Employee NPS guide

What is an employee NPS

The employee Net Promoter Score (eNPS) is a popular method used by employers to measure employee engagement. It’s a variant of the consumer Net Promoter Score. The difference is straightforward: whereas NPS is traditionally used to gauge how likely a consumer is to recommend a service or product, eNPS adapts the method in order to evaluate the likelihood that employee will recommend their workplace to others as a good place to work.

How does it work?

Most typically, the eNPS score is calculated based on employee responses to a single question: on a scale of 0-10 how likely it is that they would recommend their place of work as a good place to work?

Depending on where they place themselves on the scale, the employee is designated as a Promoter, a Detractor or a Passive. Those who respond with a score of 9-10 are Promoters. Those who respond with a score of 0-6 are Detractors. Those who respond with a score of 7-8 are Passives (that is, they are not likely to actively promote or detract).

The overall eNPS score is calculated by subtracting the percentage of employees who are Detractors from the percentage of employees who are Promoters. Passive employees count towards the total number of respondents. They lower the overall percentage of Promoters and Detractors and push the net score towards zero.

Because it works on a percentage scale, an eNPS score can be as high as 100 (where every employee is a Promoter) and as low as -100 (where every employee is a Detractor). Realistically, a score higher than zero is considered to be good, while a score above 50 is excellent.

Can you measure engagement with eNPS?

The benefits of engaged employees are well researched and documented. A culture of engagement is proven to give businesses a competitive advantage. It reduces absenteeism and costly employee turnover. It can help increase innovation. And it boosts the bottom line.

Of course, the first step to improving employee engagement is to measure how you’re performing now. The eNPS method and the data it collects is relatively basic, but because the method is so simple—relying only on the answer to a single question for its results—it can be an attractive starting point towards measuring employee engagement.

The limitations of eNPS

Although eNPS is undoubtedly useful, it is not without limitations. It’s great at measuring how likely employees are to recommend your company as a place to work. It doesn't tell you much else.

While some companies use eNPS scores as shorthand for employee engagement generally, doing so doesn’t provide a clear view of the full, nuanced engagement landscape.

For example, it is possible for an employee to be a Promoter in the eNPS sense without being meaningfully engaged at work. Consider the diverse reasons why an employee may recommend a place to work: Perhaps their company provides excellent remuneration. Perhaps it provides a high degree of stability. Perhaps it allows flexible hours that suits the employee’s lifestyle outside of work.

These criteria certainly reflect positively on an employer and they may justify a recommendation on their own. However, an employee that makes a recommendation based on these criteria may not feel as positively about other aspects of their work life. After all, being well remunerated or enjoying flexible hours is not the same as being motivated at work, feeling a strong commitment to the company’s future, having development opportunities or being meaningfully engaged as an individual.

Without asking other questions, there’s no way to gauge these other engagement indicators using eNPS alone.

Going deeper

eNPS is great as a recommendation measurement tool. And it can be a useful start to measuring employee engagement.

But, if you want to measure beyond recommendations and dig deeper into the details of engagement, there are other options you might like to consider.

Specially designed employee engagement tools, including Culture Amp’s own multiple question Engagement Index, ask a few more questions in order to provide a more robust understanding of how your workplace is viewed by employees.

Recommendation measures, such as those provided by eNPS remain an important component of these tools, but they are one of many rather than being the sole focus. By using a multi-question index, your company can additionally measure:

Choosing the right tool for your organization

Ultimately, when it comes to measuring employee engagement in a way that works for your organization, it’s all about selecting the right tool for the job. Consider what you are trying to achieve and your means for achieving it.

If your company is after a recommendation measure alone, or is limited to asking employees a single question, then eNPS can be a good fit.

If you want a more nuanced understanding of your employee engagement levels so that you can take meaningful action, a multiple question index will be a better fit.

To learn more about eNPS, check out this article by Culture Amp’s Chief Scientist, Jason McPherson.

Culture Amp helps organizations understand and improve employee engagement and recommendation. Talk to one of our People Geeks today about the next steps for your organization.

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