Enhancing Employer Attractiveness to FMCG Talent

The fast-moving consumer goods (FMCG) industry has an extensive history of powerful brands, innovative products, and advanced operations and processes. However, in recent years, FMCG companies have seemingly become less attractive to prospective talent. According to LinkedIn, the FMCG industry has the second-highest employee turnover rate of any industry. This can be attributed to burnout as McKinsey‘s research found that FMCG employees were 30% more inclined than employees in all other industries to feel pressured to provide their employer with around-the-clock availability. Additionally, while this could be in part due to the steady decline of physical retail, we believed it would be vital to analyze recent trends in the FMCG industry to gather insight into how these companies can improve their workplaces to promote talent retention.

How we did it

We searched through thousands of publicly obtainable pieces of commentary on user-generated platforms; which consist of employer review sites, forums, social media, and others. We collected all the English language-based comments we could find in Q1 of 2022 (January to March 2022). We then used sentiment analysis to translate this to an Employer Brand Index (EBI) score using our bespoke EBI methodology. We score each company on a 0 to 10 scale, with 10 being the highest score you can get.

We analyzed several FMCG companies using data from the first quarter of 2022 for this research. It is important to acknowledge that this research is only representative of 3 months of data, thus, it should be viewed as a brief depiction of employer branding trends in FMCG companies in this time period. Nevertheless, two attributes stood out as key areas of concern; Change & Stability and Management & Organization, as seen in the Figure below. Focusing on these two low-scoring attributes, we explored both positive and negative themes within them to identify where FMCG companies are doing well and what areas can be improved.

The Change & Stability attribute reflects how talent feels about the stability of their jobs and the company more generally. This includes commentary on layoffs, long-term prospects, new hires, location openings/closures, restructuring, and company profitability. From the FMCG Q1 2022 data, three main themes were identified: job security, turnover and restructuring, and long-term opportunities.

In contrast, the Management & Organization attribute reflects how talent feels about the company’s leadership & the organizational structure. This includes commentary on the organizational structure, leadership competence, internal politics, and leadership decision-making. From observing the data from FMCG companies in Q1 2022, the main three themes highlighted were leadership style, bureaucracy affecting decision-making, and quality of communication.

What is going well at FMCGs

Leadership style 

As seen in the table above, it can be observed that ‘Great leadership displayed’ was a positive theme that universally applied to the three FMCGs in Q1 2022 in relation to their Management & Organization. Employee comments would include ‘They try to do right by employees by using the change management model from organizational leadership’ and ‘Many insights with the meta-leadership framework we’ve been teaching for years. Good to see this working at X’. This suggests that these explored FMCG companies attempt to use leadership styles that are rooted in change management models; which talent appreciate as it makes them feel further invested. As a result, this is a positive management practice in the FMCG industry that should be continued to retain valuable FMCG talent.

Job security

In times of inflation and the cost-of-living crisis, job security will likely be of high importance to talent. Therefore, a low score in change and stability could be of increased concern to FMCG companies. However, FMCG talent generally appears to be satisfied with the security of their careers currently.

FMCG brands may be seen as secure employers due to their high market profitability and ongoing company growth. They are well-recognized companies which means that talent tends to view them as having higher career stability than smaller companies. Examples of comments that support this include: ‘very stable, constantly trying to adapt to market trends and consumer behavior’ and ‘a very dynamic company with beautiful prospects of evolution’.

What can be improved at FMCGs

Bureaucracy 

It can be observed that bureaucracy is significantly decision-making and processes, which are universally applied to the analyzed FMCGs. The commentary would imply that talent feels out of the communication loop from management and feel dissatisfied with their position in the company. According to The Oxford Review, a potential solution to talent feeling bogged down by bureaucracy is to shift the thinking of management from rigid processes to a mindset that prioritizes the productivity and performance of the employees. This could be exemplified by recognizing the performance of talent more often. As a result, this may help employees believe they play a more integral role in the organization, which can be difficult to achieve when considering the extensive size of most FMCG organizations.

Quality of communication

Another area for improvement regarding Management & Organization is the quality of communication from management, with notable mention of management not expressing sufficient appreciation for the work of their employees. In particular, talent frequently mentions that management is only involved when there are complaints about their work output. This can be particularly detrimental to the job satisfaction of FMCG employees as these talents are described to have a skill set that is highly desirable to other sectors, such as adaptability and conflict management, according to Beamery. Subsequently, this can incline talent to leave FMCGs for other sectors that might appreciate and utilize the skills they have gained while working at FMCGs.

Turnover and restructuring

Talent discusses high turnover rates in FMCG companies, particularly in management and leadership positions. Frequent changes in management and leadership can in turn lead to increased turnover in lower seniority roles. As noted earlier, management and organization was the lowest-scoring attribute for FMCG in Q1 2022. Constantly evolving management could make talent feel as though they are struggling with mentorship. High turnover rates will also likely result in ineffective management and difficulties in developing positive team relationships.

FMCG talent is in high demand from other industries, as their skillset can easily be transferred to other sectors. This may explain why turnover is particularly high in FMCG companies.

FMCG talent was critical of frequent restructuring and its impact on the company. For example, at the beginning of 2022, Unilever cut 1,500 management jobs in an attempt to reshape the organization and promote growth. Commentary from FMCG data suggests that restructuring in management made talent feel as though they had a lack of proper guidance and created a detached environment within the workplace. While it is natural for companies to want to restructure as a response to a drop in growth and profits, the effects of restructuring on talent should be taken into account and minimized where possible.

Long-term opportunities 

Although job security was identified as a strength for FMCGs, commentary from Q1 does draw attention to the prevalence of temporary contracts and the lack of opportunities for newcomers and contracted staff. Some FMCG talent also expresses their dissatisfaction with an increase in outsourcing of roles in the company, while other FMCG talent highlight hiring freezes and changes to contracts in recent times. Practices such as outsourcing and a high percentage of temporary jobs could also contribute to heightened feelings of anxiety for talent surrounding job security.

Companies may consider temporary staff beneficial due to them being flexible and more cost-effective, but by limiting the number of permanent roles available, FMCG companies risk losing out on highly skilled and experienced talent.

Potential suggestions

Involving talent in decision-making

The corporate nature of the FMCG industry could be holding companies back in their ability to change and make new decisions. Making talent a part of the decision-making process can help them to feel more valued, and therefore is likely to lead to higher retention rates. A bureaucratic and overly structured work culture can make talent feel disengaged and increases the risk of burnout. Open communication and a more employee-centric approach should be encouraged to create a collaborative workplace. Not only would this help improve talent morale, but it could also help FMCG companies gain new insights into how they could change their company for the better.

Upskilling and reskilling

FMCG companies scored highly in the Learning & Development attribute in Q1 2022, in comparison to other attributes. A focus on upskilling existing talent could help with retention and discourage talent from moving to other companies. According to the Harvard Business Review, good training and onboarding is key to retaining young talent. Commentary suggests that onboarding and initial training in the FMCG industry is generally regarded by talent as a positive experience. Still, companies would benefit from providing ongoing learning opportunities to help the growth of talent and encourage career development.

Focusing on permanent roles and reducing outsourcing

Talent from the FMCG companies analyzed seem keen to develop a career within their respective employers, so a focus on permanent roles with room for growth and progression would be beneficial. Some of the FMCG companies had a higher volume of positive commentary than others in this area, with talent noting that the company is generally more open to new hires and has a higher prevalence of permanent roles, enabling new talent to develop their careers. Other FMCG companies should also prioritize roles that will allow talent to stay with the company long-term.

Conclusion

To conclude, although it seems that FMCG companies are still respected and seen by many as a desirable place to work, the issues which currently exist in FMCG are contributing to higher turnover rates as talent chooses to move to other industries. This can be addressed by aiming to improve the key areas of concern highlighted in this article: addressing the heightened bureaucracy, lack of communication, frequent turnover and restructuring, and limited long-term opportunities. However, it is important to acknowledge the strengths of the FMCG industry, with talent commending the Learning & Development opportunities provided. Subsequently, taking on the three suggestions; particularly upskilling and reskilling talent, will help enhance the employer attractiveness to existing FMCG talent due to the empowerment it will bring to talent.

By Lauren Arthur & Rumesha Wisidagama, Data Analysts at Link Humans. Learn more about what the Employer Brand Index can do for you.