Creating a Balanced Scorecard
How companies are using online
surveys to measure employee satisfaction
By Dennis Frayne
With technology improving rapidly and costs continuing to
drop, businesses are conducting more sophisticated online
surveys. No longer confined to traditional paper-based surveys,
companies are reaching out more than ever for employee feedback.
These surveys include employee satisfaction, upward or "360"
evaluations and the performance review process. Online surveys
now include open-ended questions, multiple formats and complex
branching tools, giving businesses the potential to gather
more insight about employees, corporate culture and business
processes than ever before.
Says Charlie Watts, Global Practice Leader for Organization
and Employee Research at HR consulting company Towers
Perrin , "We see two trends emerging with regards to
online surveys: One, companies want more employee measurement
and two, they are using data gleaned from employee surveys
to make a business case for investments."
Creating a "Balanced Scorecard"
Linking employee satisfaction (ESAT) to the bottom line
is not new. First cited in the Harvard Business Review in
1994, the "service-profit chain theory" holds that satisfied
employees deliver superior service, which creates satisfied
customers. In turn satisfied clients create growth in revenue
and earnings and increased shareholder value. This theory
was linked to a study done by Sears, Roebuck and Company where
the company tracked the performance of its managers and linked
employee satisfaction to customer satisfaction and financial
performance. The company transformed the way it did business,
resulting in dramatic financial improvements.
Taking the service-profit chain theory further, Robert Kaplan
and David Norton developed a new approach to strategic management:
The balanced scorecard approach centers on a company's vision
and strategy and includes not only financial measures, but
also measurements for customer satisfaction, internal business
processes and employee satisfaction. As companies today grow
and change through mergers and acquisitions, new business
growth and societal changes, they are developing metrics,
collecting data and analyzing it in order to give themselves
a balanced scorecard -- in other words, a more complete picture
of the business.
Companies review financial data at least monthly, if not
daily or even hourly. To understand what's going on from an
employee perspective -- which is what ultimately drives financial
results -- organizations need to collect employee data more
than just once a generation. That is just what is happening
as companies begin to pay more attention to employee satisfaction
via online surveys.
Tying ESAT to the Bottom Line
Until about five years ago, measuring employee satisfaction
using paper-based surveys was difficult, costly and time consuming.
Says Carol Boyce, Ph.D. and Ron Rembisz, Ph.D. of the international
management consulting firm, Rembisz
and Associates, "By the time the surveys were completed
and analyzed, things had probably changed in the organization.
Due to costs, a company would probably roll out one ESAT survey
every other year -- which means management really didn't have
a true indicator of employee satisfaction."
Much of this has changed due to the advantages of online
surveys. According to Boyce and Rembisz, companies are "taking
employees' temperatures" much more frequently, conducting
short 10-15 question surveys weekly, monthly and quarterly
on a number of issues including innovation and growth, employee
motivation, leadership support for employee autonomy, culture
and internal communication effectiveness.
"Companies can now cost-effectively measure any aspect of
their business before an intervention occurs, during the intervention,
then again afterward -- to make sure the invention 'sticks'
-- thanks to online surveys," adds Rembisz. Because results
are available within 24-48 hours, companies have real data
on which to base decisions.
Online surveys also allow real-time, two-way dialogue. If
an outside third party is conducting the survey, the consulting
company can get back to individuals with questions such as,
"Can you tell me more about why you feel this way?" Say Boyce
and Rembisz, "This is particularly effective if a department
has a harsh boss. We can set up a team to help a department
deal with this issue, such as, 'Have you sat down with your
boss as a group?'"
Companies are also using ESAT surveys to effect organizational
change. Sean Ryan of White
Water Consulting Group says, "People want to perform at
their best. Effective survey feedback helps organizations
pinpoint the barriers and challenges employees grapple with
as their organizations perpetually change. ESAT surveys give
managers a regular pulse on how people are doing as the change
However, adds Ryan, surveys also bring out issues that are
occasionally difficult to deal with, which is why companies
will sometimes ignore or hide survey results. "A company can
have too much on its plate and not enough time, energy or
resources to deal with serious culture issues. To be effective,
organizations really need to commit to widely sharing the
results of ESAT surveys and engaging everyone in the process
of closing gaps."
Companies are also using online surveys to measure the effectiveness
of specific departments, such as Information Technology (IT).
Dick Mathews, of consulting firm Mathews
and Company, reports, "Our clients use surveys to rate
their IT departments. IT is central to companies now, and
a low performing department can adversely affect a company's
employees and business processes. We use surveys to measure
IT's effectiveness within an organization. Sometimes, the
CIO's compensation is based on that measure -- which really
shows how internal customer satisfaction is tied to the bottom
Online Survey Best Practices
Survey response depends on how the survey process is designed
and implemented. The following short list of best practices
will help ensure your survey process goes smoothly and receives
high response rates. (For detailed information, see the article,
Best Practices for Employee Surveys.")
Get Management Buy-in - "Before embarking on any type
of survey, ensure you have management buy-in," advises Mathews.
Prior to giving the survey, management should have a plan
of action for what happens after the survey is completed.
According to Ryan, the worst thing any company can do is to
conduct a survey and then not follow-through on the results.
Establish Credibility - According to Mathews, establishing
survey credibility is imperative if you want high response
rates. To establish credibility, Mathews recommends the following:
Ideally, the survey should come from a respected third party
source outside the company rather than your corporate HR department.
When e-mailing the survey, use each recipient's full e-mail
address. You don't want to make it look like a bulk mailing.
Give the name and e-mail address of the survey contact person.
Stress respondents' confidentiality (this is very important!).
Provide glitch-free technology - Online surveys should
be easy-to-use and as fool-proof as possible. People will
abandon a survey in process if they encounter glitches.
Ask for verbal feedback - Once the data is analyzed,
ask employees what their scores mean. "Typically, if a company
receives a low score in the area of 'communications,' their
first response is to send out an employee newsletter," Ryan
says. "Don't do this. Instead, ask employees why they scored
the way they did -- you'll learn why people feel the way they
do and what really needs to change."
Post the results - Don't leave employees hanging,
Mathews advices. Analyze and communicate the results of your
survey, then set improvement goals and accountability to ensure
goals are met.
Dennis Frayne is CEO of Hostedware, a company
that provides online surveys for human resources, training
and education professionals, market researchers and membership
associations. He can be reached at
Service or (800) 211-6967.
Corporation is a pioneer in providing online software
solutions for research, education and performance improvement.
Hosted Survey and Hosted Test are used by human resources
professionals, market researchers, education and training
organizations and membership associations worldwide.
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