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Why do Companies Fail in Onboarding?

Why do Companies Fail in Onboarding? Five Common Problems

Considering all the time, money, and effort that companies put into interviewing, assessing, and hiring candidates, it may shock you to find that only 32% of companies have a formal onboarding process in place (Aberdeen Research). Laszlo Bock, the former SVP of People Operations at Google, highlights this challenge in his book, “Imagine Ivan, a salesperson who earns $60,000 per year. Ivan costs $5,000 every month until he starts selling, and even once he’s selling, it takes time until his productivity exceeds his cost. He also consumes training resources and the time of the people around him whom he’s pestering for advice.”

Despite its imperfections, onboarding is hugely beneficial for attracting and retaining employees. Organizations with a strong onboarding process improve new hire retention by 82% and productivity by over 70%. But, Gallup found that only 12% of employees strongly agree that their organization does a great job of onboarding new employees. That means 88% don’t believe their organizations do a great job regarding the process. What goes wrong exactly?

Here are five common problems with onboarding programs.

1. Your onboarding program is too short

According to onboarding researcher Talya Bauer, Ph.D. of Portland State University onboarding is, “the process of helping new hires adjust to social and performance aspects of their new jobs quickly and smoothly.” In other words, onboarding is a process, not a one-time event. Onboarding is not a 2-hour presentation about company policies, or it’s not a one-day orientation dedicated to company culture. At most companies, the “onboarding” process doesn’t last more than a week. In reality, studies indicate it takes approximately eight months for an employee to become fully productive. The result is that new hires were feeling confused, discouraged, and lacking resources to become productive.

A week is not enough for a new hire to adapt to the company, its culture, and its roles. The best employee onboarding programs usually extend throughout the employee’s first 90 days (or more) to ensure new hires are fully supported as they become new coworkers.

The whole process can also be digitized. For example, Vodafone decided to digitize all new employees’ onboarding to plan each employee’s first 90 days and offer them the right experience at the right time. Vodafone used Journey in the onboarding process of all new employees. One of the two ideas that stand out in user reviews was that the employees “hardly experienced any confusion or uncertainty thanks to Journey. It was clear from the very first day what they were going to do and how they were going to do it”.

2. You do not involve managers in the process

Vipula Gandhi, a managing partner at famous research and consulting firm Gallup, recommends focusing on involving managers in the process. “Managers are the linchpin in an effective onboarding,” she says, “When managers take an active role in onboarding, employees are 2.5 times more likely to feel that the process was successful.”

According to a Forbes article, some of the “duties” of the manager on the first day include discussing the employee’s specific responsibilities, department objectives and the structure and roles with the company, sharing with employees how their positions fit into the organization and how these roles contribute to the company’s success.


3. You have no idea if it’s working or not. No feedback.

Most managers don’t know their onboarding is broken until they’ve already lost a crucial employee. A systematic approach can fix that. Companies can use pulse surveys and regular manager check-ins during the first 90 days to receive feedback and identify pain points before it was too late.

Companies must also utilize rigorous and consistent methods of measurement to identify the effects of onboarding practices.

Best-in-class companies track:

Short-term retention. One Fortune 500 company sets a six-month turnover rate as a KPI for onboarding.

Time to proficiency. Reducing the length of time it takes for a new hire to reach full productivity is a top onboarding goal of a company.

Greater investments in onboarding are justified when HR leaders can prove new programs’ value to business outcomes.

New hires often need feedback and guidance during the onboarding process. Feedback is a two-way road: New employees can both give and receive feedback. Common approaches to employee feedback are performance appraisals and 360-degree feedback and employee-initiated information, and feedback-seeking. Genuine feedback can also allow you to make your onboarding better. And, it’s good to know that millennials request feedback 50% more often than other employees.

4. You limit the onboarding program only to new hires

As your business evolves and your staff changes roles, it is essential to keep the onboarding process going. Brian Kropp, group vice president of the HR practice at Gartner, says that organizations should not limit their onboarding programs to new hires. Still, they should also provide employees with programs after extended leaves and internal moves and promotions, if necessary. “If someone is shifting to another part of the organization or taking on a significant shift in their role, it is a mistake not to onboard them again. Not doing so will set those internal transfers up to struggle, underperform and potentially quit,” he says.

5. Your onboarding is not personalized

According to research from Francesca Gino and her colleagues taken from Administrative Science Quarterly, an employee-centric onboarding program that focuses not just on the company but also the employee results in more excellent employee retention and customer satisfaction. Everything from name tags to personalized tools to group exercises that emphasize a new hire’s welcome can be beneficial. Gino and her colleagues stress that “employees who receive onboarding emphasizing individual identity were more than 32% less likely to quit”.

New hires usually experience onboarding as a mix of anxiety, excitement, and not knowing what will happen next –even more in a remote onboarding after Covid-19. You can turn these feelings into happiness and contentment with personalized and structured onboarding.

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