Net Promoter Score (NPS) and the Employer Brand

imageOne of the most difficult aspects of employer brand measurement is identifying data points that can be directly correlated to the strength of your employer brand. Most importantly, it’s critical to capture both qualitative and quantitative data.

In addition, it takes careful wording and thoughtful consideration to ensure you are eliciting responses that are illustrative of your employer brand versus your employee value proposition (EVP). For example, in a recent employer brand survey, one of the questions asked was “what are the reasons you feel [the company] is a great place to work?” While we were looking for responses on whether the employer brand messaging / visuals were resonating with candidates and employees, we ended up with responses such as “the benefits are great” or “I like the work / life balance” which speak more to EVP attributes.

So how do you elicit authentic responses, while also receiving numerical, actionable data? Enter the idea of using the Net Promoter Score.

In a previous blog post I wrote about ways to measure your employer brand, where I mentioned the Net Promoter Score (NPS). If you’re not familiar with NPS it may be because you’re not in a B2C or service-related industry. I’ve only recently learned more about it within the past few years myself. Many companies use NPS to measure customer and user satisfaction for quite some time and are just now starting to see how this score can be used to measure candidate or employee satisfaction.

What is NPS?

NPS is a “word of mouth” marketing metric used by many companies to measure brand health in terms of customer satisfaction. Companies also like NPS because of its simplicity — it’s well understood and likely to be interpreted in the same way by everyone who responds which is  key to establishing a benchmark and seeing how you stack up against your competitors. (Source: Quora)

Your NPS is calculated by asking your customers a single question, using a 0-10 scale: How likely is it that you would recommend [brand] to a friend or colleague?

The higher your NPS is over that of your competitors, the more likelihood you will outperform in your market or industry, and managing your organization to improve NPS will also improve your business performance. (Source: NetPromoter)

Can NPS be used by HR?

There’s a lot of conversation right now on whether HR can use a NPS to measure and evaluate human capital. NPS is an extremely difficult metric for analyzing your people and it doesn’t necessarily give you insight into your employee value chain. In fact, I was just reading a great post by Mike West who leads People Analytics at Pure Storage. He walks you through the origination of NPS and then discusses the application of it within HR. He also provides some compelling arguments as to why NPS may not be the most suitable metric for HR and introduces a new value called Net Activation Score (NAV).

However, while NPS may not work for HR / people analytics, there is value in using it to measure the strength of your employer brand in the same way you use it to measure your consumer brand.

How NPS fits in with Employer Brand

Even though its original intention is to measure customer satisfaction, the NPS can also be used to measure candidate and employee satisfaction.

Following the sentiment of what is asked of customers, the question you would ask is:

“On a scale of zero to ten, how likely is it you would recommend this company as a place to work?”

Respondents who score 9 or 10 are called ‘Promoters’. Those who score 7 or 8 are ‘Passives’ while any respondents who gives a score of 6 or below is a ‘Detractor’.

The actual calculation is: % of Promoters minus % of Detractors.

Passives aren’t included in the calculation because they’re neutral and could go either way. (Source: Officevibe)

Your score will be on a scale of -100 to +100. (Companies often miscalculate by subtracting the number of promoters from the number of detractors or by just averaging out the responses. Don’t fall into either of those traps).

Using NPS to measure Candidate and Employee Satisfaction

Employee satisfaction is something often lumped in with employee engagement. However, satisfaction and engagement are not the same thing. One is more functional and the other is more emotional. While both can influence how an employee would rate a company, satisfaction can be a quantitative data point for the employer brand.

With this in mind, consider placing the NPS question in both your candidate and employee surveys, segmenting the NPS into the Candidate Net Promoter Score (cNPS) and the Employee Net Promoter Score (eNPS). The cNPS is a valuable data point for better understanding the external perceptions of prospective employees during the recruiting process whereas the eNPS is a powerful internal metric that allows you to understand the overall level of satisfaction of employees and the drivers of that satisfaction when using the standard NPS follow-up question: “What could we do to get you to rate us as a 10?”.

If you’re looking for the best way to measure employee satisfaction, then NPS may just be the data point you’ve been looking for.

Understanding your eNPS

The numerical eNPS is straightforward in its meaning. If your eNPS is negative, your employees on average are detractive. A negative eNPS likely means you’ve got serious employee engagement problems, as the score is negative.

If your eNPS is positive, your workforce is promotive. The higher the score, the more likely your employee base it to encourage their friends to join the company, and to feel fully committed to the company and fulfilled by their work.

A word of caution: If you’re familiar with NPS scores regularly seen for customer surveys, your eNPS results may surprise you. Employees are likely to be harsher in an eNPS survey than they would be in a customer NPS survey, and for good reason. On average, they invest far more time and emotional energy in their relationship with work than they do with the products they buy. Keep that in mind as you calculate your eNPS. (Source: HR.com)

What is a good NPS?

What is considered a good net promoter score can vary by industry, but a score of 50 to 80 is typically considered “good.” (Source: Help.com) In the insurance industry, we aim for a score of 80+ which is considered excellent. However, I highly recommend that you establish a benchmark in relation to your industry and your competitors and then use that benchmark to track your progress year over year.

In all, the NPS for employer brand (cNPS and eNPS) is a really simplistic tool that will tell you so many things about what’s working and what’s not. It will help you gain a high-level understanding of both the external and internal perceptions and reputation of your company, and give you a numerical value to equate to candidate and employee satisfaction — and ultimately the overall strength of your employer brand.

Elizabeth

Elizabeth is a strategic communications leader with nearly 20 years experience in both internal and external communications. She is a passionate advocate for developing communications that foster a stronger relationship between the organization and its employees. She is a global keynote speaker on employee engagement and HR communications. Elizabeth is a certified professional in Employer Brand through Universum Global's Employer Branding Academy.

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