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Published May 2008

On-Boarding Leads to Better Retention

  

  Lindsay Edmonds Wickman

Because of the looming talent shortage, retention is more important now than ever, so many organizations are pushing on-boarding as a strategy for retaining new hires, according to a recent study from Aberdeen Group.

Of the nearly 800 human resources and line-of-business managers surveyed, 70 percent listed “new-employee retention” as the top reason for pursuing on-boarding. In the 2006 study, organizations cited “new-hire productivity.” Additionally, 62 percent of those polled have a formal on-boarding strategy, and that number is expected to grow to 77 percent in the next 12 months.

“Now with the changes in the labor market, it’s all about retention,” said Julie Ogilvie, vice president of corporate marketing at SkillSoft, a SaaS provider of on-demand e-learning and performance support solutions and sponsor of the Aberdeen Group report. “It’s about bringing that highly skilled recruit on board, introducing them to the culture and then trying to keep them happy so they will stay.”

The organizations that achieved Aberdeen’s best-in-class status experienced, on average, a 100 percent improvement in the retention of new hires, a 60 percent reduction in time-to-productivity for new hires and a 57 percent increase in completion rates for on-boarding tasks, according to the report.

Those in the best-in-class category have moved away from the simple, bare-bones on-boarding of the past to a more sophisticated process.

“Before I read this report, I was guilty of thinking of on-boarding in a very simplistic way, probably the way a lot of people do,” Ogilvie said. “I thought of it as the new-hire training that all of us have gone through at one point in our lives, where we’re herded into a conference room and we fill out our benefits forms, listen to a lecture on what the HR policy is and then go on our merry way. But what you see in this report is that on-boarding starts even before the person comes to work on their first day.”

On-boarding is a critical component of retention if it educates new recruits about the entirety of an organization from policies and procedures to culture and values.

“It’s a whole set of activities that goes way beyond just simple training or filling out a few forms,” Ogilvie said. “[It] is actually the introduction into the whole performance management and talent management cycle. [Organizations are] making more of a push to smooth that entryway into the workforce.”

Training and on-boarding go hand-in-hand, but it has to be more than just the run-of-the-mill lecture about company policies. In introducing new employees to an organization, companies are using a variety of mechanisms, from Web 2.0 solutions to simulations.

“It’s more than just communicating specific knowledge or information; it’s about communicating company values and culture and then making people feel comfortable [in] this new environment so that they [are] retained,” Ogilvie said. “Training is a central part to making people satisfied initially and then keeping them satisfied in the long run.”

For on-boarding to be successful, organizations must develop a strategy and align that strategy with the overall company goals.

“It’s important to [understand] what the key success factors are in your company and then [make] those the hallmark of your on-boarding,” Ogilvie said. “The other part is making the employee feel comfortable with the culture they’re becoming a part of.”

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