Fortune Magazine’s 100 Best Companies to Work For list came out last week, and if your firm isn’t on it, your recruiting and branding strategy can only be judged as a failure. Why, you ask? It is simply because there is no other action or program that has as dramatic an impact on a company’s long-term recruiting than being highly placed on the Fortune list. The results for this year include Edward Jones and The Container Store, repeating their #1 and #2 finishes respectively of last year. Other firms that were highly placed or that made a significant improvement in their rankings included Xilinx at #4, Adobe Systems at #5 and Wegman’s Food Markets at #10. Because each of these firms has excelled in developing their people programs, they are assured a high volume of quality applicants. Advantages of Being on the List The advantages of being on Fortune’s list include:
- Building your employment brand. Nothing will get you noticed among potential applicants as a great place to work faster than getting on the Fortune list. In addition to being noticed by those who actually read the magazine, getting on the list also guarantees that your firm will be highlighted in several industry and local publications, because getting on the list invariably means that reporters and journalists will call your firm to ask how you handle different human resources management problems. All of this publicity adds up to significant name recognition that becomes your “employment brand.”
- Benchmarking. The publicity you get from being mentioned on the list will also open up numerous benchmarking opportunities for you. Companies that, in the past, wouldn’t even return your calls for benchmarking information will now respond the next day. In addition, your HR department will get an increasing number of benchmark calls from leading firms asking you how you operate. This publicity will dramatically build the pride of your HR function and it might also provide you with ideas on additional HR programs that you might “borrow” from other firms.
- Quality and number of recruits. Ranking high on the list guarantees you publicity and, even better, an increased flow of top-quality applicants ó in some cases, as much as double the flow of applications prior to the recognition. The quality of the applicants will also increase because people from other regions and industries will learn about the features that make your company a great place to work. Remember that attracting great applicants is similar to a restaurant’s attempt to attract customers. The publicity from getting a great review will have a much greater impact than any newspaper ad ever could.
- Lower costs. The name recognition that you receive by being on the Fortune list lasts for years. The increased applicant flow will allow you to decrease normal advertising costs and recruiting expenditures because your website alone will provide more than an adequate volume of high-quality candidates.
- Retention. Ranking on “best of” lists directly impacts retention rates. It builds pride among your current employees and serves to remind them of the many positive benefits that result from being a part of your organization. Being recognized makes it a more difficult decision to leave the firm because few other firms offer quality people programs. Their friends and family will wonder out loud, “What were you thinking?”
- Referrals. It builds employee referrals. Because employees now have the ranking and the reasons behind it to back them up, they have much more to talk about when initiating a recruiting conversation.
- Sales. A listing has an indirect impact on sales and market position due to the increased recognition and publicity that occurs following the listing. Several studies have produced evidence that being “known” as a great organization translates into increased sales, because customers directly associate being a great place to work with perceived product quality.
- A source of pride. In addition to the financial benefits of making the Fortune list, most companies seize the opportunity to publicize their ranking. For example, Wegman’s Food Markets, a five-year veteran of the Fortune list, has provided all employees with brightly colored T-shirts that recognize their significant accomplishment. Continental Airlines, also a five-year veteran, has painted its accomplishment on the side of its airplanes. Your internal image will also improve as executives see the positive recognition that your well-designed people programs have brought to the firm. Such recognition instantly moves you from being considered as an “administrator” to being considered as a strategic contributor.
How Do You Get on the List? The list is managed by the Great Place to Work Institute in San Francisco. The staff at the Institute are among the most knowledgeable HR professionals I’ve ever met, because the organization gets to review nearly every great people program in the world. You must apply to be considered for the Fortune list. There is an extensive application process and an anonymous employee survey which can help a firm understand what their employees like and dislike about their workplace. The application process itself is an excellent method for categorizing and assessing your own people programs. I’ve advised numerous firms on the process of getting ranked and I have repeatedly found that the assessment process is the best HR audit tool available. The list of people programs that you compile for your application also provides a wealth of information that you can use to improve your recruiting message and recruiting materials. What People Programs Do the Top Firms Have? There is no magic list of people programs that are required to get you on the Fortune list. But in general, the following types of programs are the ones that are offered by the top firms on the list:
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- High scores on the employee satisfaction survey
- Job growth or maintaining employment levels during economic downturns
- Compassionate layoffs when they do occur
- Opportunities for women, gays, and minorities (especially at the executive and board level)
- Work/life balance programs that can demonstrate that they reach a large number of employees
- Employee dignity
- Low turnover rates (relative to competitors)
- High salaries or stock options (generous compensation)
- Benefits that are offered equally to the “little guy” as well as to executives
- Environmentally and community friendly programs
- Demonstrating that you are a pioneer in your industry by being the first to offer unique benefits
- Flexibility in jobs (job sharing, work at home, or flexible schedules)
- Extensive training and learning opportunities offered to all levels of employees
Conclusion The importance of being on the Fortune list grows every year. The popularity of the list among employers is also growing (the number of potential applicants is currently close to 1,000 and it is steadily rising). The Fortune list’s increasing popularity is due largely to the fact that more and more recruiting departments have now realized that building a brand as a great place to work has one of the longest impacts and the highest ROI of anything you can do in HR. If you succeed, the results are phenomenal! If you do get on the Fortune magazine list, I guarantee you will get a call from your CEO, your achievement will be mentioned in the annual report (a rare event for most HR practices), and (at least from my experience) you will get a bonus! Yes, getting on the list is hard work, because success requires a strong HR brand manager, a structured process, and a great deal of tenacity. Because it takes a while to gather the information for the application and to improve any weak HR programs you might have, the time to start is now. Begin building your employment brand today while recruiting volume is low and you will reap the rewards when the economy turns around early next year.