Accuchex Blog

The Business Case For Onboarding

Posted by Leslie Ruhland on Jan 31, 2019 6:45:00 PM
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Onboarding of new hires is a commonplace practice among most every company. However, effective onboarding with both desirable and measurable results is sadly lacking in many organizations.

Most business owners, managers and HR professionals would likely agree that how a new employee is brought onboard into a new company is important. The orientation and transition process is needed to help the new hire become accustomed to both the company and their role within it.

Yet, there are many who are inclined to discount the value of investing more than a few hours, or days at most, to this process. However, given the vast amount of data supporting the multiple benefits of having a comprehensive and effective onboarding process, a business case for doing so can easily be made. 

Onboarding, New Hires, and Retention

Probably the most apparent benefit that both experience and surveys have established is the impact of good onboarding on employee retention, or loyalty. So much of what is imparted and established with a new employee during the first six to twelve weeks determines the likelihood of long-term retention and the level of employee engagement. 

The Gallup organization notes that,

"Gallup finds that only 12% of employees strongly agree that their organization does a great job onboarding new employees. This failure gets in the way of the formation of an emotional bond between the new hire and the company -- a connection that can make or break retention.

According to the Society for Human Resource Management (SHRM), employee turnover can be as much as 50% in the first 18 months of employment. Employees leaving the workforce can be expensive and put pressure on highly burdened resources as well as a company's financial bottom line."

And the cost of replacing employees can be damaging, especially for smaller companies. SHRM has estimated that it can cost a business from six to nine months of an employee's salary to recruit, hire and onboard a replacement. And, for some, the cost to be much higher.


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New Hire Onboarding Shouldn't be Overlooked

Aside from the common situation of businesses with no process at all, many companies have no documented process or written procedures for bringing new hires into their new job and workplace.

A survey by OfficeTeam reported than over 50 percent of employees said they experienced at least one significant problem in their onboarding experience. The survey offered some typical examples:

  • 33 percent: Work space technology was not set up properly
  • 22 percent: Necessary supplies were not provided
  • 16 percent: No overview of the company's structure and policies
  • 15 percent: Were not introduced to their new co-workers
  • 14 percent: Not given a tour of the workplace

Yes, 92 percent of the HR managers surveyed believed that their onboarding processes were "somewhat to highly" effective!

A number of statistics work to show the value of effective onboarding for both the immediate and long-term benefit of a company.


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Take Time to Develop an Onboarding Process

Every business believes that their employees are their most valued assets. This is why it is critical to devote the time and invest the labor and expense needed to develop, document and implement a comprehensive and employee-centric onboarding process.

A post at the SHRM website agrees:

"Finding the best candidates for positions in your organization is only part of building an effective team. The process of onboarding new employees can be one of the most critical factors in ensuring recently hired talent will be productive, contented workers.

However, in some organizations, onboarding is often confused with orientation. While orientation might be necessary—paperwork and other routine tasks must be completed—onboarding is a comprehensive process involving management and other employees that can last up to 12 months."

Your HR Management Partner

In addition to a growing and demanding role in recruiting, hiring, and continually training employees, the HR staff is responsible for other functions such as payroll management, tax filings, employee records compliance, and so forth.

Considering alternatives such as outsourcing is increasingly becoming a cost-effective and strategic option. Accuchex can help you in managing your HR needs, payroll processes, and staying on top of compliance demands. Get your Free Download: Payroll Outsourcing Guide to help you make an informed decision or call Accuchex Payroll Management Services at 877-422-2824.


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Topics: employee onboarding process, employee onboarding, employee turnover, employee engagement, new employee

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