Employee onboarding is an often overlooked process that can make or break great teams. To better help you tackle optimizing your own process, we've put together an employee onboarding checklist.
If you’re a business owner or manager, you’re likely painfully aware of how time-consuming and expensive hiring the right employees can be. Between placing ads, proactively recruiting, and carefully vetting and interviewing hundreds of candidates, the total cost of hiring a single new employee can easily surpass $50,000.
With stakes this high, it goes without saying that companies need to do everything they can to ensure that their employees are happy – and effective – enough to stay put. But how can the average company create a set of business practices that prevents the kind of excessive turnover that can devastate a bottom line? It starts with a robust employee onboarding checklist.
According to a study by the Society for Human Resource Management (SHRM) Foundation, as many as 1 in 25 employees leave their jobs on account of problems stemming from poor employee onboarding. The SHRM research reveals the true cost of poor employee onboarding with a wide variety of statistics, most notably:
- 25% of American companies lose new employees within a year of their hiring, primarily due to poor employee onboarding.
- Up to 20% of turnover occurs within the first 45 days of employment.
- In the U.S. and U.K., the annual total costs associated with keeping unproductive employees who don’t understand their jobs amount to some $37 billion.
- The productivity lost from new hires adjusting to a company learning curve can amount to as much as 1% to 2.5% of the company’s total revenues.
- Fewer than 1 in 3 American executives are satisfied with their employee onboarding processes, and almost all of those who are dissatisfied admit that their poor employee onboarding reduces staff retention rates.
Qualitatively speaking, poor employee onboarding can result in the kind of bad outcomes that managers dread. On the one hand, a hire with the background, skill-set, and drive to become a bonafide company superstar might end up quickly leaving the company because she never gained a firm enough understanding of her role to deliver the results of which she was capable. On the other hand, if employee onboarding is too elongated, hands-off, or casual, managers risk being unable to identify a bad hire as early as desired simply because it takes months upon months for the new employee to get to a place where she is producing enough substantive work to be evaluated.In either scenario, you will be introducing unnecessary stress and uncertainty into your new hire’s adjustment period, which is never a good way to kick off a working relationship. What’s more, insufficient employee onboarding processes have been shown to lead to lower employee morale, lower employee engagement, lower confidence levels among employees, and a general lack of trust in the company and its leadership.
Good employee onboarding is critical for 3 major reasons:
- Employee onboarding is the most powerful, consistently repeatable way to make new hires feel welcomed, supported, comfortable, and prepared.
- Employee onboarding maximizes the potential that a new hire will make real contributions to the company, not only in the short-term but over the span of their tenure.
- Employees who genuinely believe they are contributing to the team tend to be satisfied with their position, meaning good employee onboarding increases employee retention and allows a company to focus its attention and resources on endeavors more productive than an unending hiring cycle.
Of course, essential as it may be, good employee onboarding requires a not unsubstantial investment of time and (human) resources. For many companies these initial outlays function as a decisive disincentive, which is why it is so important that you maintain realistic expectations when attempting to refine your employee onboarding onboarding checklist practices.
First and foremost, it should be understood that even a finely-tuned employee onboarding checklist is not a magic wand. There is simply no way to guarantee that a new employee will be functioning at full force on Day 1 or Week 1 or even Month 1. Indeed, allowing an employee onboarding process ample time to unfold is part and parcel of what makes “good” employee onboarding. That being said, it’s perfectly reasonable to wonder, “How much time is ‘ample time?’” As with most questions in the business world, the answer varies.
How Long Does Good Employee Onboarding Take?
Ultimately, you should expect three to six months on average to bring an employee fully up to speed, though hires with relevant experience at direct competitors using similar systems, policies, and procedures may take less time. Formal training will be much shorter, of course, but companies must accept that proper employee onboarding entails far more than just “showing someone the ropes.” Here are some expectations to keep in mind off the bat:
- The length of your employee onboarding process is determined in large part by your new hire’s existing competencies.
- Just about every employee shows up on Day 1 with a “proficiency gap,” that is, a gap between where their skills and knowledge are and where they need to be.
- As uncomfortable a truth as it may be, the average employee only operates with around 70% competence with respect to things like their company’s technical software and fine-grained policies.
- Nearly all employees learn the basics of their position – it’s hard to stay employed for long without doing so – and most will eventually progress to an intermediate level of expertise, but few end up surpassing a mid-level competence threshold.
...As such, it’s helpful to remember that employee onboarding need not turn new hires into experts overnight; it only needs to provide them with the fundamentals they need to succeed down the line.
A few options for condensing the timeline for your employee onboarding:
- The best way to streamline your onboarding and get your employees set up for success as quickly as possible is to establish organized and efficient procedures that can be replicated for each new hire. This is especially true when it comes to the HR side of the employee onboarding process. Nothing prevents hitting the ground running quite like spending your first day or two on the job filling out pages upon pages of forms unrelated to your actual work.
- Incorporate technology like authorized digital signatures and secure cloud-based data storage enable HR departments to execute their duties virtually. As a result, it’s no longer unusual for an employee to be totally squared away with HR prior to even setting foot in the office.
Even with a firm corporate commitment to this type of ongoing, comprehensive employee onboarding, figuring out how to go about acting on such a commitment can be quite overwhelming. Luckily, employee onboarding is at the heart of what we do at Continu, so we’ve gone ahead and assembled an outline of best practices for employee onboarding that we hope will take some of the anxiety out of what is clearly an absolutely essential business process.