Good onboarding can help deepen employee engagement, boost productivity, and reduce turnover. But failure to get off on the right foot with new hires can cause many to leave within months of being hired, squandering the high costs of recruiting top talent.
Onboarding programs often get bogged down in frustrating cross-departmental manual processes. They fail to meet rising employee expectations, and tend to suffer from a dearth of data for benchmarking and performance measurement.
Onboarding requires interdepartmental cooperation
Few business processes touch as many parts of a company as onboarding of new hires. While HR teams generally lead the onboarding process, it requires the active participation of IT, security, operations, facilities, finance, and sometimes other business units. Relationships between these stakeholders tend to be dotted line, with limited accountability.
Miscommunication between departments can result in missing equipment and unapproved credentials. Dependent processes can stack up, leaving new employees idle, annoyed, or both. Some HR teams can navigate this kind of complexity on their own, but companies can’t count on that at a time when 28% of workers will quit within 90 days of starting a new job because they had a poor onboarding experience.
Frustrating manual processes persist
Even as other core business processes, such as IT operations or customer experience management, have become automated and digitized, many HR departments continue to rely on manual or paper-based workflows for employee onboarding.
Communication between recruiters, candidates and hiring managers is often a hodgepodge of email, phone calls, and texts. It’s tough to manage processes efficiently using spreadsheets and checklists. Paper forms that must be digitally converted invite costly errors and even fines from regulatory agencies.
Poor visibility handicaps measurement
With so many people owning small parts of a manual onboarding process, few individuals have visibility into how well an entire onboarding program functions. Nearly half of all HR departments don’t even evaluate the effectiveness of their onboarding programs, according to the 2017 Strategic Onboarding Survey Report from Silk Road.
And how could they? A lack of collected data makes it almost impossible to establish benchmarks against which goals for success can be measured, leaving HR professionals little traction to identify underperforming departments and recommend improvements.
Rising employee expectations
Exposure to slick consumer experiences and a tight job market have led incoming employees to expect more from employers, and they aren’t finding it. Just 12 percent of employees strongly agree that their companies have a strong onboarding program, according to recent Gallup research.
The old adage applies: You don’t get a second chance to make a first impression. According to research from Robert Half, 91% of new hires say they would consider quitting during their first month on the job if a new job didn’t live up to initial expectations. Among the specific reasons why, more than a third pointed to a lack of proper onboarding.
At the C-level, HR executives are anticipating but not yet executing a dramatic shift in priorities to address this new generation of employees. In poll of CHROs by ServiceNow, when asked whether their role is defined by “the ability to create a digital and consumerized employee experience,” 16 percent said that is true today, but 56 percent believe it will be true within just three years.
Turnover from bad onboarding is expensive
Poor onboarding experiences ultimately undermine a company’s ability to retain talented new workers who cost companies more and more today to recruit and hire and who have plenty of options elsewhere. The quit rate, which has risen steadily since 2000, hit a record high in October 2018, according to the Bureau of Labor Statistics, reflecting the high number of people voluntarily leaving posts to take their chances in a hot job market.
Millennials account for about half of job quitters, according to a 2018 study by the HR consulting firm Mercer, but don’t think that replacing the workforce’s youngest demographic comes cheap. Replacing an entry-level worker can cost half a year’s salary. Filling executive vacancies can soar as high as 200% of salary.
Given how much it costs to fill vacancies, companies simply can no longer afford the risks associated with delivering a poor onboarding experience.