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What Is eNPS? - Steps to Get a Good eNPS Score
BY QDegreesPUBLISHED
Apr. 15, 2024
Apr. 15, 2024
Employee Net Promoter Score is a metric to measure employee satisfaction and loyalty. It is inspired by Net Promoter Score, a globally recognized metric for measuring customer satisfaction and loyalty. eNPS has a very simple format, which is one of the reasons why it is so popular. It assesses the satisfaction of your staff by asking questions like "How likely are you to recommend us to your friends and family?"
But there’s a lot more to know about this metric, like how a good eNPS is scored, its significance, and how to calculate it. So, let's dive in to learn the answers to these questions with today's blog.
How to Calculate eNPS?
Employee net promoter score ranges between -100 to 100, which can be found with the help of a simple formula:
eNPS = % of promoters - % of detractors
Or it can also be written like this:
eNPS = [(promoters - detractors)/total number of employees] × 100
Now, let's take three situations and find their score to understand how the number of promoters and detractors affects it. But first, you should know who a promoter, passive, and detractor are.
As we discussed, it has a simple question to ask to which an employee can respond with a rating from the given rating scale that mostly has a range of 0-10. Here's the breakdown of ratings:
Promoters: The employees who rate 9 or 10 are considered company promoters.
Passives: The employees who respond with a 7 or 8 lie in the passives category.
Detractors: Now, those who are left are considered detractors, which are the employees who rate from 0 to 6.
Now, let's get back to the examples. Below is a table with the data of three companies and their respective eNPS scores. Let us analyze the data and their scores to understand the effect of promoters and detractors.
As you can see, the three companies have totally different scores. Company A has a positive score because it has more promoters than detractors, while Company C has a negative score because it has more detractors than promoters.
Moreover, Company B has a neutral score, which is not considered bad. The reason is that it has an equal number of promoters and detractors.
Another thing to notice here is that we have mentioned passives in the table, but their role in the calculation is not visible. Their role is indeed minimal, but since they are a part of the total employees, it ultimately affects the score.
Let's talk about the passives a little more. Remember we talked about open-ended questions? Open-ended questions play an important role in the problem identification of detractors. It is also important to attend to your passives, whom many companies overlook due to their least contribution to the employee NPS score. But even when their contribution is not significant in the formula, they can soon become detractors if their concerns are left unattended.
What's a Good Employee Net Promoter Score?
Generally, a good eNPS score lies between 10 and 30. Scores between 50 and 70 are said to be excellent, and if you get a score above 80, you are among the top companies, no matter which industry you are in.
However, the score benchmark differs from industry to industry. As per the reports, the overall average employee NPS, regardless of industry, is 12 to 14.
Moreover, if you go by industry, telecommunications has an average employee net promoter score benchmark of 27, IT has 26, and healthcare has a negative benchmark of -6.5. However, companies score higher, like many IT companies scoring 75 or more.
To understand what constitutes a good score, let's examine the reasons behind the eNPS scores of the companies we took as examples above.
To begin with, company A has a good eNPS score, and the reason behind it is obviously their increased number of promoters. But what has resulted in so many promoters? Based on the responses to the open-ended questions sent to the employees and the eNPS survey, the employees are happy with implementing the hybrid work mode.
Since many employees live far from the company office, it comes as a daily task to commute. When the company did the eNPS last time, they came to know about this problem and implemented the solution by introducing a hybrid work culture.
The company B, on the other hand, is a startup company. They have a neutral eNPS score, and the reason for this is that most of their detractor employees are finding that their salaries are not enough. However, their passives have the same concern, but they also think they are getting to learn new things, so it is an okay deal for them.
The company C, however, has a negative eNPS, and there are two reasons for this. Firstly, the company belongs to the banking sector, where negative scores are evident. However, employee dissatisfaction is also a reason behind the low score, as the workforce strength is lower than needed. That's why the employees are going through extra work tension.
What Is the Significance of a Good eNPS Score?
Till now, you know what the employee NPS is and how to increase it, but what about its benefits? Why is a good eNPS important, and does it really make a difference? Let's answer with some stats.
When you try to increase your eNPS, you make improvements that improve many factors, like employee engagement, wellness, and satisfaction. These factors have a great impact on a company's profitability and productivity.
According to an analysis by Gallup, companies with the highest employee engagement are around 21% more profitable than others. Moreover, productivity in such companies has also increased by 17%. But what do these stats mean to you?
By working on Employee NPS, a company also works on its culture, whether directly or indirectly. It affects the company's revenue, which can increase up to 4 times. In addition, a good score also signifies the presence of more promoters in the organisation, which positively affects employee retention and creates word-of-mouth referrals.
Key Takeaways
To sum up, here is what we have learnt from our today's blog:
Employee Net Promoter Score plays an important role in assessing employee satisfaction and loyalty.
It helps segment employees into promoters, passives and detractors to act accordingly on them.
A good score lies around 12-14. However, it depends on the industry which you are in.
You can find your score through this simple formula: eNPS = % of promoters - % of detractors.
Adopting a multidimensional strategy is important to improve your eNPS score, and it has great significance for employee engagement, productivity, and retention.
