5 Easy Steps to Calculate Employee Net Promoter Score (eNPS)

Engaged employees are more productive, satisfied, and likely to stay with the company. Even teams with a more engaged workforce outperformed their colleagues: Business units with the highest employee engagement showed a 21% increase in profitability compared to units in the lowest quartile. It doesn’t end there: Engaged employees are more likely to help you hire referrals. 

But how do you measure engagement effectively? More specifically, how do you measure how employees feel about your company? One valuable tool is the Employee Net Promoter Score (eNPS), a metric drawn from the Net Promoter Score (NPS) concept, originally developed to assess customer loyalty. Let's look at this metric more closely.

What is Employee Net Promoter Score (eNPS)? Hint: It’s Based on a Single Question

The Employee Net Promoter Score (eNPS) is a metric that assesses employee loyalty and satisfaction with their workplace.  As we said, it's modeled after the Net Promoter Score (NPS) concept, originally developed to assess customer loyalty (it got so pervasive that it’s been used by both B2C and B2B companies). Both eNPS and NPS rely on a single core question: “On a scale of 1–10, How likely are you to recommend The Company–The Workplace to a friend or colleague?”

Yes, you got it right—it’s a straightforward question.

The eNPS calculation applies this question specifically to employees. Their responses are then broken down to measure the overall eNPS calculation. If the score is high, employees will recommend your company to colleagues. A high eNPS score will probably be correlated to other favorable ratings, like a high retention percentage.

Why is eNPS Calculation Important?

As an HR consultant, you can think of your employees as your customers, and your potential hires as your prospects. And if you want your customers to bring in new top talent by referral, the eNPS is the best measure to understand how well you’re doing that. Hiring by referral is cheaper and more effective than most methods—certain sources point out it has a 40% conversion rate.

Here are some key benefits from evaluating your company’s eNPS calculation:

• Measure employee sentiment: The eNPS calculation provides a quick and efficient way to evaluate overall employee sense of well-being. Unlike lengthy surveys, the single core question allows you to gather a snapshot of employee satisfaction and loyalty in a blink of an eye.
• Identify areas for improvement: A low eNPS score indicates potential issues with employee engagement. By figuring out that your employees are having problems, you can then start to investigate where those problems are happening.
• Increase employee retention: Engaged employees are more likely to be satisfied and stay with your company. By doing eNPS calculations regularly, you can see how employees feel and take action to address problems. This can help reduce turnover and the costs that come with it.
• Benchmark: Use eNPS calculation to compare your company's employee engagement to other companies in the same industry. This can help you figure out where you're good or where you need to improve.

What are the Limitations of an eNPS Score?

While eNPS calculation presents numerous advantages, it also has its limitations.

The simplicity of the metric may downplay important aspects of employee attitudes, which would require more qualitative surveys to look deeper into the issues. Plus, eNPS calculation alone cannot lead to improvements in employee engagement. This only tells organizations to look into the problem more closely and make specific changes. HR teams with a good understanding of their workforce—even using people analytics or employee performance tools—will have an easier time designing these changes.

Why It’s a Good Idea To Break up the eNPS by Business Units

Considering you have people analytics where you can break down your workforce by demographics or responsibilities, you should try to obtain plenty of eNPS scores, not just one per employee or one per company. If you get scores in between—like the score for a Sales team—you’ll understand how a certain team is feeling.

How to Calculate eNPS? 5 Steps to Figuring Out your eNPS

Now, how to calculate Employee Net Promoter Score? After you ask the question, the formula for eNPS calculation is quite simple:

Employee Net Promoter Score =  % Promoters - % Detractors

However, the hole process might be just a little more complex. Let’s see how to measure eNPS in 5 simple steps:

1. eNPS Survey Preparation

Craft the question: Craft the core question for your eNPS survey. A typical example is: “How likely are you (on a scale of 0 to 10) to recommend [Your Company] as a great place to work?”

Consider optional elements: While the core question is essential, you may also choose to include an open-ended section for employees to elaborate on their responses. This can provide valuable information into the reasons behind their scores. It’s a great follow-up for a watercooler talk, but that way it wouldn’t be anonymous.

2. eNPS Survey Distribution

Choose a platform: Select a method for distributing your eNPS survey. Popular options include online survey tools or integrating it into your HR system.

Ensure anonymity: Guarantee the anonymity of employee responses. This will encourage honest feedback and provide the most accurate results.

3. Collecting Responses

Promote participation: Encourage high participation rates by clearly communicating the purpose of the survey and the importance of employee feedback.

Set a timeline: Establish a timeframe for completing the survey. This helps you gather responses efficiently and analyze the data of the eNPS calculation right away.

4. eNPS Formula

Once you have collected the responses, it's time to obtain your eNPS calculation number through the eNPS formula: eNPS = % Promoters - % Detractors.

5. Categorizing Responses

Promoters (9-10): These are your enthusiastic advocates. They're highly engaged and likely to recommend your company to others.

Passives (7-8): These employees are somewhat satisfied, but not necessarily enthusiastic. They might not readily recommend your company, but they're unlikely to actively discourage others from joining either.

Detractors (0-6): These employees are unhappy or disengaged and may actively discourage others from working at your company.

💡Note: Passive scores (7-8) are not factored into the final eNPS calculation.

What to Do After Calculating eNPS

The eNPS calculation is just the first step. To receive real value from this metric, you need to take action based on your results. Here's what to do next:

1. Action Planning

Analyze the results. Don't just look at the overall score. Dig deeper into the data. Are there specific departments or teams with lower scores? What reasons did detractors give for their low ratings? Identifying these areas for improvement allows you to develop targeted strategies. 

Also, develop a plan: Based on your analysis, create a concrete action plan to address identified issues. This could involve implementing new programs, improving communication channels, or addressing specific concerns raised by employees.

2. Resurveying / Recalculating eNPS

You need to track progress. Don't send out a one-off eNPS survey. Regularly carry out your eNPS calculation over time to track the impact of your actions. Resurveying employees every quarter or biannually allows you to monitor progress and identify if adjustments are needed to your strategies.

3. Consider Alternatives to an eNPS Survey

If you pay attention to your workforce, you might realize some employees don’t feel comfortable answering the 1–10 question. But perhaps, that reticent employee has to say something very impactful for your company, and they need a channel to do that. You should always provide your employees with a transparent and private way to expand on their concerns.

Final Thoughts on eNPS Calculation

The eNPS calculation is a handy method for understanding employee sentiment and loyalty. By checking your eNPS calculation and taking action based on the results, you can:

Increase Employee Engagement

By addressing employee concerns and implementing strategies to create a more positive work environment, you can build a more engaged workforce. This means increased revenue and more referrals knocking your door.

Lower Employee Turnover

Engaged employees are more likely to stay with your company, reducing the costs associated with recruiting and training new hires.

Improve your Employer Brand

High eNPS scores can help improve your company's reputation as a great place to work, attracting top talent in a competitive job market.

Remember, eNPS calculation is just one piece of the puzzle. Combine it with other strategies like open communication and employee feedback sessions to gain a comprehensive understanding of your workforce and create a healthy workplace culture.

For an even more effective approach, consider implementing a software solution like TalentHR. TalentHR is a comprehensive all-in-one platform that allows HR professionals to manage people and simplify tasks like time-off management, performance management, hiring, and onboarding. The platform also allows performance reviews to be run by managers and individual employees using transparent online forms.

Register now for free.

To learn more about people analytics solutions for HR Teams and business professionals, visit TalentHR.