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The Importance of Onboarding: A Guide to Ensuring Your New Employees Succeed—and Stick Around

In today’s economy, companies that are serious about retaining the best, most talented employees know that investing time, energy and resources into a great onboarding experience pays off.

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Many of us have experienced anxiously preparing for our first day at a new job. You try on a flurry of outfits as you decide what to wear, you stay up late scouring the internet for last-minute information about your new workplace, and you agonize over what to say and do when you meet your new colleagues. Understandably, you are eager to make a good first impression. You want your new boss and coworkers to know beyond the shadow of a doubt that you have the talent and energy to do the job.

But what about the first impression your new employer makes on you? Should businesses be just as concerned about starting off on the right foot with their new hires?

The answer is a simple but resounding yes. In today’s economy, companies that are serious about retaining the best, most talented employees know that investing time, energy and resources into a great onboarding experience pays off. As Anne Mulcahy, former chairperson and CEO of Xerox Corporation, once stated, “Employees are a company’s greatest asset. They’re your competitive advantage. You want to attract and retain the best; provide them with encouragement, stimulus and make them feel that they are an integral part of the company’s mission.” Successful businesses realize that bringing employees into alignment with that mission begins on day one.

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A well thought-out onboarding experience can be the key to giving employees an enduring impression that their new job is about more than just a paycheck. It shows them that they have found a happy culture in which to thrive and advance—a place where their efforts have a higher purpose. Here, we explain why effective onboarding matters and offer some best practices companies should consider when crafting an onboarding experience to make a great first impression.

Why Onboarding Is Important

With the market flush with talented job seekers, voluntary turnover has become a serious problem. In one study, Gallup found that the cost to replace a single employee ranged from one-half to as much as two times that individual’s annual salary and that businesses on the whole were losing $1 trillion every year as a result of voluntary turnover—and that’s in the United States alone. That’s a lot of lost revenue, and one can only imagine what the global figure might be. The root cause of most of that loss was found to be company cultures that don’t adequately support employees.

According to Brandon Hall Group, companies that have established a robust onboarding process see an 82 percent improvement in new hire retention and more than 70 percent improvement in productivity. Conversely, companies that neglect onboarding or perform it poorly run a higher risk of losing new employees during their first year at the firm. Research has shown that 90 percent of employees decide within their first six months at a new job whether they will ultimately stay with the company or not, so we can easily see how having a strong onboarding process can lead to significant cost savings, even in the short term. An added bonus is that businesses with less turnover tend to have more positive work cultures.

When onboarding is done well, 69 percent of new hires are likely to remain with the firm for several years, and 58 percent of employees who experience a “structured onboarding program” tend to remain with the company for more than three years.

Starting Before Day One

One way to help your new employees feel less anxious and more valued from the outset is to make sure all human resources–related paperwork has been completed before they arrive for their first day of work. That way, the employee can spend their first day focusing as much as possible on building new relationships, familiarizing themselves with the company culture and developing a better understanding of the firm’s mission, vision and values. Send any required forms to the new hire via a welcome email at least a week before they start so they can complete it at their leisure and include incidental information that might be helpful, such as where to park and what amenities are provided at the office (i.e., coffee, gym, café).

Also, make sure that your new employee has a dedicated workspace that has been fully prepared before they come to the office on day one. Companies with a healthy work culture and satisfied employees cultivate an atmosphere of “work as a second home.” Seize the opportunity to immediately create such an impression for your new hire. Encourage the new employee’s coworkers to enhance the experience by decorating the space festively or leaving welcome notes to surprise the person when they arrive.

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Some companies provide their new employees with welcome kits containing items that are useful, informational or just plain fun. Salesforce, for example, mixes practical items and business materials with a Nerf gun—so the employee will be instantly ready to join in the company’s “Nerf gun wars” between departments. Such a gift speaks volumes about the kind of company culture the employee can expect, while effectively communicating the values of joy, teamwork and belonging.

From the First Day Forward

Anyone can pull together a basic first-day onboarding packet that includes checklists of policies and procedures. But to create a more fulfilling onboarding experience for your new employees, you need to focus less on communicating rules and more on how you want those new hires to feel at the end of the day. Your top priority should be making them feel comfortable and connected. Onboarding is a time when new employees subconsciously decide whether or not to engage with their new firm, and the advantages of having engaged employees have been well documented. A welcome lunch with a select, not overwhelming, group of team members is a good way to break the ice a bit. Obviously, your new hire will have procedures to learn, but their day one should be about giving them a warm reception and an instant community.

Another good way to facilitate connection is by recruiting the help of certain people to interact with the new employee from the outset. Consider assigning the new employee a dedicated workplace buddy—someone in a similar position who is a good model of the company’s mission and values. This individual can stick with the new hire until they are comfortable with the basics of the job and have begun to create a social network.

To complement the buddy’s role, supervisors and more-tenured employees can act as coaches, giving the employee the technical capabilities they need to be successful in their new role. This training should also show the new employee how their unique talents fit into the overall function of the team. Validate for the employee the reasons they were hired for the position rather than someone else.

Executives and other high-level employees should adopt the role of mentor and take time to engage in the onboarding process as well. Why? Such mentors can give the employee a bird’s-eye view of what long-term success in the company looks like and fill them with a sense of pride about being part of the organization’s mission.

Injecting as much excitement and energy into the onboarding process as possible can be helpful. This can be easier to facilitate by onboarding several new employees at once. Zappos has a high-energy, four-weeklong onboarding program that all employees—even its CEO—complete. It combines training with planned group activities and ends with a fun graduation ceremony. Although not every company can afford to implement an onboarding program with as generous a time frame as four weeks or to host a graduation party for its new employees, even small organizations can adopt the core principles behind the Zappos effort: ensuring the employees’ comfort, celebrating their addition to the team and giving them a preview of why a career with the company is rewarding.

 From Onboarding to Opportunity

Although your commitment to your new hire’s career with your company begins with onboarding, it should definitely not end there. To retain the best talent, you must ensure that your employees know from the outset that they will always be able to learn new skills and step into new roles within the organization. Keep in mind that such opportunities will likely require investing in further onboarding as employees assume more advanced roles.

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Encourage your team members to develop new abilities that match their talents and interests, and show your appreciation for their drive to continue learning and improving. Also, allow them to work beyond departmental boundaries, as appropriate. When you give employees a little wiggle room to find their best fit in your organization, they will repay you with loyalty and a longer tenure. All your career development efforts will in turn inspire employees to pay it forward and mentor others who join the company in the future.

Inspiring Ongoing Motivation

No matter how qualified a new employee might be, beginning a new job is daunting. If you are hiring new team members because your company is desperately busy, you might be tempted to rush through, if not entirely bypass, onboarding so they can hit the ground running. The prospect of piling their desks with work and postponing the onboarding process until you can deal with it properly can be difficult to resist. But resist! Otherwise, you risk giving your new workers the impression that they are merely hamsters on a wheel, which is extremely demotivating. Demotivation represents not only a great opportunity cost, but also the actual cost of lowered productivity and a lost competitive edge.

Making your new employees’ first day on the job all about highlighting your company’s culture, their unique place in it and your collective excitement about having them on board will reap great dividends in the end. The support, encouragement and inspiration of a well-designed onboarding system provide a deepened level of engagement and intrinsic motivation that are key to the employees’ long-term success—and to yours. Let every day of the onboarding period give your valued newbies another reason your business is the best place for them to build their career.

Rachita Sharma is a technology entrepreneur, financial literacy advocate and gender rights activist. She is the CEO of Girl Power Talk, a purpose-driven organization empowering today’s most capable youth with the confidence, knowledge and opportunity to become tomorrow’s global leaders.

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