Why Onboarding Matters: What the Numbers Say

Data shows that strengthening your onboarding process helps you recruit, engage, and retain top talent. It even revitalizes office culture, too.

terence-mazon-big-t-style

Most of us have had a poor onboarding experience at some point in time. You know how it goes: You show up with a stomach full of butterflies to a curiously bare desk, the training program doesn’t really cover what you need to know, and you’re overwhelmed by so much information that you’re ready to run for the door before lunch.

When it comes to onboarding, comprehensiveness and length matter. Onboarding shouldn’t end after one week, or even two. There’s actually a great deal of value in strengthening your onboarding programs to provide support for up to a full year after new hires start. In fact, your onboarding process is one of the most significant factors in determining not only the effectiveness of new employees in their role, but also their overall engagement and satisfaction with the company. Don’t just take our word for it: here’s what the actual numbers say about why your onboarding process matters.

Increase Connections, Increase Engagement

In 2016, a study by Gallup found that 70% of U.S. workers reported that they did not feel engaged at work, with Millennials being the least engaged generation in the workforce to date. Nearly half of those Millennials who were actively disengaged indicated that they were likely to switch jobs in the next 12 months, compared with only 17% of engaged Millennials.

Imagine you’ve just spent the last 4 weeks jumping through hoops, attending interviews, and learning about a new company in the hopes of landing a dream job. The people you met during the interview process were extremely welcoming, and they stressed to you how much they value every team member. Then you show up on the first day and the person that greets you has no idea who you are, and (even worse) your manager is nowhere to be found. Not only would you be confused and flustered, but you’d probably also be a little disappointed.

For many new hires, this is a very real scenario. Companies put a ton of effort into finding the right fit during the recruiting phase, but often drop the ball when it comes to fostering the right culture once the ink is dry and the employee walks through the door. The importance of providing a welcoming environment and helping forge connections during an employee’s first days cannot be overstated.

So, how can you get new hires engaged early, increase job satisfaction, and boost retention rates? Rather than focus exclusively on training and role-specifics, be sure to include opportunities for new hires to get to know others within the company. This can happen in the form of company lunches, team happy hours, scheduled coffee dates, or whatever works for your team.

Keep in mind that what works for one new hire may not work for every person that joins your team. While one employee may find it easy to get acquainted over drinks and karaoke, another may prefer the intimacy of a quiet coffee chat with a single coworker. Whether you create different types of internal networking events, or allow your employees to decide what they would like to do during their 1:1 chats, flexibility is key. Most importantly, be sure you’re giving new hires the chance to connect with people they may not work with every day.

Carly Guthrie
“First days are an opportunity to tell the story of who you are and what you want to accomplish, and have that stick with every single person who joins your organization. You want to take the opportunity to validate their decision to join.”
Carly Guthrie
Health Ceramics, Director of Human Resources

The First 90 Days Matter.

A study published by the Academy of Management Journal found that your new hire’s first 90 days have an incredibly strong influence on their future progress within the company, and Forbes.com suggests that employees who go through a structured onboarding process are 58% more likely to remain with your organization after three years.

In other words, the first 90 days is when your new employees build relationships with management, colleagues, and your company. If support is high from teammates and company stakeholders, new hires are more likely to have positive attitudes toward their job and work harder as a result. On the other hand, when new hires don’t feel supported, they are more likely to report feeling unsatisfied with their job and wind up being less productive. In short, employees who have less guidance during the early weeks in a new role frequently don’t last more than four months—not exactly the desired outcome when you’re pouring time and resources into recruiting the right team members in the first place.

If you’re aiming to build a top-notch onboarding process, think about more than just the basic need-to-know information you’ll need to give your new hires, and lean on some tried-and-true building blocks like these best practices:

Buddy Programs: From one company to the next there can be a great deal of variation in how buddy programs are executed, but they’re all centered around the same basic principles: A new hire is paired with a buddy or mentor who has been with the company a while, and that person is there to show them the ropes and help them get adjusted. Having a buddy can help new-hires feel connected from their first few days on the job, and having an extra person to turn to when they have questions will ease some of the burden placed on managers and HR.

30/60/90-Day Check-ins: One of the worst things you can do for a new-hire is bring them on, spend time onboarding them, and then release them into the wild never to check in with them again. You want new employees to be invested in the company, right? Then show that you’re invested in them and their growth. Have managers schedule 30/60/90-day check-ins with their direct reports to assess progress, collect feedback, and set expectations and goals. Consider adding check-ins from the people ops team, too.

New Hire Feedback: Collecting feedback from your new hires (and actually acting on that feedback by celebrating wins or correcting issues promptly) will show them that you’re listening, and that they matter. Another upside: Giving your new hires the opportunity to openly share what’s working and what isn’t gives you the candid feedback you need to continue shaping a stronger and more effective onboarding process.

Set Expectations Clearly

Clear guidelines and expectations aren’t corporate mumbo-jumbo. They’re actually critical to setting an employee up for success. A survey by the Society for Human Resource Management found that ~23% of new hires who quit in their first six months indicated that “receiving clear guidelines” about their expectations would have helped them stay in the role longer. The best onboarding programs communicate performance goals early, lay out a plan for progress, and give new hires opportunities to ask questions or receive mentorship. Having these goals somewhere they can be easily referenced by the employee is helpful too, since remembering everything can be daunting in the early days.

Increase motivation and satisfaction by setting up a quick win project for new hires during their first few weeks. Quick wins (low-hanging fruit, slam dunks, etc.) have been shown to be great motivators because they raise the likelihood positive results for effort spent. Your new hires will immediately feel accomplished and proud of the work they’ve done with a win under their belt, and in turn will feel more motivated and energized to keep going.

It’s not just about hard metrics, either. Helping employees find purpose in their work is an invaluable means of increasing retention. Truly effective onboarding doesn’t just set metrics-oriented goals: it also strives to integrate new hires into company culture and values.

Global Human Capital Trends 2015
““Every program in HR must address issues of culture and engagement: how we lead, how we manage, how we develop, and how we inspire people. Without strong engagement and a positive, meaningful work environment, people will disengage and look elsewhere for work” ”
Global Human Capital Trends 2015
Deloitte

Finally, keep company values front and center by communicating them early and often, and consider giving new hires some sort of visual or presentation that they can refer to.

Boost Productivity with Better Onboarding

Helping your employees feel more engaged with your company is one of the best ways to boost retention rates. Madeline Laurano’s study, The True Cost of a Bad Hire found that organizations with a robust onboarding process were likely to improve new hire retention by up to 82%, while companies with weak onboarding programs were more likely to lose the confidence and interest of their candidates within their first year. But increased employee engagement has been linked to numerous other benefits as well. High employee engagement has also been directly linked to increased productivity and profitability–and since we’re all looking for ways to boost productivity, employee onboarding is a great way to start laying the foundation for high levels of engagement.

According to a survey by Gallup, team engagement and levels of performance were strongly linked across 82,000 teams in 230 different organizations, despite vast differences in industry and nationality. In fact, companies with strong onboarding programs often noticed an increase in productivity of up to 70%. While it will always be challenging to predict team performance accurately, the results suggest that “businesses that measure and manage [engagement] elements can increase performance – and improve their chances of success.”

Gallup also found that there are several significant factors of employee engagement that companies should consider, especially in regards to boosting productivity over time. These areas included: clearly defined job roles, regular development opportunities, employee feedback, strong coworker relationships, and a joint mission or purpose. Businesses that incorporate these things into the structure of their onboarding “have better odds of achieving the outcomes their organizations want such as revenue, profit, and productivity.”

The Bottom Line

Building a great employee onboarding process isn’t just another box to check—it’s something that has a long and meaningful impact on the bottom line of a business. From the moment a new hire says “yes,” you’re building the foundation for an enduring and productive relationship, and data from countless studies supports that.

Want to reduce churn, increase engagement, and skyrocket productivity? A new onboarding process just might be your secret weapon.

Want to easily build and scale a better people-centric onboarding process? Donut can help.

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