Would Your Employees Recommend Your Company To Friends?
On a scale of zero to 10, how likely is it that you would recommend your company to a friend as a place of work? That simple query to employees is shaking up the way executives manage human capital.
Today, most companies struggle to interpret traditional employee satisfaction questionnaires as a driver of business performance. But those indicate only vague feelings rather than the more telling action of praising a company to a friend — and they don’t really track with impact on business performance. As a result, such surveys often get the brush-off by employees who see them as a “hobby” of the HR department or corporate leadership.
With rhetoric like that, it’s no wonder that the Arcus Employee Motivator Score (EMS) methodology is becoming a popular and powerful way to measure employee satisfaction, loyalty and business performance.
Today, most leading companies use the Net Promoter score to measure their business performance. The Net Promoter is a customer loyalty metric introduced by Fred Reichheld in his 2003 Harvard Business Review article “The One Number You Need to Grow”. Companies obtain their Net Promoter Score by asking customers a single question on a 0 to 10 rating scale: “How likely is it that you would recommend our company to a friend or colleague?”
The Net Promoter Score
The Net Promoter Score is discussed at length in “Answering the Ultimate Question” by Richard Owen and Laura Brooks. It has been adopted by a large number of large companies, including Philips, GE, Allianz, P&G, Intuit and American Express. Clearly, it’s attractive to have something simple.
Arcus has applied the concept of the Net Promoter Score approach to employee management by asking “How likely is it that you would recommend your company to a friend as a place of work?”
Arcus Employee Motivator Score
The Arcus Employee Motivator Score helps an organization to measure employee trust and become more focused on improving employee satisfaction which in turn increases customer satisfaction and business performance. Hence, the motivator score correlates directly with revenue growth. Arcus has a benchmark of over 500 companies to enable HR executives and Management compare their EMS scores with other companies and industries.
By asking employees whether they would put their own credibility on the line by recommending a company to a friend, employee motivator scores are truer indicators of loyalty and future behavior and, therefore, sales growth. The score can be highly effective if bonuses of managers are tied to employee motivator scores.
One client has found that higher employee motivator scores have already been linked to a greater likelihood that the company will win new contracts from existing clients. Ultimately, it’s not about the score, it’s about focusing employees on the customer.
The Employee Motivator Score methodology can reduce the complexity of implementation and analysis frequently associated with measures of employee satisfaction, providing a stable measure of business performance that can be compared across business units and even across industries, and increasing interpretability of changes in employee satisfaction trends over time. Based on their responses, employees can be categorized into one of three groups: Motivators (9-10 rating), Indifferent (7-8 rating), and Doubters (0-6 rating). The percentage of Indifferent is then subtracted from the percentage of Motivators to obtain an Employee Motivator Score.
An EMS score of 75% or above is considered quite high. Companies are encouraged to follow this question with an open-ended request for elaboration, soliciting the reasons for the ratings. The EMS is then correlated with customer’s rating of that company or its products. These reasons can then be provided to HR executives, business managers, Front-line employees and management teams for follow-up action.
Arcus has found that companies with high net employee motivator scores show the highest revenue growth. The approach is gathering steam at a time when CEOs are increasingly focused on getting closer to employees and customers. It also plays into the executive lament that employee management programs, which track employee retention, are among the most ineffective tactics in their toolbox. Pair that with mounting recognition of the power of word of mouth and social networks, and it’s easy to see why buzz is building.
The most important benefits of this methodology are derived from simplifying and communicating the objective of creating more “Motivators” and fewer “Doubters” — a concept that is far simpler for executives to understand and act on than more complicated, obscure or hard-to-understand employee satisfaction metrics or indices.
Companies are discovering a need to simplify a complex satisfaction tracking process to make a company’s business strategies match up more closely with Employee Motivator Scores. One effect of the new approach is that companies are spending more time listening to motivators and Doubters.
For example, at one company, managers following up with unhappy customers found that a chief complaint was slow response times from knowledgeable support staff. So the division is overhauling its operations and putting more staff in the field; now Employee Motivator Scores are jumping by 15 to 20 points.
Please visit Arcus Innovation Leaders Series for additional insights on how business leaders use innovative approaches to shape their strategies. Contact us to discuss a change management plan to transform your organization or for a complimentary presentation on a business problem your team would like to solve.