Employee Net Promoter Scores & Employee Engagement

Since it was launched in 2003, the Net Promoter Score (NPS) has been a sensation in consumer research. As a metric based on a single question, some have claimed it to be an ultimate indicator, although doubts have been raised about its efficacy. Still, in 2016, more than two thirds of the USA’s fortune 1000 companies use it.

The Employee Net Promoter Score (eNPS) is a variant of the basic NPS, said to evaluate employee engagement. It asks only one question to gauge whether employees would recommend their place of work as a good place to work. Many companies now rely on it as a primary metric for their employee research.

But, is the simplicity of a single-question metric worthwhile? Is it good business to rely on these single-question methods?

It sure is easy

Simplicity is great and a single question only takes a second.

What’s more, a well thought-out question can reveal a good deal of information. In fact, Culture Amp asks a similar question in our Engagement Index. We call it a recommend item. 

So sure, we endorse the use of well-crafted questions like these. We just don't recommend it as the only question to ask.

Is it the ultimate?

Studies have shown that other single-item measures might be just as good as the NPS method. In some cases, similar tools may actually produce better results. [DL1] 

In general, statisticians (i.e. the people who know) agree that well-constructed multiple-item indicators are more reliable and tend to provide better external validity than single-question metrics. There are many employee engagement indexes that do just that.

Testing eNPS and engagement

We're always keen to test things out using our own data. So, we decided to test an eNPS-type score against a multi-item indicator—Culture Amp’s Engagement Index.

Using data from a sample of 15 companies, we applied the two different methods of calculation. The Engagement Index was calculated according to Culture Amp’s standard comprehensive procedure. For the eNPS-type score, we applied the NPS calculation methodology to the responses we got to our singular recommend item, as mentioned above.[DL2] 

You can see below, the two scores were quite strongly correlated, at greater than 0.90.

Company-level Engagement Index (y axis) versus eNPS scores (x axis). Company-level Engagement Index (y axis) versus eNPS scores (x axis).

A glance at the data reveals two things. First, these metrics are related. Second, some companies deviate significantly from the straight line. This indicates that eNPS and the Engagement index are probably reporting slightly different information.

How useable information differs

On average, eNPS scores seem to be strongly related to the other things Culture Amp asks for in its Engagement Index. The connection of eNPS with pride, motivation and commitment is evident, but it is not strict. For some organizations, the results obtained by using each method were significantly different.

Some of the organizations rank more highly on an eNPS metric than they do if they use the more comprehensive engagement metric. At the employee level, this may mean that some employees are prepared to recommend their company even though they lack motivation or do not feel engaged as an individual.

The only way to detect these irregularities is to ask more than one question.

How much information do I really need?

You don’t want reams of reports. You just need to make sure that the information you rely on accurately reflects the reality of your situation.

If your organization is one of those that strictly adheres to the correlation, that’s great. If it’s one of the one that deviates, you’re probably going to want extra info to be sure you know what you’re dealing with. How would you know whether your company adheres? Put simply, the only way to know is to ask more questions.

What about those who use the single-question metric? 

Many of the organizations that rely on the eNPS seem to be tracking fine. They work with their employees to maintain their scores. I think this stands testament to the fundamental importance of measuring simply and regularly and checking in with employees.

The fact that eNPS seems okay most of the time does not mean that it is the ultimate question. It just shows that doing something about engagement is definitely worthwhile. Of course, doing something is a great start. Doing it better is the way to amplify your positive outcomes.

So, what should you do? 

The simplicity of a single-question metric certainly has its appeal. If you are limited to asking just one question, an eNPS score might be a great question to ask. However, for some purposes there are others questions that might be better. In most situations, asking more than one question will increase accuracy.

Simplicity really is great, but so too is accurate and reliable information: your business deserves it. While one question only takes a second, a couple of extra questions only take a few more seconds.

If your employees can spare a minute or two, ask two or three other types of engagement questions as well. It’s easy and efficient and it will give you a broader and more statistically reliable metric.

About Culture Amp

We've brought together experts in technology, data science and organizational psychology to ensure you can get the clarity you need, when you need it. Measuring employee engagement, experience and 360° feedback is simple using Culture Amp.

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