Believe it or not, the success of your company relies on a lot more than a solid business plan, strategic market positioning, or even an awesome product. A large part of your success relies on how successful you are with people and culture – in other words, on employee satisfaction and overall company environment.

Don’t believe us? Some of the most powerful companies in the world – like Google and Salesforce – also have an awesome company culture. Is it a coincidence that they have happy employees, a positive company culture, and sky-high revenue?

Probably not. In fact, companies with highly engaged employees are reported to have a 50% higher market premium than those who do not. 

Here’s the thing about measuring your success in these areas: you can’t make assumptions.

Don’t assume that your employees are happy with their jobs because they smile when they come into work. Don’t assume that you’ve got a great company culture because your employees grab beers together after work. Don’t assume people are going to work for your company for a long time because you offer a competitive salary. 

In the following article, we’ll take a look at why it’s so important to use KPIs to measure employee satisfaction and overall company culture, and three core KPIs you can use to measure success.

Free Download: 5 KPIs Every Business Owner Needs to Know

Why Use KPIs to Measure Success

As mentioned above, you can never assume that your employees are happy or engaged, or that you’ve got a great company culture. In fact, to know if your employees are truly engaged, it is important to understand the importance and benefits of employee engagement.

The best way to get an accurate assessment? 

Collect KPIs – key performance indicators that give you measurable insight into how satisfied employees actually are (an indication of a healthy culture). 

KPIs give you an accurate read on success for the following reasons:

  • They help you to track performance over time. Comparing your scores from the same time last year can help you measure how well you’ve improved – or worsened.
  • KPIs are objective. Reading open-ended employee feedback can be very helpful, but it also leaves room open for interpretation (For example, “My job is adequate” can sound positive or negative, depending on the interpretation of the person reading it). 
  • Finally, KPIs help you to compare your business to others in the same industry. How are other companies in the same space faring in terms of employee satisfaction and company culture? Using KPIs will help you to make an objective comparison. 

Ultimately, you’ll want to combine KPIs with open-ended feedback to get the richest insight into your success with people and culture. In a minute, we’ll talk about a tool that can help you get both. But first, let’s take a look at three core KPIs that you’ll need as a foundation…

eNPS: Employee Net Promoter Score

eNPS, or Employee Net Promoter Score, is a metric that helps you assess your employees’ enthusiasm about working for your company. If they’re enthusiastic, they’re likely to recommend your company as a place to work; if not, they’re likely to steer away from friends and potential colleagues. 

Employee posing in the office.

Why is this an important insight?

Because employee enthusiasm indicates more than basic job satisfaction. It indicates that your employees believe that you have a company culture worth engaging in, and a business worth committing to. And it indicates that your company is likely successful. Just look at Zoom – the most popular video conferencing tool in America, worth $35 billion – which has an extraordinarily high eNPS of 84). 

Here’s how to collect and measure eNPS:

  1. First, you’ll send out a survey through Nailted – a simple tool that can help you collect, calculate, and track your eNPS. The basic question you’ll ask is: How likely are you to recommend this company as a place to work to others?
  2. The resulting 0-10 answer will divide eNPS survey takers into three basic categories: Promoters (9 or 10); Passives (7 or 8); or Detractors (6 and below).
  3. The answer will be calculated with the following equation: 

[# of promoters/total # of survey takers] – [# of detractors/total # of survey takers] = eNPS

  1. The resulting answer can range from -100 to +100, so don’t be discouraged by a 30-50 score! If you’re in the 50’s and above, you know you’re doing well! 🙌
  2. Finally, you’ll ask an open-ended question (which you can also do through Nailted) – Please explain your answer. This gives your employees a much-needed opportunity to explain their score…and you an opportunity to gain insight into actionable ways you can improve their overall enthusiasm.

Tracking eNPS over time has several valuable benefits:

  1. Helps you measure the impact of your own efforts to improve company culture and team morale.
  2. Can help give you insight into specific events (such as a new client or project) that impact eNPS.
  3. Lets your employees know that you are continually invested in their satisfaction

ESI: Employee Satisfaction Index

ESI, or Employee Satisfaction Index, is a broader indicator of employee satisfaction than eNPS because it encompasses expectations as well as enthusiasm. 

ESI surveys rely on three basic indicators of an employee’s satisfaction:

  • How satisfied the employees are with their workplace or job…
  • How much their workplace/job is meeting their expectations….
  • And how close their current workplace is to “ideal.”

For each of these questions, employees will have the opportunity to respond on a 1-10 scale. 

Then, you’ll use the following equation to calculate your response:

[question mean value/3] x 100 = ESI

Just as with eNPS, you can use the employee satisfaction index (ESI) to track progress over time, compare your success with other companies in your industry, and assess how specific events in your company impacted scores. 

Employee Turnover Rate

Employee retention is a key indicator of the current and future success of your company. When employees stay longer, they grow in value, knowledge, and skill – and contribute more to your company. 

Employee turnover, on the other hand, is costly and damaging to your business. In fact, an employee that’s paid only $40k a year will ultimately cost at least $8k to replace – 20% of their total salary. And for higher-paid employees, that percentage only escalates – for managers who make $100k per year, replacement can cost a business as much as $213k. 

The bottom line? High employee turnover indicates that you’re definitely not performing well in the areas of company culture and employee satisfaction

Employee seemingly frustrated at the office.

And, it indicates that you might be spending more than you need to on hiring, onboarding, and retraining (not to mention, loss of valuable knowledge and morale).

Measuring your employee turnover can help you get an honest assessment of how you’re performing in terms of retention – and if you desperately need to make changes. 

Your employee turnover rate is measured by calculating the number of employees who left in a given time period divided by the number of average employees in the same time period. Then, multiply by 100.

In other words:

[employees who left in a given time period/ (employees at the beginning of the same time period + employees at the end of the same time period/2)] x 100 = employee turnover rate

If you’re lower than average in your results (average employee turnover across all industries was 17.8% in 2016 across all industries), then you’ll want to take action to make changes. How can you improve employee satisfaction and company culture to make sure employees stay longer at your company?

Retention Rate

Measure how many employees decide to stay for a defined period. For example, taking into account the 100 first days of new hires, detected as decisive, can be a starting point. 

# new hires who stay with the company for at least 100 days / # new hires in the same period = retention rate


Once again, Nailted can help you get the answers to these questions – and more – with regular employee surveys that:

  • Give your employees a regular opportunity to share optionally anonymous feedback with you and other employees.
  • Give employees a chance to show recognition through “claps,” creating a healthier, more positive company culture.
  • Run individualized campaigns to help understand employees’ progress, goals, and company alignment.
  • And more.

Don’t forget to download: 5 KPIs Every Business Owner Needs to Know

Improving Employee Satisfaction Through a Culture of Feedback

Now that you have a clear understanding of which KPIs you need to succeed, why not incorporate a feedback culture that allows you to implement them?

Start by building a habit with your team: ask them to give feedback once a week. Little by little, they will get used to it and build confidence, consequently making their feedback more detailed and sincere. 

And so, creating a culture of feedback through regular employee surveys can ultimately help you to improve employee satisfaction and company culture. 


Employees get the opportunity to share actionable strategies for change with you; they’re given value and a voice; and they’re encouraged to share positive feedback with one another, as well as constructive criticism – ultimately creating healthier communication. If you’d like to see how Nailted can help you achieve greater success with people and culture book a demo with one of our team experts!