Even before organizational psychologist William Kahn examined what it means to be motivated at work in 1990, academics have attempted to define and redefine the exact meaning of “employee engagement”.
As research continues to shape our understanding of how engagement impacts our motivation and performance at work, the most important thing is how we measure and quantify employee engagement.
Employee engagement can be measured in different ways. At Peakon, a Workday company, we believe that this process starts with regular employee feedback. Based on academic research and the latest data science, we’ve developed a framework for accurately measuring the many factors of an employee’s experience at work that can impact their engagement.
Based on 14 engagement drivers that outline the key psychological requirements for human motivation at work, Peakon gives you the tools to improve employee engagement via regular employee surveys, real-time insights, bespoke manager training, and collaborative action planning.
Our platform surfaces insights to help you better understand your employee engagement, the experience of your organization, and your company culture, so that you can drive measurable improvements that support your strategic objectives.
“Net Promoter Score has been around for a while, and eNPS has rapidly become the go-to measurement for determining levels of employee engagement. This is live, real-time feedback and it’s great for understanding what’s going on and being able to take relevant action quickly.”Daniel Kasmir, Chief People Officer, Talk Talk
Measuring employee engagement starts with one key question
Over the past decade, companies have been focused on delivering great experiences for their customers. It makes sense — after all, happy customers are loyal ones, and are more likely to refer your brand to their friends.
However, understanding what drives customer satisfaction and measuring that impact is an important part of this process — which is exactly why the Net Promoter Score metric was developed.
Created by US management consultancy Bain & Company in 2003, NPS is the gold standard for gauging how well the brand is engaging with its customers. It functions by asking customers a single question on a 0-10 scale:
“How likely is it you would recommend [product/service] to a friend or colleague?”NPS question
This method of measuring customer satisfaction works because it’s simple, intuitive, and correlates directly with company revenue.
As organizations have begun to realize that engaging their workforce should be a fundamental part of their business strategy, however, their attention has shifted to building great employee experiences. Rather than part of your portfolio, employees should be thought of as internal customers within your organization.
Building a great employee experience is the key to engaging your people, as well as keeping them at your company for longer, and creating advocates for your brand. In that way, a positive employee experience leads to a positive customer experience, too.
This inextricable link between customer and employee experience makes the NPS methodology particularly fitting for measuring engagement. The Employee Net Promoter Score, or eNPS, was adapted from NPS to measure employee engagement — and it works in exactly the same way as its customer-focussed counterpart.
In Peakon, we use this eNPS framework to ask one initial engagement question:
How likely is it you would recommend [Company Name] as a place to work?eNPS question
This question is designed to encourage employees to consider the many different factors that have an impact on engagement — such as their working environment, potential for growth, and their organization’s culture — and apply how they feel to a single question.
Building a comprehensive view of employee engagement
Just as you wouldn’t only ask one question to a prospective employee in an interview, we don’t just ask one question to gauge engagement.
We also ask three further questions to measure the different outcomes of engagement: loyalty to your organization, your satisfaction working at your company, and your belief in your company’s products and services:
If you were offered the same job at another organization, how likely is it that you would stay with [Company Name]?Loyalty outcome question
Overall, how satisfied are you working for [Company Name]?Satisfaction outcome question
How likely is it you would recommend [Company Name] products or services to friends and family?Belief outcome question
Together with the main engagement question, these three other factors combine to provide one aggregated employee engagement score.
Peakon provides insights using two complementary scales
We gather responses to our engagement and driver questions on an 11-point scale ranging from 0 to 10. We chose this scale because it’s simple, intuitive, and consistent. Survey respondents find it easy to understand at a glance that 0 indicates a low score and 10 is a high score.
Research has shown that an 11-point scale offers a more granular, varied data set than the commonly-used 5-point Likert scale (Leung, 2011). Measuring on a more sensitive scale means that your employees can select an answer that more closely aligns with their own experiences.
It also means that you can track the small changes that would not otherwise be visible, allowing managers to see the impact of any actions they’re making to improve their team’s engagement. You can track the improvement from a score of 8 to 9 on a 0-10 scale, but you would be less likely to see these changes on a five-point one.
Seeing the small changes in your team’s engagement allows you to act on those insights and make changes.
“eNPS has become part of the language at Capgemini. When you see an engagement score in its raw sense, it seems positive. But eNPS allows us to look behind the high score to see the detail in it. I might be comfortable knowing 75% of our population feels supported, but what about the one in four who don’t?”Anouska Ramsay, Former Vice President of Group Talent, Capgemini
Peakon gives you two ways to view your engagement scores on the dashboard: your average score on a 0-10 scale, or using the NPS scale, which ranges from -100 to 100. Both of these methods have their own distinct advantages.
The first way of looking at your engagement is using the average score. It is an intuitive, simple-to-understand scale that gives you a steady and consistent measure of your teams’ engagement. For a quick overview, this average is perfect.
You also have the option to view your engagement score using the NPS methodology. This is built on the same framework used to measure customer satisfaction, and can give you a bit more detail on your engagement beyond your average score. Not only that, but it directly correlates your employee engagement with customer satisfaction metrics.
Employee responses to the engagement questions are divided into three groups:
- Detractors (scores from 0 to 6)
- Passives (scores from 7 to 8)
- Promoters (scores from 9 to 10)
‘Detractors’ represent your employees that are either unhappy or need more support. Meanwhile, ‘Passives’, though not disengaged, may have some concerns that are holding them back from realizing their full potential at work. By contrast, ‘Promoters’ are motivated, work with energy and enthusiasm, and bring their full selves to work.
Then, your overall score is calculated by subtracting the percentage of detractors from the percentage of promoters, giving you a score between -100 and 100. This makes the NPS scale even more sensitive than the 0-10 average score view. When an employee’s response changes from detractor to passive, or passive to promoter, you’ll see the positive changes reflected in your score.
To see how these two scales complement each other in practice, let’s imagine the following scenario:
Your most recent survey round has closed, and your team of 20 employees has an average engagement score of 7.5/10. On the surface, that looks really good. However, when you look at your NPS score, it’s 0 — and your NPS breakdown tells you that half of your team are promoters, and half are detractors.
This means that half of your team is extremely engaged, scoring from 9 or 10/10, while the other half is disengaged, scoring between 5 or 6/10. For leaders, this is a significant issue.
Fifty percent of your employees could be at risk of leaving your organization — something which you would not have been aware of without the ability to view your engagement using different scales. When you have the whole picture of your employees’ engagement, you can be more proactive and course-correct to reduce churn, strengthen loyalty, and drive a high-performance culture.
In this Total Economic Impact™ Study conducted by Forrester Consulting on behalf of Peakon, Forrester Consulting estimated Peakon clients achieved a 244% return on investment.
Peakon scores are a proven indicator of business performance
In addition to measuring employee engagement, we also measure the outcomes of that engagement. Building an understanding of your company’s engagement and the key factors that impact it will mean you can make real changes that drive your business outcomes in a tangible way.
In this Total Economic Impact™ Study conducted by Forrester Consulting on behalf of Peakon, Forrester Consulting estimated Peakon clients achieved a 244% return on investment. With that in mind, let’s look at how such returns relate to other key business metrics.
When your employees are engaged, they’re more likely to go the extra mile to deliver an exceptional experience for your customers — and happy customers spend more with your brand. That’s how higher employee engagement not only leads to higher customer satisfaction, but higher revenue.
One of the clearest upshots of a more engaged workforce is a reduction in employee absenteeism. The Total Economic Impact™ Study conducted by Forrester Consulting on behalf of Peakon estimated that, after 3 years with Peakon, average employee absenteeism declined by two days. The impact of that adjustment across a whole workforce is potentially massive.
Engaged employees are more likely to stay with your organization than disengaged ones, a fact we can measure with our Engagement and Loyalty outcome questions. The Total Economic Impact™ Study conducted by Forrester Consulting on behalf of Peakon estimated that, after 3 years with Peakon, voluntary staff turnover was reduced by 10%.
Peakon helps you take action on your engagement scores
Measuring engagement is an important step to achieving your strategic objectives. However, in order to drive improvements based on that insight, you also need to understand what’s impacting your scores. This is why, in addition to choosing a score between 0 and 10 on the Peakon platform, employees have the option to enter a text comment to accompany their score when answering a question.
Employee comments provide a rich source of insight and add further context to quantitative survey responses. Peakon’s Topics feature uses Natural Linguistic Processing (NLP) — a form of machine learning — to surface the most common themes and issues that matter to the people in your organisation.
Personalized insights are delivered to every leader, so you can drive positive change from the bottom up, and help your managers take the actions necessary to improve engagement in their teams.