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Guide and Exam Tips on Net Promoter Score

Introduction: Net Promoter Score (NPS) is a fundamental metric used in Agile Project Management that measures the loyalty of customers to a company. NPS is both an accurate and reliable indicator in identifying growth opportunities.

Importance: NPS assists in evaluating customer satisfaction and assessing the relationship between the organization and its customers, making it a critical component of Agile Metrics. Higher NPS is an indicator of customer loyalty and hence, higher future revenues.

Concept: The Net Promoter Score is calculated based on responses to a single question: How likely is it that you would recommend our company/product/service to a friend or colleague? The scoring for this metric takes place on a scale of 0-10.

How it Works: The score is divided into three groups: Promoters (score 9-10), Passives (score 7-8), and Detractors (score 0-6). The NPS is then calculated by subtracting the percentage of customers who are Detractors from the percentage of customers who are Promoters.

Exam Tips: Understanding the following points would aid in answering exam questions related to NPS:
1. Concept and Calculation: Remember how NPS is calculated and what each group (Promoters, Passives, and Detractors) represents.
2. Metric Utility: Be clear on why and when NPS is used, what its pros and cons are, and how it informs business decisions.
3. Scenarios: Be ready to interpret NPS in different hypothetical scenarios and recommend strategic actions.
Those who understand the concept well, provide examples in their answers, and draw logical connections would have a higher chance of scoring well on these topics.

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Net Promoter Score practice test

Net Promoter Score (NPS) is a customer-focused metric that measures the likelihood of someone recommending the product, service, or organization to others on a scale from -100 to 100. Although not exclusive to Agile, NPS can be used by Agile teams to gauge customer satisfaction and the perceived value of their work. It helps teams prioritize features or improvements to be developed, based on their importance to end users. NPS provides valuable feedback for ongoing product development, ensuring that the team's efforts are focused on delivering value to customers. By tracking NPS over time, Agile teams can evaluate the impact of their incremental changes on overall customer satisfaction and make data-driven decisions to enhance the product or service.

Time: 5 minutes   Questions: 5

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