Nearly one in three newly hired employees leaves voluntarily or involuntarily before the end of their first year. What's more, 22% of staff turnover, occurs within the first six weeks of their start date. So something about the first impression we're making is going wrong. And it's not a cheap mistake to make.
Counting the cost can be eye-watering. A PwC survey from 2010 estimates that failure to retain talent costs UK firms 42 billion a year. To put it another way, losing an employee in their first year can cost your organisation up to three times their salary. This is made up of hiring costs for them and their replacement, including people's time for interviews, etc., as well as costs for their training, facilities, systems and tools and any benefits paid out to them during their employment.
Aside from the hard costs associated with it, high staff turnover can also impact staff morale and organisational and team culture. It's also the case that many recruit not only to fill a gap and to ensure business needs can be met, but also to bring in fresh blood and ideas into an organisation. So whatever way you calculate it, losing people is costly. It's absolutely in all our interests to ensure we nurture and retain employees, particularly in that first all-important year.
What's training got to do with it?
So where does onboarding fit in with this? Well, Aberdeen consulting in the US argues that those who do onboarding will retain 91% of employees, as compared with 30% of employees at laggard organisations. It might not be the sole saviour of staff retention, but this statistic makes a very strong case for bringing people onboard effectively. Whether you call it induction, new hire orientation or onboarding - just make sure you do it right.
Yet only 37% of companies invest in formal onboarding programmes, with half of those lasting less than one month. Many last for just one week, or in some cases, a single day. With so many employees deciding to leave within their first six weeks and within the first year, there's a clear correlation. It stands to reason: if you're not being welcomed, taken care of, motivated and supported in your earliest stages with a new employer, then the risk of you leaving increases. And that's homeland territory for learning professionals. We can help to solve this problem. Arguably alongside compliance, getting the new hire learning experience right is the most important thing we do.
We say that onboarding is a must-do for any organisation. And we say it's not a one-hit experience. Ideally it should last up to a year, and as a minimum, we would say it needs to support people in those important first 100 days. But length is obviously not the only factor, it's got to be about quality. As the Aberdeen report indicates, it's the quality of onboarding that makes or breaks its ability to impact staff retention.
What's onboarding for? Depends who you ask...
So what does good, or great, look like when designing onboarding?
When we talk about quality of training and engagement, it makes sense to look the needs it is meant to be delivering against.
For organisations, the business case for creating onboarding programmes is a strong one - they need to recruit and retain (good) staff. But on a practical level, organisations also need to get new employees up to speed and fast.
It might be helpful here to contrast two points of view: what the organisation wants to achieve in onboarding and what the new joiner needs. Those are not necessarily the same thing.
The organisation primarily wants:
- Minimum time to competence: An organisation needs to get new recruits up to the required competency levels as soon as possible. After all, they've hired someone to carry out a role and they need them to fulfill it. This may include competently using systems and tools, applying process and procedures, effectively working as part of their team, as well as applying the relevant skills and knowledge to carry out their role. But it might also be about getting new staff to a place where they can function without day-to-day support - after all, intensive training, coaching, and buddying are costly, right?
- Minimum time to compliance: Organisations also need to ensure new staff are compliant, from a regulatory or legal perspective. They need to make sure you'll do no harm, not miss-sell a product, not cause an accident, and so on. They also want to make sure you are working clearly within company policies and guidelines. HR policies and information on matters such as holiday entitlement, expenses, paternity leave, performance and or/probation review procedures etc. are important - you need employees to know how to function within the organisation on a practical level, and they haev the right to know where they stand. On the other hand, you also, probably, don't want to tie up people's time answering questions on such matters.
Of course organisations also want people to feel welcome, motivated, excited, that they're developing - but those things are seen as somewhat fuzzy compared to the two primary drivers above. That can come later. But perhaps here's what the problem is.
What does the new hire want?
The new hire to the organisation wants to be compliant, sure. Nobody wants to get into trouble on their first day. They also want to be competent and perform well. Because we all want to be thought well of. But if this was Maslow's hierarchy of new hire needs, would these be the most primary? We think not. You're not likely to come home and say to your partner when asked how your first day was, "This place is great. I'm really compliant. And I'm well on my way to memorizing a lot of processes and procedures which I look forward to implementing as soon as I have a context in which to do so."
A more likely - and we'd argue more desirable first response to the onboarding exercise is:
"It's great. I really like the feel of it."
"People are friendly. I've been buddied up with someone who does the same role."
"I didn't feel foolish for asking questions, and there's some great training lined up."
The needs and success factors for an individual are likely to be quite different to the practical needs of an organisation. By the ened of someone's first week in a new job, it's likely these will be the important factors:
- I understand what's expected of me in my role
- I've met all my team and can tell you a little about them
- I know where to go for help with questions and how to find practical guides etc.
- I feel a connection (with it/someone)
- It feels like I've made the right choice
- I have a sense of the culture, and I like it
And maybe a little later down the line:
- I feel like I belong
- I feel like I'm valued
- I am satisfied with my job
These are all the Feelings of belonging and potential, rather than evidence of performance or compliance. That's a very different way to approach the onboarding challenge.
What happens when we as designers or commissioners of onboarding learning experiences leave out the 'F' word?
- We bombard with facts and information when there's no context
- We talk about compliance and expectations when it's too soon and we end up scaring people
- We talk about the organisation, our size and history and strategy, more than we talk about what you mean to us in joining the organisation and you future
- We don't listen and connect with new joiners
- We don't empathize - it's like we've forgotten what it's like on your first day
How do you design to achieve that positive feeling and sentiment?
By designing onboarding with empathy.
In a future onboarding guide to be released in June 2014, we'll share advice and guidance on the best practices involved. But before we get there, ask yourself the question: Are you on the same page as your new joiners? Do you remember what that first day was like? Are you approaching your onboarding from that place?
If not - you're missing a great opportunity to create an honest, and empathetic, first impression.