It’s crucial to realize that employee engagement directly affects how well a company grows. Leaders are aware of how important employee engagement is to corporate expansion. Genuine employee engagement is essential to a company’s success. Therefore it is important to understand what are employee engagement evaluation KPIs.
First, to learn more on engagement, see our articles What is employee engagement and Why employee engagement is important.
So in this article let’s find out what are employee engagement evaluation KPIs and what are the best ones to implement in your company.
What is an employee engagement evaluation KPI?
An employee engagement Key Performance Indicator (KPI) is a technique to assess how well a company is achieving its objectives and measure employee engagement. KPI is used by businesses at different levels to measure their success.
KPIs usually come in two forms:
- High-level
- Low-level.
Low-level KPI is more concerned with a specific process or employee of a distinct department, such as the marketing or sales department. Whereas high-level KPI is more concerned with the overall performance of the company.
You could be looking for techniques to accurately assess employee engagement because it’s crucial to corporate success. If your employees are engaged and overall happy with their work, the company wins. Here, KPIs serve as possibilities to inspire your staff.
Most often used KPIs to evaluate employee engagement
Make sure the KPIs you select are clearly defined and picked because there are a lot of KPIs that may be used to match with your business goals.
The KPIs we will be looking at are as follows:
- Retention and turnover
- Employee net promoter score (eNPS)
- Employee satisfaction index (ESI)
- Internal Promotion Rate
- Absenteeism
1. Retention and turnover
The rate of turnover is useful in determining the length of time that employees departed. The business can concentrate on areas that require more care, particularly those where employees aren’t having fun, by keeping a turnover rate low.
You should aim for an annual turnover rate for your organization of 10% or, ideally, even less.
Turnover Rate Formula is as follows:
(Total number of departing employees) / (Total number of employees at the beginning of the period)
2. Employee net promoter score (eNPS)
How many engaged employees work for your company can be easily determined using the employee net promoter score (eNPS). Business executives have transformed net promoter scores into a KPI to determine staff engagement. What’s interesting, is that those were originally used to gauge customer loyalty,
All you have to do is, on a scale of 1 to 10, ask, “How likely are you to recommend our organization as a place to work?”
The results would be as follows:
- Detractors (score of 0-6)
- Neutral (score of 7-8)
- Promoters (score of 9-10)
Your promoters serve as great brand ambassadors for your business, assisting you in luring in and retaining talent. Neutral employees are the first in line to become the next promoters if you respond to their feedback. Even if they are unlikely to say anything positive or negative about the business.
3. Employee satisfaction index (ESI)
The employee satisfaction index (ESI) calculates the level of job satisfaction among your staff members. Employee engagement focuses on dedication and work production, whereas employee satisfaction emphasizes employee fulfillment and happiness.
You must ask the following questions to determine your ESI score:
- How happy are you with your employment, on a scale of 1 to 10?
- How well does your job satisfy your expectations, on a scale of 1 to 10?
- How similar is your place of employment to your ideal job, on a scale of 1 to 10?
Calculate this as follows: ESI = (((question mean value/3) – 1)/9) x 100
A score between 1 and 100 is the outcome; a higher score indicates greater employee satisfaction.
4. Internal Promotion Rate
The potential for professional growth within the company is one of the primary factors influencing employee engagement. This emphasizes the value of the Internal Promotion Rate because it shows how well a business is able to retain outstanding talent.
Internal Promotion Rate= total number promoted employees/total number of employees x 100
Consider the Internal Hire Rate (workers transferring positions within) and Internal Employee Referral Hire Rate if human resource management is your focus (new hires acquired after an employee suggestion).
5. Absenteeism
Employee satisfaction is highly correlated with absenteeism. Employees that fail to arrive for work are a problem for the team as a whole.
A team’s productivity may decrease when someone is absent or falls behind, which will lower employee satisfaction. A high absence rate may indicate inadequate working motivation and productivity.
In conclusion
Finding the proper KPI for employee engagement can be challenging, however it is good to have plenty of options. We have compiled 5 of the options that will help in employee engagement evaluation.
To evaluate these crucial KPIs, some businesses choose to conduct recurring feedback sessions, while others use tools like questionnaires.
The main goal is to find what works for your company and your leaders, employees now that you know what are employee engagement evaluation KPIs available.
