How to measure employee engagement.
We know employee engagement is important and is directly correlated with improved business results. Companies that are successful often cite employees’ willingness to go above and beyond as one of the drivers of their success. Business results are easy to measure – increased profitability, better return to shareholder, reduced turnover.
When it comes to employee engagement, it can be a little harder to determine. How do you put a stat against the discretionary effort that indicates your team are delivering at the top of their game and are committed to your goals? Which numbers prove you are on your way to your engagement happy place?
There are lots of metrics you can use but only some will make sense to you. The numbers can be broken down into four distinct categories – financial, employee, performance and operational results. Pick a couple of metrics that are hot buttons for the business or have a financial impact and measure against current benchmarks.
You are looking for increases in these metrics against previous results. But be realistic. Just introducing engagement boosting activities won’t automatically increase levels overnight. You have to be consistent and keep focussing on it. Engagement is dynamic and driven by more than just one thing so pick your metrics, set expectations and review each quarter.
Revenue or gross profit (GP) per employee
Employee expenses vs GP (%)
% new vs return business or customers
% lost customers (attrition)
% increase of customer account
Cost of new customer acquisition
Net promoter score or customer satisfaction score
% annual turnover
% increase in overall employee numbers
Number of new and replacement hires
Promotions and promotions into leadership roles
Days lost to absenteeism
Cost of absenteeism
Job satisfaction score
Employee Net Promotor Score
Employee happiness rating
Job referrals (internal or external)
Cost of recruiting
Average % replacement cost
Training cost per employee
Number of employees trained
Pre & post training assessment
Total training cost
% engaged, neutral and disengaged
% employees aligned with the brand
Number of employee occupational claims
Number of hours lost to occupational claims
Cost per occupational claim
Number of safety incidents reported
Cost per safety incident
Total safety expense
% revenue plan achievement
% individuals achieving target
% teams achieving target
% groups/departments achieving target
% annual leave utilised
% personal leave utilised
Number of cost saving ideas generated
Total number recognitions given/received
Number of unique givers and receivers
% managers giving recognition
% cross-functional recognition
Average number recognitions per employee
% of safety incidences reported
% of safety issues identified in audit
% of safety issues corrected
% of employees fully-trained
Days since safety incidence
Number of new ideas implemented
Number of cost saving ideas implemented
% time spent rectifying errors
% customer SLA’s met
% process adherence
% quality output
% errors per item/output
% items returned
Response time
% repeat repairs/rectifications
% shrinkage
Remember, improving engagement is not something you can knock off in the first quarter and hope for the best for the rest of the year. Engagement is dynamic so you need to retain a focus on the key drivers for your employees.