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What Are The Goals & Benefits Of Employee Onboarding?

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November 14th, 2018

- Updated on

November 15, 2018 - 8:42am
 
A 2018 survey from Jobvite estimates that if you were to hire ten new employees today, three of those new hires would leave within 90 days.

What causes employees to leave an organization before they've even had a chance to succeed?

Most HR professionals point to reasons within their organizations: many companies don't measure employee retention and turnover, do not provide mentoring or coaching, fail to establish clear expectations of new hires, and fail to provide sufficient training that would help new hires succeed.
 
So what's the common thread? All of these items could be addressed if the offending companies were to establish an onboarding process designed to help new hires succeed.
 
In this article, we'll explain how an onboarding process works, what the goals are, and how employers and workers benefit from an effective onboarding plan that prepares new hires for success.
 
Employee orientation or onboarding
Photo by rawpixel on Unsplash

What is Onboarding?

Onboarding is a process whose goal is to integrate a new employee physically, emotionally and professionally into their new workplace, a process also known as organizational socialization. The process can vary in length between a few days and a few months, and there are no universal criteria for what steps are included, but HR departments typically try to address four key issues for new hires:
  1. Compliance - New employees need to be informed about benefits that they are entitled to receive through their employer and trained on legal rules and regulations that apply to them in their new job role. Items like I-9 employment eligibility paperwork along with forms for taxation and benefits are covered in the onboarding process. 
  2. Clarification - New hires need clarity about the expectations of their role. During the onboarding process, they should begin to understand their job and establish performance goals for the first six months. 
  3. Culture - During onboarding, new hires are introduced to the company culture for the first time. 
  4. Connection - Onboarding is a time to start connecting new hires with the internal and external resources they will need to perform in their new position.
During onboarding, new hires are usually assigned a space in the workplace. They may receive an orientation that helps them find their way around, They may be given opportunities to socialize with other employees and they often receive job-specific training that will help them to perform well in their role.

What are the Goals of the Onboarding Process?

The onboarding process facilitates a variety of goals that are important to both the organization and the new hire. Along with increasing employee retention and helping to minimize hiring costs, the goals of the onboarding process include:
  • Ensuring a new employee is prepared to contribute early and effectively in his/her new role. This means connecting them with resources both internally and externally that will help them perform their role, providing job-specific training and orientation programs, and pairing the new hire with a mentor or buddy that can help him/her in the first few months. 
     
  • Increasing the employee's comfort level in the team and the workplace. New hires are sometimes shy. They may not walk around and introduce themselves to new people that work on their office floor. They may not want to ask someone how to find the washroom. People that feel alone in their offices will search elsewhere for a sense of community at work. We can provide that by introducing the new hire to his/her colleagues, planning a group lunch for their first day, and preparing their work area in advance so they know they have a designated spot. Consider having your new employee meet with key team members to discuss their roles and how they will work together. 
     
  • Encouraging employee engagement and commitment. New employees bring fresh ideas, new perspectives, and different work experiences to their new roles. Harness these insights and learnings, avoiding the temptation to dismiss or pass judgment too quickly on whether they'll work. Remember that new employees aren't bound by existing cultural norms or practices and it will pay dividends in terms of their commitment.  
new employee working with team
 
A study of onboarding expenses determined that one in three companies spend $0 on their onboarding process, and among all companies, the average spend per new hire was just $67. How can we expect new hires to invest themselves in the success of our organizations if we choose to spend just $67 on making them feel at home? An effective onboarding process demonstrates appreciation for new hires and shows that the organization is invested in their success. 

What are the Benefits of Effectively Onboarding a New Employee?

A great onboarding process delivers numerous benefits to both the hiring organization and the new hire. Let's look at the most important ones:
  • Boost Employee Performance 
    Depending on the nature and complexity of a job, it can take a new hire up to a year to start contributing at the same level as an experienced veteran of your company. Elevating employee performance is a primary target of the onboarding process, and the Society for Human Resource Management (SHRM) has determined that an effective onboarding program boosts employee productivity by as much as 11%.
     
  • Enhance Employee Retention and Reduce Hiring Costs
    There are several studies that indicate the benefits of a comprehensive onboarding program as far as employee retention. The 2018 Jobvite survey mentioned earlier found that in addition to 30% of new hires leaving within 90 days, 43% indicated the role wasn't what they expected and 32% reported that they didn't like the company culture. Meanwhile, a separate study conducted by the Aberdeen Group found that 54% of organizations with a formal onboarding process experience greater productivity and 50% experience better employee retention.
When a new employee leaves, it can generate additional costs of up to 150% of their annual salary - just think of the lost productivity, the overworked staff that has to pick up the slack, the knowledge lost to your organization, and the wasted training costs. On top of that, there are costs for recruiters and to interview a replacement. It is much cheaper to invest in employee retention than to replace an employee who leaves because you didn't.
 
It is clear that employers can reduce turnover, and in doing so, reduce their overall hiring costs, by providing the training, social integration processes, attention, and engagement that new hires need to be successful.

Summary

Onboarding, also known as organizational socialization, is a process used to help new hires acclimate to the work environment. The goals of onboarding are to help the new hire feel comfortable in the workplace, earn their commitment to the organization and help them start producing and contributing to the cause. An effective onboarding process reduces hiring costs, helps organizations retain new hires for longer and boosts employee productivity.
 
Today's leading organizations are using comprehensive onboarding software to design and modify their onboarding process and ensure that no step is missed when integrating a new hire into the company and working to ensure their success.

Sara Pollock - AJO Guest Blogger As the Head of Marketing at ClearCompany, Sara Pollock has spent hundreds of hours interviewing, hiring, onboarding and assessing employees and candidates. She is passionate about sharing the best practices she has learned from both successes and failures in talent acquisition and management.