Hello there, us again, with yet another exciting HR abbreviation to add to your growing collection! Meet eNPS – the latest hot ticket when it comes to retaining top talent (and human resource abbrevs). Yeah, we know it’s a little annoying, but your going to be glad you’re reading up on this one because it is a nifty new tool that you can use to measure employee engagement, reduce your turnover rate and keep your team all shiny, happy and amped to do their jobs to the best of their ability. Huge big WIN all around, amiright?
First things first – a definition of eNPS
‘eNPS’ stands for employee net promoter score. It is derived from sister abbreviation, NPS (net promoter score) that refers to a customer service tool that measures how likely your customer base is to refer your products or services to their family and friends. In this case, however, the scope flips inward to measure how likely your employees are to refer your place of work to job hunters and recruiters.
I.e. it’s a way to measure whether your crew sees your business as a beacon of employment joy, or a sinking ship that they may very well ditch at any second.
We’re sure you can see why this is a pretty big deal when it comes to retaining top talent. The best bit about the eNPS is that it comes with a formula, so you can put a number to your measurements. HR folks normally love this, since it makes things nice and quantifiable all around.
Let’s take a look at the formula, shall we?
The eNPS formula
The formula: (Number of Promoters — Number of Detractors) / (Number of Respondents) x 100
Essentially, you’re asking each of your employees to rate how likely they are to recommend your company to other job seekers on a scale of 1 – 10. This data will then shuffle your employee corps into three categories:
- Those who answered 9 to 10. These are your promoters – satisfied employees who sing your praises wherever they go.
- Those who answered 7 to 8. These folks are neutral – they’re passive, which means they won’t badmouth your business, but they’re not exactly throwing streamers and glitter either.
- Those who answered 0 to 6. Eek, these are the detractors – they are pretty unhappy at the moment and not likely to be a good ambassador for your company at all.
E.g. If your company has 100 employees of which 50 are promoters, 25 are neutral and 25 are detractors, your sum would be:
(50 — 25) / (100) x 100 = giving you an eNPS score of 25.
Top Tip: Don’t care to do the math yourself? No sweat – here’s a FREE online eNPS calculator you can use. You’re welcome – ain’t the internet grand?
How to interpret eNPS formula results
The thing to remember about your eNSP score is that it is not a pass or fail grade – it’s a little like taking the vitals of a patient during a checkup; you’re checking to see if everything is on par, and noting it down to use as a benchmark in future. Your aim should be to improve your score every time you check in with your team.
At this point, you could perhaps be wondering whether the juice is worth the squeeze. We’re here to tell you, yes, knowing your eNSP rating is absolutely 100% worth the bit of squeezing you’ll need to do to get the data. That’s because not knowing will cost you in the long run, and not only in terms of retaining top talent, but also in terms of your very tangible bottom line.
Why your company should definitely improve its eNPS score
The biggest, most important reason? High employee turnover costs your business a boatload of money. Real, actual Randellas that you could have been using to increase salaries (great for retaining top talent), spruce up your office or hire more employees to take the pressure of your existing team. This is because every time you lose an employee, you have to:
- Advertise the position on job boards, perhaps get a recruiter on board, and set aside the time to interview likely candidates.
- Train a new employee, which results in a loss of working time for the trainer.
- Be cool with an initial loss of productivity as a new employee settles in.
- Deal with the potential costs of mistakes your newbie might make while they’re learning the ropes.
- Subject returning clients to the hassle of having to reconnect with a new contact (possibly leading to a loss of that client).
You can read more here: Avoid the churn and get great business results.
Lovely stuff, there you have it all tied up in a neat little bow: a definition of eNSP, the eNSP formula, a handy online calculator, and a few reasons why you should bother with this exciting high turnover buster. Done and dusted!
If you like this type of straight-to-the-point resources and business tools, keep your eye on our blog.
We also invite you to take a look at our SaaS-based employee recognition platform that has been tailored to help businesses retain top talent and keep employee engagement top of mind. Just because we’re feeling generous, we’ll even let you take it for a spin completely FREE of charge. Simply click the button below to get started.
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