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VOL. 128 | NO. 153 | Wednesday, August 7, 2013

Better Way to Measure Employee Happiness

By Verne Harnish & Michael Synk

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Verne Harnish & Michael Synk

Many CEOs think they can keep an eye on morale with annual employee survey, but that is like driving your car by only looking in the rearview mirror. By the time you get the results, most of the “accidents” have already happened: Grumpy employees have alienated good customers, incompetent managers have killed productivity and the best talent has left for the competition. You need to measure employee happiness daily or weekly.

New analytics tools: There are some cutting edge tools to help. Apple and Rackspace use the employee Net Promoter System (eNPS), a metric that is picking up traction, as Fred Reichheld, the intellectual father of NPS, mentions in his book “The Ultimate Question 2.0.”

While the well-known NPS tracks customer loyalty, the eNPS measures employees’ happiness, asking them in a confidential survey: “On a scale of 0 to 10, how likely is it that you would recommend your workplace to a friend or family member?” Employees have room to comment, providing qualitative data too.

Be prepared: The scores you get from your team are likely to be lower than you get from your customers on the traditional NPS. Employees tend to be tough critics—but if you’re willing to listen, they will tell you what you need to hear. At the same time, don’t obsess about your scores. The qualitative data is important too.

Choosing a tool that will allow you to measure morale on your team daily, weekly or at other frequent intervals will help you keep levels of engagement high. Just make sure that you use the system in a way that does not violate employees’ anonymity, or they won’t want to use it anymore.

Talk with employees weekly: New technologies are no substitute for meaningful conversations with your team. Senior leaders should formally visit with one employee each week and ask three simple questions: “What do we need to start doing, stop doing and keep doing?”

Then take a few minutes at the weekly management meeting to share what you’ve learned. This qualitative data, collected weekly, will give the senior team a real sense of what’s working and not working among the employees as patterns emerge over weeks and months of conversations.

Respond to feedback quickly: Make sure that you have the management bandwidth to quickly respond to feedback. Gathering data is useless if you don’t act on it. Nothing is more frustrating than being asked your opinion and then seeing

People, your most valuable asset, are intangible in accounting terms. Measuring their happiness is a way of making them tangible. It will be some time until this type of metric will appear on a balance sheet, but that doesn’t mean you should not pay attention to these measures. They’re some of the best leading indicators of a company’s overall health and value.

Verne Harnish is the founder of Gazelles. Michael Synk is the founder of In-Synk and is the Gazelles coach in Memphis. Contact Michael at msynk@in-synk.com.

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