Is an Effective Onboarding Program the Answer to Retaining Top Talent?

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Retaining new employees should be one of the main focuses of an organization; especially with the ever-growing demand for talent. However, not all companies prioritize the necessary actions that need to be taken in order to improve their retention rate. One of the most effective ways to reduce turnover and increase retention is by having a well-structured onboarding program.

Retention Who?

Companies are aware that people are their best asset; however, they’re all talk when it comes to taking action in this regard. Just a small number of organizations care enough about retention to actually do something about it. In fact, according to the Resourcing and Talent Planning survey led by the Chartered Institute of Personnel and Development, more than 80% of companies haven’t been able to retain members of their staff in 2016, and just 40% actually did something about it.

Nowadays, a company’s success depends on the talent they bring in, which is very scarce to begin with, so when they finally catch a big fish, they have to make sure they don’t release it before time, or at all. When you lose a great employee, the company does not only lose a great asset, but also a big chunk of money. To put it in numbers, the Society for Human Resource Management (SHRM) says that in order to replace an employee and train the new one, six to nine months’ salary of the former employee is required.

Employee retention does not only help save some big bucks, but also a great amount of time. According to the SHRM, it takes a company approximately a month and a half to fill an open position. So, imagine spending about three months–and about $30,000 to $60,000–trying to hire someone because you weren’t able to retain the first hire.

But what causes low retention rates or, in other words, high turnover in companies? There are many factors involved in this answer, including lack of training, unfulfilled expectations, insufficient salary or lack of benefits, too much pressure from managers, bad management, long commute, lack of motivation, no opportunities to grow within the company, bad work environment, among others. However, there is one factor that can be the cause for most of the others: a bad onboarding experience.

Riding the Onboarding Train

Imagine stepping foot into your new office, being swamped with forms and paperwork, having a person from HR blab for an hour about rules and conditions, and then being left at your desk like a stray puppy. We would even dare to say that most people have gone through a similar situation on their first day at a new job.
When a company just leaves employees to their own fate during their very first day, chances are at least half of them will leave the organization in a short period of time. New hires, as well as employees that have been promoted, should be part of a standard onboarding program as soon as they step foot into their new positions. A study from Kronos and the Human Capital Institute, New Hire Momentum: Driving the Onboarding Experience, states that the three P’s, “people, performance, and paperwork are three key components that are part of an onboarding program”, and that both the company and the HR department should address this program strategically.

Onboarding has to go beyond just filling out paperwork and forms, it has to be the stepping stone for new hires, allowing them to get to know the organization and its culture, values, and mission; meet their coworkers; clarify their tasks and responsibilities; make the transition as smooth as possible, especially when it’s an internal hire; and make sure they know all the resources available to them.

The Kronos study goes on to say that “when successful, onboarding programs reduce turnover, shorten time to proficiency, and increase productivity and employee engagement.” Isn’t that a dream come true for any company? The study also mentions that the best way to apply an effective onboarding program without over-tasking managers and supervisors is to create a multifunctional team and to divide the onboarding duties between them. Maybe rotating a “welcoming committee” with one supervisor from each department who volunteers to help might be a great idea to mix things up.

Onboarding Done Right

Effective onboarding programs don’t only reduce turnover, but they also create a strong employer brand. So, there’s really no downside to the process, then why aren’t more companies doing it? Most HR departments don’t have enough time and resources to successfully carry out this process and it goes without saying it’s the same case for the process of measuring the effectiveness of the onboarding program, so they can’t actually know if it worked or not.

It’s up to you to change your onboarding practices for the better by finding a balance between the three P’s and putting more attention and effort in the onboarding process, as well as a little more budget, which can definitely come from what you’re going to save after reducing your turnover rate.

Vanessa Fardi
Digital Copy Editor