Onboarding Metrics: Measuring New Hire Orientation and Training

There are many different things businesses do to keep their bottom line heading in the right direction. From a big-picture point of view, these activities typically involve increasing productivity while at the same time keeping costs under control. But it’s also common for companies to pay more attention to some areas than others. For manufacturers, there will be close scrutiny of their product output, the efficiency of the manufacturing process, costs of raw materials, sales, and so on. Service providers will obviously focus on account management and customer satisfaction. There’s one thing, however, that rarely gets put under the microscope: onboarding. This article will cover the why and how of onboarding metrics for measuring new hire orientation and training.

Why Measure Onboarding Metrics?

Doing right by your company’s new hire orientation and training program, otherwise known as onboarding, is a critical component of business success. I’ve presented the findings of recent research to show onboarding’s importance and impact, and I’ve also written articles showing the specific impacts of better onboarding on both retention and time-to-productivity. Given the importance of onboarding to the company’s bottom line, it makes sense to take a closer look at what can be revealed by measuring it. After all, as a variation on a well-worn saying goes, you can’t manage what you don’t measure.

Of course, measuring and tracking onboarding metrics presupposes your company has formal programs for new hire orientation and training. Research has revealed this only true for 32% of companies, which is an alarmingly low figure. For those companies, the pages and articles on this site give guidance on all the various pieces that go into great onboarding. And this article will serve as a starting point any company can use for beginning the development and tracking of the onboarding metrics you need to evaluate and improve your new hire orientation and training.

Starting to measure key metrics as soon as possible is important in order to establish benchmarks and see changes over time. And make no mistake, things do change over time, and often over a surprisingly short amount of time. If you notice turnover is up (or retention is down) among a particular group of employees within their first two years, you would definitely want to closely examine all kinds of data points from your onboarding program. Noticing a decrease in productivity among a group of employees would also warrant drilling down further into onboard metrics. But you’ve got to measure all of this on a regular basis and analyze the data in order to reveal actionable insights.

Choosing What to Measure

In a previous article, I explained how companies shouldn’t feel like they have to create a full-blown formal onboarding program all at once. For many companies, the mere thought of trying to do so is overwhelming enough to prevent them from ever doing it. I laid out a plan for developing a robust new hire orientation and training program over the course of seven months. It’s okay to start out with baby steps to develop your onboarding program, and it’s okay to start out small with measuring your programs as well. Choose a few key metrics you think will give you highly useful data to inform business decision-making. You can then build out additional evaluation measure from there over time as your company sees how valuable it is.

Your metrics might be mostly quantitative, mostly qualitative, or a mix of both depending on what makes the most sense for your unique company context and culture. You might also find that the quantitative metrics are useful for identifying areas where you need to drill down into employee experiences in a more qualitative way to find out what’s going on, such as interviews and focus groups.

Most companies want to pay attention to the well-documented relationship between onboarding and two key indicators: new employee retention/turnover and new employee productivity. Your main retention metric can be as simple as the percentage of new hires who remain employed at your company after two months, six months, and then the one-year mark. This synchs up well with my recommendation for a year-long approach to new hire orientation and training. On the productivity side, a good place to start is the percentage of new employees who meet their first performance goal, and then the percentage of newbies who meet their remaining performance goals throughout the rest of their first year. The initial performance goal metric shows how well you’re doing with initial training of employees while the other first-year performance goals reveals how well you’re doing with ongoing training and support in the first year. The first time you see these numbers, they will raise more questions than they answer, but that’s part of the point. It will immediately lead you deeper into investigating what’s going on and why.

For example, if your turnover rates are high (or retention is low), you’ll want to know how much of turnover is due to workers quitting versus workers being terminated. And then you’ll want to drill down further into each group to figure out what happened. This will naturally lead you to develop other measurements, such as new hire satisfaction with each component of your onboarding program, exit interviews with employees who quit, reasons for termination, and so on.

If you notice a higher-than-desired percentage of new hires who fail to meet their first performance goal, you’ll want to drill down into whether or not their initial training was adequate, if there was possibly a too-much-too-fast experience, if there are skill gaps that need to be addressed differently, and so on.

To re-cap, here are three simple onboarding metrics any company can start benchmarking and tracking now:

• Retention: Percentage of new employees who are still with company at several key intervals such as at the end of the two-month, six-month and one-year marks.
• Initial Productivity: Percentage of new employees who meet their first performance goal.
• Ongoing Productivity: Percentage of new employees who meet each performance goal throughout their first year.

Getting started now with measuring new hire orientation and training with a few key onboarding metrics will serve as a launching pad for further developing a robust measurement and evaluation plan to improve your onboarding programs over time. Good luck!