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May 30, 2013 | HRIS | Posted by Ascentis

Asking Your Human Capital Management Provider About Net Promoter Score

Net Promoter Score (NPS)…ever heard of it?  You may not have heard of that term, but most of you have probably unknowingly been involved with it.  Have you ever taken a survey that asks something like “How likely are you to recommend such and such to a friend?”  If so, you’ve participated in calculating NPS!

WHAT IS NET PROMOTER SCORE AND HOW IS IT CALCULATED?

NPS is a loyalty metric and is based on the premise that every company's customers can be divided into three categories: Promoters, Passives, and Detractors. By asking customers one simple question — How likely is it that you would recommend a company to a friend or colleague? — these groups can be tracked and a clear measure of a company's performance can be established.

 

 

So here’s a quick example:  Assume there are 100 survey respondents.  25 of the 100 (or 25%) gave 9s or 10s.  55 of them (or 55%) gave 7s or 8s.   The remaining 20, representing 20%, gave a score between 0-6.  That leads to a NPS score of 25%-20% = 5%.

 

For those of you that are good at math, you can see that NPS scores can range from positive 100% all the way to negative 100%.  A 100% score would mean that everyone gave 9s and 10s.  A -100% score would mean that everyone gave a score between 0-6.

WHAT IS ASCENTIS' NET PROMOTER SCORE?

 

We care deeply about client satisfaction on every level and work hard to understand and measure our clients’ experiences so that we can continually improve our processes, products and services.  In our most recent client survey, we earned a NPS score of 37%.  In the chart below you can see how our score compares favorably against others’.

 

WHAT SHOULD YOU ASK YOUR HUMAN CAPITAL MANAGEMENT PROVIDER ABOUT NPS?

For those of you who are not Ascentis customers, I’d encourage you to ask your human capital management (HCM) vendor this question:  What is your Net Promoter Score, and how do you calculate it?

 

When you ask that question, you’re likely to get one of these responses:

 

1)     We don’t measure NPS.  Honestly this would concern me.  NPS is fast becoming a cross industry standard way to measure customer loyalty and satisfaction.  If they’re serious about treating their customers right, they should be measuring NPS.  The bottom line is that if they aren’t measuring it currently, they should be.

 

2)     A second response I’ve heard is, we measure it, but we don’t share it publicly.  In my opinion, that’s a response grounded in fear.  They don’t want to tell you because they’re afraid of what?  There could be multiple fears coming into play, but the first one that comes to mind for me is the fear that they have a bad score.  See the -10% score in the chart?  That vendor falls into this category!

 

3)     Lastly, the vendor could openly tell you “our NPS score is x%”.  Yay, hurray for transparency!  Hopefully a growing number of vendors out there are measuring and openly sharing their NPS results.  In this case use the NPS as an important metric in evaluating and comparing HCM vendors.  One caveat though…make sure to dig into “how do you calculate it?”  If a vendor isn’t using the formula described above, then they’re not using the standard measurement of NPS, and you’d be comparing apples to oranges.  Beware of numbers that have been manipulated with the intent to deceive!

 

FINAL THOUGHTS

Our focus on NPS and the stellar scores that we have earned underscore that we are deeply committed to a superior client experience.  And even though our marks are good, we always want to know if and where there is room for improvement.  We know that our success is tied directly to the satisfaction, and advocacy, of our customers.  This is why throughout our organization, from client support to engineering to our CEO and everybody in between, your satisfaction is our top priority.

 

 

-Mike Lin

Payroll Product Manager, Ascentis

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