural and managerial environments. It is precisely these differences that raise the issue of
whether earlier research on this subject is generalisable to India. Since the Indian talent is in great
demand globally, the multinational organisations need to understand the perspective of an Indian
talent to develop their employee value proposition accordingly. Due to these surroundings, the role of
employer has become more critical and potential for hiring and retaining human capital by using employer
brand as tool for creating competitive advantage (Berthon, Ewing and Hah, 2005). It is necessary to
understand the dimensions of employer brand in the Indian setting in order to help the global
organisations to model their recruitment strategies for India. Even though firms ordinarily emphasis
brand management in the field of marketing toward developing product, brand can also use in the field of
human resource management, in term of employer branding (Backhaus and Tikoo, 2004). Ployhart (2006)
explains that the shortage of talent to meet the need of organization is one of the popularity issues in
current competitive era.

Employer branding is viewed as the process of placing an image of being a great place to work in the mind
of potential employees (Ong, 2011). Likewise, Edwards (2010) argues that employer branding involves the
firms values, systems, policies, and behavior toward the aim of attracting, motivating, and retaining the current
and potential employees. It can be said that employer branding is a crucial tool as strategic management of
human capital and talent. That is why modern organizations pay more and more attention to employer
branding.

The key objective of this research is to examine the relationships between employer branding and
organizational competitiveness via talent management competitiveness and organizational attractiveness.
Also, this research tests the factors such as job characteristics, organizational characteristic, employer image
and reputation, and competitive challenge as antecedents in the relationships of the model. The main
research question is how employer branding affects organizational competitiveness. This research is
organized as follows. The first part presents the literature review on employer branding that leads to
outcomes and the antecedents that affect employer branding. The second part details research methods,
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including data collection, measurement, and statistics. The results are discussed and shown.
Consequently, contribution, limitations, future directions, and conclusion are described.

2. RELEVANT LITERATURE REVIEW AND RESEARCH HYPOTHESES

Resourced-based view of firm (RBV) is a theoretical framework that explains how resources and
capability which is values, rare, non-substitute and non-imitate is often treated as building the capability to
achieve competitive advantage (Barney, 1991)). Competitiveness or competitive advantage is normally
defined as the ability to earn superior performance constantly above the average for the industry. When
the strategies are successful in leveraging the firms rare, valuable and difficult-to-imitate resources, firm is
likely to gain an advantage over its competitors in the market place and thus earn higher returns. In this
research, RBV is applied to explain employer branding as a strategic success factor to enhance the
competitive advantage of a firm (Aggerholm et al., 2011). Likewise, Berthon et al., (2005) claims that employer
branding contribute to the organizational advantage and performance. In addition, this research expects that
job characteristics, organizational characteristics, employer image and reputation, and competitive challenge
are that factor that affect employer branding. Thus, a conceptual model of this research is shown in
Figure 1.

FIGURE 1
CONCEPTUAL MODEL OF THE ANTECEDENTS AND CONSEQUENCES OF EMPLOYER
BRANDING




2.1 Employer Branding
The definitions and dimensions of employer branding have been used by several scholars. Ambler and Barrow
(1996) initially introduced employer branding to HRM discipline and defined the employer brand as the
package of functional, economic and psychological benefits provided by employment, and identified
with the employing company. Moreover, Lloyd (2002) argues that employer branding is sum of a
companys effort to communicate to existing and prospective staff that it is a desirable place to work.
Likewise, employer branding is viewed as the companys image as seen through the eyes of its
associates and potential hires to which it is like to work with (Katoen and Macioschek, 2007). It can
explain that employer branding considers current and potential employees as branding targets. In this
research, employer branding refers to all processes of placing an image of being a great place to work by
recruiting, attracting, motivating and retaining employees to contribute to firm performance. Ambler and
Barrow (1996) argue that employer branding includes functional, economic and psychological benefits.
Furthermore, Berthon et al., (2005) classified employer branding into five dimensions namely, social,
development, application, interest and economic values. On the other hand, the study of Lievens et al., (2003)
classifies employer branding into two elements including: Instrument attributes and symbolic attributes.
Furthermore, Schlager et al., (2011) develops a framework for employer branding as economic, development,
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social, diversity, and reputation vales. This research emphasizes functional aspects and emotional aspects
in the study by Lievens et al.,( 2003) and Ong, (2011). This is because these two practices represent the
attributes of employer branding as objective and subjective aspects to better
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reflect the current and potential employees. For the relationship between employer branding and
organizational competitiveness, several studies reveal that employer branding has a positive impact on
organizational competitiveness via talent management (Chapman et al., 2005; Yaqub and Khan, 2011) and
organizational attractiveness (Davies, 2008; Backhaus and Tikoo, 2004). In order to clearly investigate
the relationship between employer branding and competitiveness, this research describes employer
branding as follows:

Functional Aspect of Employer Branding refers to the objective or tangible attributes that characterize in
job or organization such as pay, compensation, location, opportunities for advancement, career program
and benefits that determine the attractive of the firm (Ong, 2011). Talent management depends on various
HR practices such as search of talent, talent hunt, develop human capital, and retain potential employees.
Schlager et al., (2011) concluded that functional values such as good salary, reasonable benefits, and
quality workplace affect potential employee attitude. Moreover, both monetary and non- monetary
benefits are the most obvious factors in a persons choice of workplace and are mentioned as an important
determinant of employer attractiveness (Weathington, 2008). Similarly, literatures outlines that a better
talent management and retention can play an important role for organizational success (Bhatnager,
2007). Likewise, Foster et al., (2010) argue that employer brand by using brand image in the market enhance
talent management effectiveness. Similarly, Chapman et al., (2005) states that employer branding is directly
related to talent management. Consequently, previous studies state that employer branding in functional
attributes such as high salary, fair compensation, reasonable benefits and quality workplace is directly
related to talent management (Schlager et al., 2011; Yaqub and Khan, 2011; Ong,
2011). In most research it is assumed that employer branding is positively related to on organizational
attractiveness (Berthon et al., 2005; Lievens et al., 2005; Lievens et al., 2007) and employee productivity
(Backhaus and Tikoo, 2004). As such, employer brand has great power to serve as a platform for
designing talent strategies to increase performance. Thus, these ideas lead to posit the following hypotheses:

Hypothesis 1: Functional aspects of employer branding is positively related to (a), organizational
competitiveness, (b) talent management effectiveness and (c) organizational attractiveness.

Emotional Aspect of Employer Branding refers to subjective or intangible attribute that characterize in job
and organizational such as innovativeness, competence, prestige, communication, and excitement which is
importance of engaging employee commitment, satisfaction and loyalty that lead to firm performance (Ong,
2011). To this vein, organizations must create a work environment in which employees feel a sense of
pride, accomplishment, unity, and image, which enables their organization to succeed. To manage employer
branding in emotional aspects, company should build HR practices by training opportunities, empowering
employees, creating creativity environment, empowerment, and building a social culture. In this way,
employer brands also support an organization's ability to have an easier time attracting, developing and
retaining quality people, and leading to increased performance (Barrow, 2005). Moreover, perceived
organizational support, promotion opportunity, strong team spirit, and challenge task are known as good
reputation that strongly related to employee attitude in attracting new high-potential and current
employee (Schlager et al., (2011).The study of Davies (2008) reveals that the emotional of employer branding
influences employee satisfaction, affinity, and loyalty. Slaughter et al. (2004) focused on the symbolic image
dimensions and confirmed that they were related to organizational attractiveness. Thus, these ideas lead to
posit the following hypotheses:

Hypothesis 2: The emotional aspects of employer branding is positively related to (a),
organizational competitiveness, (b) talent management effectiveness and (c) organizational attractiveness.

2.2 Talent Management Effectiveness
The study of Babo and Rodrguez (2010) proposed talent management as the additional management,
processes and opportunities that are made available to people in the organization who are considered to be
talented. Talent management strategies focus on five primary areas: attracting, selecting, engaging,
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developing and retaining employees. In this research, talent management effectiveness refers to the
ability of firm to recruit, select, develop, and retain potential employee according to organizations needs.
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In recent competitive era, talent management is very important for business to create competitive
advantage over competitor. Recent study shows that effective talent management provides one of the
most critical points of strategic leverage today that increase bottom lines (Kehinde, 2012). Huges and Rog
(2008) assert that core job of talent management by developing high potentials make the organization
attractive for the potential employees. Likewise, Yaqub and Khan (2011) argue that talent management is a
useful tool for employer to strengthen the brand of organization which can improve organizational
attractiveness. Thus, these ideas lead to posit the following hypotheses:

Hypothesis 3: Talent management effectiveness is positively related to (a), organizational attractiveness
and (b) organizational competitiveness.

2.3 Organizational Attractiveness
Ehrhart and Ziegert (2005) define organizational attractiveness as a degree to which getting potential
candidates to view the organization as a positive place to work whereas Highhouse et al. (2003) suggests that
organizational attractiveness is viewed as individuals affective and attitudinal thought about particular
companies as potential places for employment. In this research, organizational attractiveness refers to the
ability of firm to attract potential employee and the candidates both internal and external organization to join
with. Carless and Imber (2007) stated that organizational attractiveness is influenced the recruitment
process and job offer. Attractiveness can be described based on two elements namely familiarity and
reputation which direct positive relationship with financial performance (Lievens et al.,
2005; Bondarouk, 2012). Griepentrog et al., 2012) found that organizational attractiveness significantly
predict withdrawal behavior. In addition, Cable and Turban (2001) argue that organizational attractiveness can
gain competitive advantage for employer through required skills and competency. Thus, these ideas lead to
posit the following hypotheses:

Hypothesis 4: Organizational attractiveness is positively related to organizational competitiveness.

2.4 The Influence of Antecedents
Job Characteristics refer to the job design that results in three psychological states namely
meaningfulness of the work performed, responsibility for work outcomes and knowledge of the results of
work performed that bring about positive work outcomes (Hackman and Oldham, 1975). In addition, Job
characteristics can explain in five core works such as: 1) skill variety 2) task Identity 3) task significance 4)
autonomy and 5) feedback from the job (Bondarouk, et al., 2012). Job activities for create organizational
branding can viewed as challenging and interesting work, freedom to do the work your own way, new learning
experiences, variety in activities, (Cable & Turban, 2003; Schuler, 2004). The study of Foster et al., (2010)
noted that employees perceived functional aspects with challenging task, variety of tasks and unique
opportunity of employment increase brand employer values. In addition, Backhaus and Tikoo (2004) have
described that the interesting job characteristics drive a positive employees attitude with the company to be
a good place to work. Thus, these ideas lead to posit the following hypotheses:
.
Hypothesis 5: Job characteristics are positively related to (a) functional aspects of employer branding
and (b) emotional aspects of employer branding.
Organizational Characteristics refers to the design of structure, systems, process and policy, leadership
and regulation which influence the behavior of people in organizations and the nature of their
relationships with other people while doing their job. The degree to which decision-making is centralized or
decentralized is a key indicator of the manner in which an organization allocates resources and
determines policies and objectives. Lievens et al., (2007) and Edwards (2010) state that the designs of
good reward and fair incentive structure are related to employer values. In addition, the simplify and
continuous improvement of organizational process by eliminating unnecessary procedures and keeping the
process relevant and simple can help to improve a new ways of working which motivate potential employee to
work with and ultimately, increase employer branding (Berthon et al., 2005). Moreover, the study of Backhaus
and Tikoo (2004) state that employer branding can be shaped by organizational culture that related
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to organizational identity and in turn affect employer brand loyalty. When organizations clarify and
carefully manage their employment experience, it would help create values and influence which specific and
unique for employment offering. Moreover, Berthon et al., (2005) assert that
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organization culture such as good citizenship, humanitarian values, customer-oriented and belonging
influence employer branding. Thus, these ideas lead to posit the following hypotheses:

Hypothesis 6: Organizational characteristics are positively related to (a) functional aspects of
employer branding and (b) emotional aspects of employer branding.

Employer Image and Reputation refers to a set of perceptions that people have of organization
(Heilmann, 2010). In addition, the company employment image can be viewed as an impression of the
organization as a good place to work. The study of Lemmink et al., (2003) indicated that a good image
can generate an advantage of attracting better job applicants intentions. It can be said that the
perception of what kind the organization is as an employer. Previous study argues that the image and
reputation of organization is an important factor to create employer branding (Lieven et al., 2007;
Schlager et al.,
2011). A key finding from Turban and Green (1996) indicated that when organizations were rated higher
on a full range of social responsible feature, they tended to seen as more attractive as potential employer
branding. Likewise, Edwards (2010) argued that good image and reputation of organization are
important for potential recruit and retain which has an existing positive to employer branding. In addition,
Kim et al., (2011) show that corporate image can influence employment brand equity. Thus, these ideas
lead to posit the following hypotheses:

Hypothesis 7: Employer image and reputation is positively related to (a) functional aspects of
employer branding and (b) emotional aspects of employer branding.

Competitive
Challenge
Competitive challenge is defined as the desire and determination to confront with serious and
unused threat competition to attain outcomes over competitor (Jirawuttinunt and Ussahawanitchakit,
2011). Competitive challenge also reflects managerial willingness in being alternative in method of
competing. Company today faces with critical business challenge such as globalization, technology and
intellectual capital that make organization pay attention to adapt competitive action. Many prior studies
found that the competitive environment impacts firms strategic development (Ocass and Ngo, 2007). The
challenge for manager is to be the ones that focus most of attracting, developing, and retaining
employee by using best-suited internal practices as competitive advantage. From now on, the role of
HR is to acquire new skill, knowledge and capabilities to ensure business. Thus, employer branding is a
process that address the competitive challenge facing as a whole by leveraging HR as worthy of
company. In summary, competitive challenge concerns intensity of competition that is a factor
contributing to develop an image of being a great place to work in recruiting, attracting, motivating
and retaining employees. Thus, these ideas lead to posit the following hypotheses:


Firms need to develop strategies to ensure that their human-resource base remains adequate for
the challenge of doing business. In increasingly competitive employment markets, developing
strategies to become an employer of choice and to increase the number of applicants per advertised
vacancy can facilitate the recruitment of suitable employees and provides a strategic advantage
to the firm.


By adopting a resource- based view of the firm, the importance of human capital as a source of
competitive advantage becomes apparent (Amit & Schoemaker, 1993; Hanson, Dowling, Hitt,
Ireland, & Hoskisson, 2002), and securing qualified staff becomes a strategic imperative.
Following this logic, Branham (2001) suggests employer branding as a means of ensuring access to
potential employees.
The employer brand is the package of psychological, economic, and functional
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benefits provided by employment and identified with an employer (Thorne, 2004).
Manipulating these benefits to position the firm in the minds of potential employees as a great
place to work (an employer of choice) is the role of employer branding (Branham,
2001).
Closely related to employer branding is internal marketing, which considers the company
to act both on consumer and employee markets (e.g. Papasolomou- Doukakis, 2003).
The basic tenet of the internal marketing approach is that good customer service is only
possible if employee satisfaction and motivation are high (e.g. Berry & Parasuraman, 1992).
Consequently, internal marketing suggests that jobs are managed in a similar manner to
products, and that the company should use marketing techniques to design jobs to meet
both the employees and the firms needs, and to communicate the benefits of
employment to internal and external markets. Creating a strong employer brand will have
positive consequences for communicating these benefits.
Several scholars assert that brands and human capital constitute some of the firms most
important assets (Aaker, 1991; Backhaus & Tikoo, 2004), and that the development
of these intangible assets is an important task for marketers and human-resource
managers (Sutherland, Torricelli, & Karg, 2002). The human capital involved in the
design and offering of products in general, and the delivery of services in particular,
influences perceptions of the firms consumer brand in the market (e.g. Papasolomou-
Doukakis, 2003). Simultaneously, the firms consumer and employer brands affect how
existing and potential employees perceive the firm.
Whilst much attention has been dedicated to examining the role of branding from a
customer perspective and associated customer-based brand equity (e.g. Taylor, Hunter,
& Lindberg, 2007), relatively little research has explored the role that branding plays in
retaining and attracting employees that constitute the firms human capital and,
ultimately, contribute to the efficient and effective delivery of products and services. This
paper addresses this research gap and focuses on developing a better understanding
of the role that branding plays in attracting human capital to the firm, as this is the
stage when employee expectations are set. More specifically, we adapt and test a modified
consumer-based brand-equity model in the context of employment markets, and
present a new conceptualisation of employee-based brand equity.
To achieve this, the paper is organised as follows. First, we present a review of extant literature in
cognitive psychology and signalling theory relevant to brand equity. In this section, we analyse
the employment market from a signalling perspective. Second, we synthesise this literature
and develop a conceptual framework to explain employee-based brand equity. Based on this
conceptualisation, several propositions are derived. Next, we discuss our research approach and
present the findings of preliminary, qualitative research. Finally, we conclude the paper with a discussion
of the implications of our study and directions for further research.

Term Definition Context/Relations
Employ
er
brand
Package of functional, economic
and psy- chological benefits
provided by employment, and
identified with the employing
company (Ambler & Barrow,
1996)
Final outcome of all
brand-related activities
Employ
er
brandi
ng
All decisions concerning the
planning, crea- tion,
management and controlling of
em- ployer brands and the
corresponding activi- ties to
positively influence the employer
preferences of the desired target
groups (Petkovic, 2009);
Process of placing an image of
being a great place to work in the
mind of the targeted candidate
pool (Branham, 2000)
Process to reach the desired
outcome of being an
attractive employer
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T
Employ
er
brand
equity
Set of employment brand assets
and liabilities linked to an
employment brand, its name and
symbol that add to (or subtract
from) the value provided by an
organization to that
organizations employees (Ewing,
Pitt, de Bussy & Berthon, 2002)
Influences the likelihood
that a given employer will
be chosen over a
competitor due to its
unique, favorable employer
image that is conveyed
through the employer
brand; brand equity
generates positive affect
towards the branded
organization
Employ
er
image
Potential applicants attitudes
and perceived attributes about
the job or organization (Collins &
Stevens, 2002)
Associations towards the
employing company that
are conveyed through its
employer brand, which can
be further specified by
means of instru- mental and
symbolic image facets/
attributes; unlike
attractiveness attri- butes,
image facets do not
necessar- ily have to reflect
favorable associa- tions
Employ
er
attracti
ve-
ness
Envisioned benefits that a
potential em- ployee sees in
working for a specific orga-
nization (Berthon, Ewing & Hah,
2005)
Antecedent of employer
brand equity; influenced by
employer image; the
envisioned benefits can be
concep- tualized, just as
employer image attri- butes,
through instrumental and
sym- bolic features, which
have to convey favorable
associations in order to
contribute to attractiveness
Employe
r value
proposit
ion
Application of a customer value
proposition
why should you buy my product
or service
to the individual why should a
highly ta- lented person work in
my organization? It differs from
one organization to another, has
to be as distinctive as a
fingerprint, and is tailored to the
specific type of people the
organization is trying to attract
and retain (Sparrow & Cooper,
2003)
Aims at inducing positive
brand asso- ciations and
hence a favorable em-
ployer image; encompasses
the most important
employment benefits (in-
strumental attributes) as
well as key organizational
values (symbolic attri-
butes), which reflect the
organiza- tions identity


Employer branding is the image of the organization as perceived by the employees as well
as other stakeholders. It helps differentiate a firm from its competitors. The employment
brand highlights the unique aspects of the firms employment offerings. Employer
branding is about capturing the essence of a company in a way that engages employees and
other stakeholders. It involves promoting both within as well as outside the firm and
makes a firm different and desirable as an employer. The manifold objective of employer
branding is to convince the employees that their organization is a good workplace, to
retain them and to ensure their understanding of the organizations goals and
commitment is in synchronization with the organizations vision and mission. The process
of employer branding can be viewed as a holistic one, which presents the way in which
the organization develops its employees positive attitude and commitment towards the
organization. Organizations comprise both external and internal stakeholders. The internal Employer branding
undoubtedly is one of the most important precepts of modern
management, one that offers a fine blending of the science of marketing with the art of
enlightened human relations management. It is also one of the strongest bulwarks ever
against the scourge of unbridled employee attrition.


INTRODUCTION

he current business environment is marked with challenges of intense global
competition, rapid technological changes, growth of the knowledge economy, and the
need for flexibility and expertise in the workplace (Catteeuw et al., 2007; Wickham
and O'Donohue, 2009). This has resulted in the changing skills and competency requirements.
Prospective employees are as particular about choosing the right organisation as about
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choosing the right job (Rynes and Cable; 2003). Hence, organisations are increasingly
trying to assess and enhance their attractiveness to prospective applicants
(Highhouse et al., 1999). This has critical consequences for the recruiting organisations
(Rynes, 1991) as it leads to the most pressing problem of talent acquisition- of
attracting people with the right skill set and competencies who also fit the need and the
culture of the organisation (Bhatnagar and Srivastava, 2008). Organisations that attract a
larger applicant pool and more qualified applicants obtain greater utility in their
selection systems (Boudreau and Rynes, 1985) and a potential competitive advantage
(Lado and Wilson, 1994). India, one of the world's largest economies, has made giant
leap in its economic and social development in the past two decades and has proven itself
to be a major economic and intellectual power (Kapur and Ramamurti, 2001). It is the major
source of the world's largest English speaking low cost workforce, with a high level
technical and managerial talent fuelled by world-class institutes in India like Indian Institute
of Technology (IITs) and Indian Institute of Management (IIMs). Being industrious, hard
working and focused on merit based and education dependent advance,
Indian human skills are in great demand (Nath, 2008). Indian workforce is most sought