1 833 APPLAUZ Language:
Create Account!

How to Measure Employee Engagement

published: January 9, 2020

Engaging employees is key to keeping employees loyal, happy, and productive on a long-term basis.

However, similar to other fundamental human emotions like happiness and sadness, employee engagement is a fleeting state, and as a result, tricky to measure accurately.

That is why managers should work to keep their finger on the pulse of engagement. Even though employee commitment and satisfaction seems intangible, it can be measured with the help of the following employee engagement metrics.

bigstock-happy-sadTraditional Measures of Employee Engagement 

Businesses often rely on intuition to identify employee dissatisfaction. When an employee is unhappy, the distance and detachment quickly become visible to managers and colleagues working closely with a person.

Gut intuition is a valuable alert system—telling us something is off in our environment, in this case—with an employee.

Despite our intuitions usually being correct, our instinct is not great at reaching a deeper understanding of the issue's source or measuring its severity.

Companies who are serious about investing in employee happiness and engagement need better tools and metrics to stay connected to employee sentiment.

In this article, we will outline the six metrics to hat help put a number to disengagement in your business.

8 Employee Survey Best Practices to Measure and Improve Engagement - Download PDF Guide

bigstock-Customer-Service-Experience-An-282212215The 6 Employee Engagement Metrics You Should Be Tracking

1. Employee net promoter score (eNPS)

This metric is based on the "Net Promoter Score," which was initially developed for businesses to measure customer loyalty.

The eNPS score applies the same method to assess employee loyalty.

The eNPS score is important for managers because it assesses employee commitment, asking the question: how likely are you to recommend this company asPS_Survey-Reports_eNPS a great place to work? 

Employees respond anonymously on a sliding scale of 1-10. From very like to highly unlikely. Based on employee responses, workers are classified into three categories: detractors, passives and promoters.

As you can imagine, detractors are individuals who do not recommend working for your organization. And promoters are your biggest supporters.

While this metric says anything about why employees don't recommend your organization, it does an excellent job of collectively assessing a global picture of how dedicated your workers are.

2. Voluntary Employee Turnover Rate

Voluntary turnover occurs when an employee leaves a company on their own volition. Measuring your turnover rates will give you an idea of the general health of your company.

Asset 25-1When employees don't feel fulfilled or impressed by a company's offerings, high voluntary turnover is usually the first symptom. Or they might be unfairly compensated or challenge, and as a result, have eyes for organizations offering a higher salary and more challenging position.

To calculate the monthly employee turnover rate, all you need is three numbers:

  • The number of active employees at the beginning of the month (B)
  • The number of active employees at the end of the month (E)
  • The number of employees who left during that month (L)

Then, calculate the average (average) number of employees by adding your beginning and ending workforce and dividing by two.

Finally, you should divide the number of employees who left (L) by your average number (average) of employees and multiply by 100 to get your final turnover percentage.

Pro Tip: Turnover rates vary significantly from industry to industry. However, turnover rates should (ideally) be lower than 10%, which is a very healthy turnover rate across the board.

3- Customer Satisfaction Rate (CSAT)

 

Asset 66Happy employees are the foundation of customer satisfaction. So, if you're managing customer-facing employees, one of the best measures of employee engagement is how satisfied your customers are with their service.

Employees that deliver top customer service intentionally go beyond the minimum of what is expected. Passion and ownership underpin their work. There is a personal and intrinsic motivation to provide excellence.

Measuring customer satisfaction is possible in several different ways.

It can be done quantitatively with formal customer satisfaction surveys, or more casually through conversation or feedback. Either way, when you make an effort to gather insights from customers, you'll quickly notice patterns and trends. For example, when the same associate receives negative feedback, complaints, or a poor CSAT score, you know who the likely common denominator is. As a result, time and energy should be invested in addressing and correcting the issue.

4- Employee Productivity

In the traditional sense, productivity is about meeting a certain output within a given time period. In short, meeting a quota. This is still the case for certain lines of work. However, In our modern work environment, the definition of productivity should take into consideration the value and quality of the work produced.

Asset 69i

When quality or quantity of employee output begins to suffer, this if often a sign of employee disengagement.

For example, an employee consistently misses their daily or monthly quotas, or they begin delivery work of poor quality—with apparent errors and lack of attention to detail.

You can keep track of your employee's productivity and goal attainment with the help of an employee engagement software that incorporates productivity tracking features, like Applauz Recognition.

As a case in point, a meta-analysis conducted by Gallup showed businesses that scored highest in employee engagement, are shown to be 22% in profitability and show a 21% increase in productivity."

5- Employee Absenteeism Rate

Absenteeism occurs when employees regularly fail to show up for work. It can negatively impact productivity, and it's a red flag for employee disengagement.

This metric measures the percentage of employees who were absent over a given time. Higher percentages can indicate high levels of employee disengagement.

Asset 75iTo measure employee absenteeism you all you need is the following values:

  • Number of employees
  • Number of absences
  • Total number of work hours

Temporary band-aid solutions will not suffice if you wish to lower employee absenteeism in an enduring way. The root cause of employee disengagement must be addressed with a strategically implemented Employee Engagement Program for absenteeism issues to be truly resolved.

In fact, according to a Gallup Workplace report, businesses boasting a highly engaged workforce have a powerful impact on lowering employee absenteeism.

6 - Employee Satisfaction Score

Asset 68iThis metric can only be obtained by administering employee surveys containing questions designed to measure employee satisfaction.

You’ve likely heard of (and probably taken) a work survey of this nature in the past.

Common survey questions are “on a scale of 1 to 10 how happy are you at work?” and “do you feel valued at work?”

Pro Tip: With the help of a Pulse Survey Tool you can administer anonymous employee surveys and stay connected to how your employees are really feeling.

bigstock-Group-Of-Casual-Business-Worki-312521434

Final Thoughts

Often, executives only pay attention to employee engagement once perceptibly high absenteeism and turnover rates occur among the top talent in their workforce. In short, when employee disengagement is symptomatic.

At this point, disengagement has likely spread to all levels and evolved into a complex issue which will require a great deal of time and resources to fix.

To nip disengagement in the bud, it's incumbent on executives and managers to keep their finger on the pulse of the workforce satisfaction—to systematically monitor levels of engagement with these important metrics.

The goal is to catch the early (and often subtle) signs of dissatisfaction and disengagement before they manifest as full-blown absenteeism or, worse, voluntary turnover.