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Good Hiring? Bad Onboarding? It’s Going to Cost YOU

Good Hiring? Bad Onboarding? It’s Going to Cost YOU

Hiring in most companies is a sign of growth and the need to improve. However, sometimes hiring is also done to replace non-performing staff. Finding a new employee is no walk in the park, as you have to go through several layers of screening, vetting and interviewing before selecting the right candidate.

If you are a keen recruiter or human resource manager, you will gladly take the time to hire well. But what happens after the candidate is hired is as or sometimes even more important than the hiring process itself. This detailed article will explore:

  • What onboarding is
  • The cost of poor onboarding
  • Its impact on your organization
  • Common areas where onboarding goes wrong
  • How you can improve your onboarding process

Let us begin.

What Is Onboarding?

Onboarding is the integration of a new employee into a company. Onboarding comes after hiring, and it’s critical because it is this process that allows new hires to gain the skills, knowledge, and etiquette required to become an effective employee of a given company.

Through onboarding, new employees understand more about the company, their duties, fellow workers, core values, and the organization’s mission statement. They are also taught about the systems of the organization and its culture. Generally, the process comes in these three categories.

  1. The organizational: In this category, the employee is guided on the company’s culture, work structure, processes, and goals.
  2. The social: this helps the new employee learn how to relate with other employees, trust them, and create a communal sense at the workplace.
  3. The technical: This category is more about the employer’s expectations from the employee, and leveraging the systems through which success is achieved at the company.

This is not a one-day event and can take up to a year, which reinforces the fact that you cannot take this lightly. Integrating new employees requires a serious and detailed onboarding program. Unfortunately, most human resource professionals only focus on good hiring, where onboarding is simply an afterthought. But good onboarding is one of the most effective ways to increase employee retention, which in turn reduces the need to constantly hire new employees.


The Cost of Poor Onboarding

The main cost of poor onboarding is a high employee turnover rate. According to the Harvard Business Review, 33% of new employees start searching for other employment opportunities six months after being hired. Also, a considerable 33% of new hires don’t stay with the organization for more than one year.

Not to mention that the cost of replacing an employee is 20% of that employee’s salary. Thus, you can see how a higher turnover rate within a given job position will cost a business many multiples of the position’s salary.


Keep this in mind when considering how much to spend on onboarding, as a good onboarding process should be cheaper than the cost of replacing an employee. Let us now dive deeper into the true cost of poor onboarding and how the loss of employees can negatively affect your company.


The Impacts of Poor Onboarding

There are several consequences that an employer will face if they don’t have a good process for integrating new employees. Even these new employees will have their share of the consequences. Let us explore each consequence.


Higher Cost of Training

Serious employers will work towards developing their employees. This is done through training and mentorship programs. However, this costs money and oftentimes doesn’t produce an immediate return on investment, which is why some employers avoid investing in such programs.


But here’s the problem with that kind of thinking: when you fail to develop your employees, you will often lose them anyway. And to bring others on board you will be forced to spend more, not just on hiring, but to train them on the basics of the company’s systems as well. Which do you prefer? Investing in your employees and keeping them over time? Or constantly starting from scratch and having to pay to get new people up to speed?


Poor Customer Service

This is another one of the huge negative consequences of poor onboarding. New employees need to take their time to master the systems of their new company. You have to factor in the fact that they will take much longer to solve problems than experienced employees, in the beginning that is.

This, in turn, will affect the quality of your customer service, which is one of the main pillars of any business. Poor customer service leads to lost customers. One of the key measures of customer service quality is wait time. Customers are not willing to wait around for long stretches of time just to get a proper response from your employees. In summary, not investing in proper training for new employees due to high turnover will result in your company’s reputation being damaged.


Low Productivity

When new employees are trained to do what is required of them, they will become a value add to your company. This means that their contributions will lead to increased productivity. On the contrary, if the new employees aren’t trained and guided on their new position, their confidence will be low, and directly decrease the company’s productivity.

Since poor onboarding ultimately leads to higher employee turnover, the company will inherently become less productive. Having less staff lowers productivity since the workload will be much higher for the remaining employees, to the point where they probably will not be able to reach their expected targets. This directly lowers your bottom line.


Cultural Impact

So far we have mentioned some of the immediately visible consequences of high turnover. However, company culture is one of the less visible areas that also takes a hit.

When employees leave, that subsequently lowers the morale of those left behind. According to a study done by Hubspot, 70% of workers who have a friend at their workplace are happier and more connected to the company. As you can see, these elements of trust, confidence, friendship, and morale also play a significant role in employee retention.


Additionally, high employee turnover makes a company feel unstable. This leads to the remaining employees feeling insecure and uncertain. As a result, they will refrain from exploring new performance improvement ideas and lose their connection to the company’s mission. This obviously suffocates the company’s growth, and reduces its likelihood of achieving certain goals.


High-Stress Levels Among the Employees

You might have an idea of what it feels like to be anxious in a new job. Even more so during the first days when you fear not delivering as per your employee’s expectations.

This is the same feeling that your staff will have if you don’t integrate them properly. They will struggle to grasp the scanty information you give them, thus making it difficult for them to bring out their best. This will result in stress, in addition to:

  • Poor focus
  • Poor time management
  • Poor health
  • Poor interpersonal engagements

As much as a given hire might have been excited to land the job, they might resign soon after due to the above issues.


Potential Loss

Naturally, every new employee desires to give their best and prove themselves immediately after being hired. Unfortunately, that is not how things usually work.

Oftentimes, it takes new employees at least eight months to one year before they can perform at their peak level. If you notice lacking performance from your new hires before the lapse of this period, chances are they haven’t maximized their abilities. However, this learning curve can be drastically reduced with a good onboarding program.


All in all, these are the consequences of poor onboarding. Employers need to understand that it is cheaper to retain their employees than hire new ones. They should be committed to making their new hires well-rounded people, increasing productivity, and reducing the likelihood of employee turnover.

Do you have a company you are running? Plan a training and mentorship program for your employees to be successful. Also, scarf a bit of the time out of your busy schedule to follow your company’s daily happenings. Find out what challenges your employees might be facing and whether they have access to the right resources to deal with these.


Where Does Onboarding Go Wrong?

Poor onboarding has a negative effect on your company and hinders employee productivity, not to mention all the other effects we have described above. The last thing an employer wants is to hire people who will leave in a few months, forcing them to go start hiring again. So, where exactly does onboarding go wrong? Here are the most common mistakes that employers make.


Orientation Instead of Onboarding

Onboarding is deeper than orientation, but unfortunately, most employers don’t understand that. They hire and orient new employees and leave it at that. Orientation is narrow since it focuses mostly on the benefits and providing basic information about the company. Conversely, onboarding is concerned with giving knowledge about the company’s culture and values and providing the right resources to the employee to be fully integrated into their new job. Therefore, as an employer, you should focus more on onboarding than orientation.


Leaving New Hires After Giving Them Job Offer

Hiring alone is not enough, and most employers don’t know the importance of walking with their new hires. You must take the first few days to prepare your new staff for the position you have given them. Let your employees know how they are expected to dress, relate with other employees, park their cars, who they should report to, and scope of business hours, among other things. Be keen to ensure they adjust and settle into the new work environment.


Giving Too Much Information to New Employees.

Have you ever started a new job and felt like you’re suffocating due to being fed too much information? That’s how new employers feel, and it’s a common mistake. When you give too much information to your new staff, they tend to forget easily, and they also won’t be ready to ask questions as they haven’t fully digested the information. The best way to onboard is to limit the information and instead make the new employees feel warm, and that they made the best possible decision by joining your company.


Ignoring The Onboarding Activities

Employees should make their new hires feel easy by conducting a pre-onboarding session. This works as a foundation and will start them off well. Some pre-boarding activities include culture, products or services, teamwork, and assigning new hires to the existing employees for mentorship and learning of the company’s system. This will make them feel excited and easy when engaging with other staff, and most importantly, they will feel that they belong to the organization.


Unorganized Onboarding Teams

As mentioned earlier, onboarding is a detailed process and should not be rushed. If you don’t have a competitive team to run the process, things will not work out well. Your onboarding team should be excellent and organized in ensuring that everything goes well. This includes properly registering the new hires into the payroll, assigning them to their respective office, setting the technology up for them.


Lack of Digitalized Onboarding.

Times have changed, and organizations must embrace the technologies of today. For the best onboarding program, it would be wise to have all the necessary information online. This way, it will be easily accessible before and after hiring. When new employees have everything they need within their reach, they will perform more effectively and quickly.


How to Improve the Onboarding Process?

The onboarding period should be an exciting time for new employees. On the contrary, new hires are often full of uncertainty, anxiety, and stress. You can improve things for the better by following these tips.


Connection Building

One of the most effective ways of retaining employees is by building connections. Creating a friendly environment is critical and ensures the employees are comfortable. Offering mentorship is the best way of building connections. The mentors should support your new hires and create an ongoing learning and talent development platform. It will be easy for your employees to bond, engage, ask questions, and share their problems and experiences through the connection. These connections will lead to employees staying on for longer and being more productive overall.


Conduct Proper Orientation

Confusing onboarding with orientation is a mistake that most companies make. As mentioned earlier, the two have different aims and methods. However, while orientation is not as deep as onboarding, it should still be done properly. This is because it will make the onboarding process easier and more effective. Ensure that your employee orientation does the following:

  • Give new employees an outline of the organizations’ goals and missions.
  • Provide an overview of the organization’s culture, expectations, and etiquette
  • Provide new employees with the necessary resources, including a phone, computer, email address, among others.

It can be easy to forget to include remote employees in the orientation and onboarding process as well. Don’t make that mistake!


Offer Personalized Training

People are different, so training resources should not be one-size-fits-all. Some people grasp new guidelines quickly, while others take their time. That’s why you should offer training resources that cater to each individual’s strengths, preferences and challenges. In other words, give each new hire materials that match their specific position and assignment.


Socialize During The Onboarding Program

The fact that you’re offering a professional position doesn’t mean that it has to be strict and boring. Socialization is key to improving the onboarding process. Many workers say that it is a huge challenge to make friends at the workplace during the first few weeks or even months.

Nevertheless, you can change this by encouraging the existing team to socialize with the new hires. As they get to know each other, they will begin to connect to the company’s culture. You can even, for example, plan for a lunch where the new employees can get to know the company’s managers, supervisors, and the rest of the team.


Request for Feedback

Asking for feedback will help you know whether the onboarding process is successful or not, which the human resource team will greatly benefit from knowing. This will, in turn, lead to making talent and task management more efficient. There are many ways to request this feedback, too. You can do so, for example, via surveys, or during an employee’s first performance review. Storing this data online, and not simply on a notepad, is crucial. Why? So that other HR professionals can also explore these results and work on improving them.


Encourage A Managers and New Hire Relationship

Being in charge of the new hires is one of the most important tasks of any manager, which is why a new hire’s manager should be highly available during onboarding. Being a supportive manager will help the new employees understand their roles clearly and satisfy their assignments.


A new employee’s manager should also share the goals they expect new hires to achieve and set timelines based on their learning curves. Managers can help new hires become successful by measuring how they are doing, which includes the tasks they are getting done and the time frames within which they are doing so. They should also show appreciation whenever they can by providing them with kind words.


Setting Up the Office Ahead of Time

If you don’t adequately plan for the arrival of a new hire, you’ll be in for a world of headaches. It would help to prepare their office and tools before their first day. This might seem like a simple thing, but it greatly impacts the onboarding process by giving the new employees a seamless experience.


Create Onboarding Templates to Automate Paperwork

Doing paperwork for new employees can be hectic and time-consuming. Even more so if everything is being done manually. Below are the two most critical forms for new employees that you must submit.

  • Form W-4: This is the form that employees fill to enable their employers withhold the right federal income tax amount.
  • Form 1-9: This is the form they fill to prove that they are eligible to work in the USA.

Other documents that new hires are supposed to fill include compliance forms, non-disclosure agreements, and other paperwork depending on the management structure of your company.


Provide Training Materials

The onboarding process can’t be effective if you don’t offer training material to your new hire. Giving them the tools will enable them to learn things faster. Take advantage of the fact that most people like watching videos instead of reading, so you can keep the new hires more engaged.


Key Takeaways for Improving the Onboarding Process

For the longest time, onboarding was seen as a single step to be taken, rather than a process. It used to be that the new employers were briefly oriented in a day or two and left to go about their work.

Unfortunately, that is not enough and has left many companies having to pay the cost of high employee turnover later on. Large companies would have to spend millions on training new hires. To avoid this, organizations have to embrace a good onboarding process. This will help your new employees learn the companies’ culture, systems, and etiquette, thus quickly bringing them up to speed.

Now that you’re aware of the costs and negative consequences of poor onboarding, you can design a better process that keeps employees happy and productive, which every company should strive to achieve.