MRX 2.0

MRX: A New Way to Represent Manager Effectiveness

MRX (Manager Recommendation Index) replaces the traditional NPS calculation with a more reliable and actionable method for evaluating manager effectiveness. It addresses the shortcomings of mNPS by offering a continuous scale and avoiding issues caused by small team sizes.

From the 15,000+ data points, we've seen managers have the most significant impact on employee NPS

MRX Calculation Methodology

It is calculated based on responses to the question: "On a scale of 0-10, how likely would you be to recommend your manager to your friends?”

1. Base Average Score: - Compute the average score of all responses on a 0-10 scale.

2. Scale Conversion (to -100 to 100):

A) If the average score ≤ 5: - MRX = -100 - This is based on our observation that less than 1% of managers score in this range. Hence, they are automatically marked as -100 to highlight critical performance issues.

B) If the average score > 5: - MRX = (Average Score - 7.5) × 40 - (This ensures scores fit a -100 to 100 scale, while preserving the context of high/low scores.)

3. Color Coding: Red: MRX ≤ 0: (Indicates a need for improvement; 25% of managers fall into this category.)

Amber 0 < MRX < 40: (Indicates moderate performance, with room for improvement.)

Green MRX ≥ 40: (Indicates strong performance; 45% of managers fall here, where employees are effectively promoters.)

MRX Calculation Example

Scenario: A manager receives the following scores from five direct reports for the 'Manager Recommendation' question (on a 0-10 scale): 7, 8, 8, 9, 10

1. Calculate the Average Score:

Average Score = (7 + 8 + 8 + 9 + 10) / 5 = 8.4

2. Determine the MRX:

Since the average score is greater than 5: MRX = (8.4 - 7.5) × 40 = 0.9 × 40 = 36

3. Interpret the MRX: MRX = 36, which falls in the Amber range (0 < MRX < 40). Indicates moderate performance with room for improvement.

Why Convert the Average Score (0-10) into a -100 to 100 Scale?

1. Improves Perceptual Clarity: - A score like '8.2' on a 0-10 scale doesn't feel actionable. However, on the MRX scale, it translates into a more impactful representation.

2. Motivates Managers to Act: - Subtle score changes become more apparent. For example, an increase from 7.2 to 7.4 translates to an 8-point improvement in MRX, which feels more significant.

3. Alignment with Human Intuition: - Scores above 80% (on the -100 to 100 scale) feel positive and actionable. - Managers used to focus on mNPS ≤ 0 as critical. Similarly, MRX ≤ 0 now carries the same emphasis, while providing a clearer scale.

4. Consistency Across Teams: - mNPS, especially in small teams, created discontinuous scores that lacked reliability. MRX resolves this by offering a continuous and fair evaluation scale.

Why mNPS is Not an Ideal Aggregation

1. Noise in Small Teams: - The NPS calculation framework (%Promoters - %Detractors) is noisy for small teams. - 63% of managers have five or fewer direct reports. In such cases: - For a team of 4, mNPS moves only in multiples of 25. - For a team of 5, mNPS moves only in multiples of 20. - Even though mNPS ranges from -100 to +100, the values are highly discontinuous in smaller teams.

2. Lack of Correlation with Underlying Manager Questions: - In scenarios where all direct reports (DRs) rate 8 on the 0-10 scale for the manager recommendation question: - mNPS would be 0 (Red), despite other manager-related scores being Amber or Green. - This creates confusion for managers, who might see Amber/Green ratings on individual questions but a Red rating for mNPS.