‘Onboarding’ Improves Employee Retention

CU360
May 7, 2010 | COMMENTS

Organizations with a formal onboarding process saw a 60% greater annual improvement in revenue per full-time employee and a 63% greater annual improvement in customer satisfaction than those with an informal onboarding process, according to new research.

The ability of new employees to contribute quickly and be well-equipped to serve the needs of customers is critical to company growth, according to Onboarding: The First Line of Engagement, a report from research firm Aberdeen Group.

“Onboarding isn't just an HR exercise, it's a business imperative,” says Justin Bourke, Aberdeen research associate and co-author of the report.

One element in a successful onboarding process is a career development and planning program for new hires. Career planning—a key driver of employee engagement—empowers new employees to develop career goals and see their opportunities at the organization.

“A properly implemented career-development program gives the organization a leg up in retaining and engaging new hires over a longer period of time,” Adam Alexander, vice president of career development firm MasteryWorks, tells WorldatWork.org.

Younger workers frequently state the importance of work that meets their values, engages their sense of purpose, and contributes to their goal to being the best. With a better career fit, employees are more productive and willing to invest additional effort in their jobs.

When the economy begins to rebound and the job market improves, Aberdeen 's research speculates that engaged talent will be less likely to search for employment outside the organization because they see the fit and the opportunities at their present organization.

“Now's the time to listen to young talent and learn the value they can bring to your workforce,” says Alexander. Managers do this by understanding new employees' strong desire for autonomy, learning, and meaningful work.

Previous surveys from Aberdeen indicate:

• About 86% of respondents believe new hires make their decisions about whether or not to stay with the organization within the first six months on the job.
• Best-in-class organizations are 29% more likely than “laggards” to purposely socialize new employees into the firm's culture.
• The best organizations are 74% more likely than laggards to assign a mentor or a coach to new hires during the onboarding process.

This article was orginally published online by CU360, an online portal for benchmarking tools, market insights, industry data, and analytical information at cu360.cuna.org. Reprinted with permission.