employee reviews influence company reputation photo by http://www.flickr.com/photos/great_dream/

employee reviews influence company reputation photo by http://www.flickr.com/photos/great_dream/

Why Indeed May be More Important to Your Company’s Reputation Than LexisNexis or Yelp

Companies clearly understand that a great reputation means a stronger bottom line. This is most often reflected in customer reviews or company trust metrics, but increasingly, reputation is now measured by employees, the people that make up companies themselves.

Employee opinions can guide the decisions of job seekers, but their influence stop there: your rank-and-file employees are the most trusted voice to speak on your reputation not just to job seekers, but to customers, investors, and the public at large.

Positive Employer Reputations are Good Business

Employer reputation depends on one simple truth: great employees want to work for great companies. It’s not hard to understand why human resources and morale has a major impact on reputation. Companies known for great benefits, advancement, and good working conditions will attract the best talent. And the best talent creates the best product, no matter what industry you’re in.

It’s no coincidence that many of the companies that are considered the best to work for are also among the most successful and respected in the world. Fortune‘s Best Companies to Work for shares several entries with the Fortune 500: Microsoft, Google, Apple, Qualcomm, and NetApp, to name a few.

A good reputation is one of the best recruiting tools available to a company. Who wouldn’t want to work for a company that employees love to rave about?

83% of Job Seekers Make Applying Decisions Influenced by Reviews

In today’s age of the digital job search, online reviews are what job seekers turn to in order to identify the companies most worthy of their talent. Job seekers interested in learning more about what a company has to offer want to hear from employees on benefits, business practices, and working conditions. And it’s these employee reviews that make a company’s reputation in the job market so valuable.

Indeed’s survey indicates that job seekers are greatly influenced by company reputation. They consult reviews when deciding which companies they’ll apply to, and which companies they’ll ultimately accept offers from.

Indeed’s survey revealed:

    • 83% of respondents are influenced by reviews when deciding where to apply
    • 46% reported that a company’s reputation had a significant impact on their job offer decision

“Just as reviews have had a profound impact on the way we shop, employer reviews are changing the way people search for their next job,” explains Indeed’s senior vice president of product engineering Chris Hyams. “The opinions and experiences of current and previous employees are significantly impacting how employers are perceived by potential employees.”

Indeed’s own metrics support this assertion: the site has seen that employers that have reviews on their company pages will experience a 5% increase in the number of job seekers that apply.

Even Desperate Job Seekers Won’t Work for a Company With a Bad Reputation

But in a recovering economy with 10.4 million unemployed workers, can job seekers really afford to be picky about a company’s reputation? A survey from Corporate Responsibility and AllegisTalent2 says they can, and they are. 75% of Americans would prefer to stay unemployed rather than work for a company with a bad reputation. And 87% of currently employed workers would consider leaving their current job to take on a role with a company that has an excellent corporate reputation. They’d even do it for a minimal 1 to 10 percent increase in salary.

“A positive corporate reputation is extremely high on the list of must-haves for the American workforce, especially as they examine career paths or future employment opportunities,” says AllegisTalent2 executive vice president/general manager Randolph Gulian.

A Bad Reputation Means Higher Recruiting Expenses

Companies with a bad reputation among employees may find it difficult to attract and hold on to top talent. Job seekers who see scathing reviews from former employees, negative news stories, or major corporate scandals may move on to seek employment with companies that don’t pose such a high risk to their careers and financial future. That means higher expenses for recruiting employees — not to mention missing out on strong talent that could positively impact the company.

“The cost of recruiting and retention is higher for companies that have a bad reputation,” says Richard Crespin, the chairman of the COMMIT!Forum. “We often see in the wake of a scandal employees leave and it’s harder for the company to retain them.”

Your Employees — Not Your CEO — Have the Loudest and Most Trusted Voice of Company Reputation

Reviews are so valuable to job seekers — and everyone else interested in learning more about companies — that they’re trusted more than industry analysts, CEOs, even government officials or regulators. According to the Edelman Trust Barometer, short of hearing from experts, people want to know from their peers what a company is really all about. In Edelman’s spokesperson credibility measurement, 67% and 66% of those surveyed trust academics or technical experts the most, followed shortly at 62% trusting “a person like yourself.”

employees are the most trusted voice to speak to your company

employees are the most trusted voice to speak to your company’s reputation according to edelman

In fact, Edelman’s barometer indicates that employees are the most trusted source to communicate on a company’s areas of reputation, including engagement, integrity, and operations. Employees are trusted more than CEOs, academics, and media spokespeople. Perhaps most interesting: employees are the most trusted influencer even over activist consumers in every topic except for company purpose. That means your employees are the single most important voice to speak on your company’s reputation. Are they saying what you want to be heard?

How Companies Can Develop a Positive Reputation Among Employees

It’s clear that developing a positive reputation among your own employees is essential to success in recruitment and beyond. How can companies ensure that they’re doing all they can to make sure employees feel positively about where they work?

Randstad, the second largest HR services and staffing company in the world, says that it’s all about positive employee engagement, noting that factors including flexibility and corporate culture, along with employee salaries, are essential to morale, productivity, and retention.

Randstad recommends companies drive employee engagement by:

        • Offering flexible work arrangements or reduced hours
        • Encouraging employees to share their ideas and opinions
        • Providing a stimulating workplace
        • Rewarding high performers with bonuses and promotions
        • Investing in training and skill enhancement activities

Reputation management often focuses on public or customer opinion, but companies shouldn’t forget to look inward. Your employees can be the most positive voice for your company — or the darkest spot of your reputation. Does your company have a positive reputation as an employer?

Photo of Joseph Torrillo
About the Author

Born and proudly raised in Syracuse, NY, Joseph joined the team in 2008 as the Director of Reputation Management after earning his B.S. in Public Policy. He is now the Vice President of the department.

More