Human Capital Outlook
Overview

Web 2.0, Corporate Reputation & employment relationships.



There has always been a strong correlation between corporate reputation & talent, companies with good or exemplary reputations have been generally seen as able to attract & retain the best talent. This concept gave birth to the notion of employer branding (a direct branding effort showcasing information on business, culture and benefits of working for this company to potential employees) & this quickly became a central concept in HR Marketing. Most Indian IT companies caught on with the concept post the dot com bust (peaked during 2003-04 & 04-05), & thus pitched their efforts in the pursuit of "Employer of choice" status for their organisations.

Again specifically relating this to the Indian IT scenario, with increased competition amongst IT firms to hire the best talent, many have gone a step further. They have exemplified the use of Employee Branding (which is an indirect branding effect where company employees serve to characterise their company`s Employer Brand.) Thus one would see advertisements from several such IT companies having their employees voice their opinion on their place of work (particularly in 2005-06 & current).

However, with the advent of Web 2.0, the relationship between corporate reputation & employment relationships is strengthened even further. These concepts (of employer & employee branding) would seem traditional soon & will be made redundant with enormous amounts of time, energy and financial resources wasted. We are soon to witness developments which would have a profound impact on the people strategies of employers in India & as well as anywhere in the globe, where ever there is a talent crunch, whatever be the size of the company.

The concept of Web 2.0 is as follows- within a period of 36 months, the Internet has well moved on from static applications like Google Maps, Mapquest to more dynamic applications like various blogspots, Orkut, Myspace et al which derive their existence (& updation) from the human connections & networks formed around these portals. Besides, users can voice & leave their comments on a product, service, brand & thus generate an authentic, first hand feel of the user- experience associated with the product or service.

Web 2.0 has totally changed the way we make our purchasing decisions like previously the internet changed the way we bought (online payments). My wife loves to sniff through various sites studying customer reviews for almost anything she wishes to purchase- be it a digital camera, our new car or which hotel in Allapey (Kerala). She is able to read through experiences of real people who bought & used the product or service & this is trusted opinion, she no longer trusts advertisements or any experts giving their opinion. There seem to be several like her if the number of reviews written is any indication.

Hence, in the case of brands, the fact that the customer is now being given a real ‘voice which can be heard by others’ is transforming the way purchasing decisions are being made. Its direct parallel in the talent space has profound implications- in the case of employers, what an organisation says about itself is no longer as important as what its employees think of it. It is not far when such employees would start voicing their opinion on an employer, candidates could publish on the internet reviews on their experience with the selection processes in a company etc.

How much does a company promote work- life balance? Does it have any innovative hiring practices? What about rewards & recognition? How good are the company’s training programs? How regular are internal movements within the group? How demanding is the environment for a woman employee? One could easily research & compare companies on the same criterias!! This surely would have widescale ramifications threatening to transform the entire employment landscape.

Preconceived notions about a particular company or set of companies (say large companies as a group or for that matter, public companies as a set) would either be easy to clear or could be reinforced many times & strongly, it could be challenged strongly or left unchallenged at all! Every employer would necessarily be at the same level as the other in terms of their attractiveness quotients.

A smaller company would be able to attract far more talent than it otherwise ever has, thanks to the positive reviews it gets from employees who experienced this company. It is quite ironical that this company could be a relatively unheard brand (remember ‘employer brand’!). At the same time, false positive perceptions about a big company could be changed forever.

Given the forces at play, such a scenario is most definitely to happen, the only question is how soon does it impact. HR experts along with Branding & Communication specialists need to jointly apply their energies & thinking to evolve next breed reputation & brands.

HR strategies thus come at the centerstage of corporate play even more with not branding but bonding, relationships & employee commitment becoming the core intangible assets.