From Insights to Impact: Understanding and Leveraging Employee Net Promoter Scores (eNPS)

By Taniya Shaikh On Jul 25, 2024

Employee Net Promoter Score (eNPS) is a metric derived from the Net Promoter Score (NPS) framework, traditionally used to measure customer loyalty. eNPS serves as an indicator of employee satisfaction and loyalty within an organisation. By gauging employees’ willingness to recommend their workplace to others, eNPS provides insights into the overall health of the company culture, employee engagement, and retention rates.

What is eNPS?

The eNPS is a simple yet powerful score used to measure employee sentiment. It is calculated based on employees’ responses to a single question: “On a scale from 0 to 10, how likely are you to recommend this company as a place to work?” Based on their responses, employees are categorised into three groups:

Promoters (9-10): Employees who are highly satisfied and likely to recommend the company.
Passives (7-8): Employees who are satisfied but not enthusiastic enough to be promoters.
Detractors (0-6): Employees who are dissatisfied and unlikely to recommend the company.

The eNPS is then calculated by subtracting the percentage of detractors from the percentage of promoters. The resulting score can range from -100 to +100.

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Origins and Evolution of NPS

The Net Promoter Score (NPS) was introduced by Fred Reichheld in his 2003 Harvard Business Review article, “The One Number You Need to Grow.” NPS quickly gained traction as a straightforward, effective tool for measuring customer loyalty and predicting business growth.

Seeing the success and simplicity of NPS in gauging customer loyalty, businesses and HR professionals adapted the concept to measure employee satisfaction, leading to the creation of eNPS.

Growth and Adoption

eNPS gained popularity as organisations recognized the value of having a similar, easy-to-understand metric for employee engagement. It offered a quick snapshot of employee sentiment and facilitated benchmarking across different departments and industries. As the business landscape evolved with a greater focus on employee experience and engagement, eNPS became a standard tool in the HR toolkit, used alongside other engagement and satisfaction surveys.

How is eNPS Measured?

Survey Distribution: Companies typically conduct eNPS surveys regularly, such as quarterly or biannually, to track changes over time. The survey is anonymous to encourage honest feedback.
Question Design: While the core question remains constant, companies can include additional questions to gather more detailed feedback. However, these supplementary questions do not influence the eNPS calculation.
Data Analysis: The responses are analysed to categorise employees into promoters, passives, and detractors. The final eNPS score is derived by applying the eNPS formula.
Actionable Insights: Companies use the eNPS results to identify strengths and areas for improvement in their workplace culture and employee experience.

Importance of eNPS

Employee Engagement: High eNPS scores are often indicative of strong employee engagement, which correlates with higher productivity and reduced turnover.
Attracting Talent: Companies with high eNPS scores are more likely to attract top talent, as they are perceived as great places to work.
Continuous Improvement: Regular eNPS surveys provide a continuous feedback loop, enabling companies to make data-driven decisions to enhance the employee experience.

SaaS Companies with Notable eNPS Scores

Several SaaS (Software as a Service) companies have distinguished themselves with impressive eNPS scores, showcasing their commitment to employee satisfaction and good workplace cultures.

1. Salesforce

Salesforce, a leading cloud-based software company, has consistently reported high eNPS scores. The company is renowned for its employee-centric culture, driven by its core values of trust, customer success, innovation, and equality. In an interview, Sarah Franklin, President and Chief Marketing Officer at Salesforce, mentioned, “Our employees are our greatest asset, and their feedback is invaluable. A high eNPS score reflects our commitment to creating an inclusive and supportive environment where everyone can thrive.”

2. Slack

Slack, now a part of Salesforce, also boasts impressive eNPS scores. Known for its flexible work culture and emphasis on employee well-being, Slack has created a workplace where employees feel valued and supported. Stewart Butterfield, Slack’s CEO, has emphasised the importance of listening to employees: “Maintaining a high eNPS score requires us to continuously engage with our employees and act on their feedback. It’s about creating a culture where everyone feels heard and empowered.”

3. HubSpot

HubSpot, a leading inbound marketing and sales platform, has garnered attention for its strong eNPS scores. The company’s commitment to transparency, flexibility, and employee growth has fostered a highly engaged workforce. Katie Burke, Chief People Officer at HubSpot, stated, “Our eNPS scores are a testament to the incredible culture our employees have built. We prioritise their well-being and growth, and it shows in their willingness to recommend HubSpot as a great place to work.”

4. Zendesk

Zendesk, a customer service software company, has earned high eNPS scores due to its focus on creating a positive and inclusive work environment. The company emphasises the importance of diversity, equity, and inclusion, which has resonated with its employees. In an interview, Mikkel Svane, CEO of Zendesk, stated, “Our commitment to fostering a diverse and inclusive workplace is reflected in our eNPS scores. We believe that when employees feel valued and included, they are more engaged and motivated to do their best work.”

5. Atlassian

Atlassian, known for its collaboration and productivity software, has also achieved impressive eNPS scores. The company’s focus on innovation, transparency, and employee development has created a highly engaged workforce. Scott Farquhar, co-founder and co-CEO of Atlassian, shared, “Our high eNPS scores are a direct result of our efforts to create a supportive and empowering work environment. We prioritise transparency and open communication, which helps build trust and loyalty among our employees.”

Shortcomings of eNPS

While eNPS is a valuable tool for measuring employee satisfaction and loyalty, it has its limitations that organisations should be aware of:

Simplicity: The single-question format of eNPS may not capture the full complexity of employee experiences and motivations.
Lack of Context: eNPS scores do not provide context for why employees feel a certain way, making it difficult to identify specific issues or strengths without additional qualitative data.
Misinterpretation Risk: eNPS scores can be misinterpreted without proper benchmarks, leading to inaccurate conclusions.
Focus on Extremes: eNPS focuses on promoters and detractors, potentially overlooking the sentiments of passive employees.
Survey Fatigue: Frequent eNPS surveys can lead to lower response rates and less reliable data due to survey fatigue.
Biases: Employee responses can be influenced by recent experiences, specific incidents, or cultural differences, potentially skewing the results.

Mitigating the Shortcomings

To address these shortcomings, organisations can:

Supplement with Additional Metrics: Use other engagement metrics and qualitative data alongside eNPS for a comprehensive understanding.
Contextual Analysis: Analyze eNPS scores with industry benchmarks, historical data, and qualitative feedback.
Regular Communication: Explain the purpose of eNPS surveys and share how feedback is used to drive improvements.
Balance Survey Frequency: Avoid over-surveying to prevent survey fatigue and ensure concise, relevant surveys.
Act on Feedback: Implement and communicate actions based on eNPS feedback to build trust and show employees their input is valued.

According to a survey by Culture Amp, companies with high eNPS scores tend to have 25% lower turnover rates and 31% higher productivity levels. Additionally, a Gallup study found that organisations with highly engaged employees outperform their peers by 147% in earnings per share.

The Employee Net Promoter Score (eNPS) is a crucial metric for understanding employee satisfaction and loyalty. By regularly measuring eNPS, companies can gain valuable insights into their workplace culture and make informed decisions to improve the employee experience. SaaS companies like Salesforce, Slack, and HubSpot exemplify the positive impact of high eNPS scores, demonstrating that a strong focus on employee engagement can lead to remarkable business outcomes. As the workplace continues to evolve, prioritising employee satisfaction through tools like eNPS will remain essential for attracting and retaining top talent and achieving sustained success.

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