New Hire Orientation Blog
Onboarding Research Roundup #1: Improving New Hire Orientation and Training
The statistics related to new hire orientation and training are alarming. Many companies have no formal induction programs at all. Among those that do, most of the attempts don’t last long enough or are so ill-conceived that they do more harm than good. Onboarding has direct impacts on both the retention and productivity of new hires. And yet it seems much of corporate American simply isn’t getting the message. I present in this article an onboarding research roundup to show the extent to which this subject has been studied. I do this with the hopes that more companies will realize they should prioritize improving new hire orientation and training.
In the first two months of 2011, Aberdeen studied the onboarding practices of more than 280 companies, supplementing their survey with interviews of select respondents. They classified the quality of onboarding programs into three categories: 1) Best-in-Class, 2) Average and 3) Laggards. By doing this, they could then compare onboarding impacts by the quality of the programs, and thereby pinpoint suggestion for improving new hire orientation and training. Here’s a summary of what they found:
- Among best-in-class companies, 96% of first-year employees were retained, as opposed to only 18% in laggard companies.
- Best-in-class companies saw 82% of new hires meet their first performance milestone on-time, whereas this figure was only 3% at laggard companies.
- Hiring manager satisfaction among best-in-class companies improved 18% year-over-year, while at laggard companies their satisfaction actually decreased by 1%.
The Aberdeen Group has produced some of the most-cited research statistics around onboarding, and much of it still gets cited today even though some of it is years old. Then again, it doesn’t seem like much has changed, though, which is why it’s still relevant today. Highlights in this article include the following:
- Only 32% of companies have formalized onboarding programs.
- Among companies with formal programs, 54% see greater new hire productivity.
- Also among companies with formal programs, 50% experience better new hire retention.
- Companies with onboarding programs lasting less than a month are 9% less likely to retain first-year employees than companies with longer programs.
- Only 37% of companies have onboarding programs lasting longer than a month.
- 15 % of companies only allot a single day or less for onboarding.
- Among companies with formal onboarding, 29% have programs lasting 1-3 months.
- Companies that start onboarding early (pre-boarding) retain 81% of first-year hires.
Highlights of this study related to improving new hire orientation and training include the following:
- 51% of companies said their new-hire attrition is most likely to happen during the first six months.
- Most companies still treat onboarding like a static process that’s about document management, benefit enrollment, orientation, etc. as opposed to a strategic process focused on continuous learning, feedback and performance achievements.
- Companies with mature onboarding programs are way more likely to see increases in key performance indicators (KPIs), including engagement and retention.
- Companies that use a dedicated onboarding technology are 60% more likely to experience an increase in new hire engagement.
Several professors from higher education contributed to this article focused on the role managers and supervisors should play when improving new hire orientation and training. Here are their findings from several different studies:
- One study examined 409 college graduates throughout their first two years in the workforce. The degree of support they received from their supervisor played a big part in all kinds of things, including role clarity, job satisfaction, and even their salary over time.
- Another study found that they key to new hires adjusting well to their position had a lot to do with the level of support received (or not) from their supervisor.
- Many managers seem to take cues from the new hires. If the new hire is proactive in their own onboarding, such as seeking information and making connections, their managers were more likely to step up and help make it happen. But they should be providing that support regardless of whether the new hire is giving those signals or not.
Kronos and the Human Capital Institute joined forces to gather responses from HR leaders at more than 350 companies across a wide range of sizes and industries. Key findings included the following:
- 76% of HR leaders say onboarding is underutilized at their companies.
- 57% blame lack of bandwidth among managers for not doing better onboarding.
- 60% say onboarding should include workplace culture, but only 30% of onboarding is devoted to it.
- 24% of companies have no “trans-boarding” programs for employees making a transition from one position to another.
- Too many companies think of onboarding as the paperwork and not about long-term success. This is why most onboarding programs cover company policies/rules, a company overview, resource orientation (workstation and technologies), and building tours. Much less common are what’s really needed: peer mentoring, assessment of future training needs, access to self-paced training resources, and meetings with key stakeholders.
- 37% of companies have onboarding programs lasting less than a week.
- 24% have programs lasting a month.
- Only 10% have programs that last a full year.
- 55% of companies say they don’t measure the effectiveness of their onboarding.
- 39% of HR leaders say they lack the right resources and technology to do better onboarding.
BambooHR is a software-as-a-service (SaaS) vendor that tracks all kinds of information about onboarding programs. Here are some of the impacts they found from better onboarding:
- Employees who say their onboarding experience was great were 18 times more likely to feel highly committed to their companies.
- 91% of employees who had effective onboarding felt strongly connected at work, as opposed to only 29% who experienced ineffective onboarding.
- 89% of employees who experienced good onboarding felt well-integrated into company culture, as opposed to 59% of those who had ineffective onboarding.
- 49% of employees who had effective onboarding reported making contributions to their team within a week, as opposed to only 35% of those who had ineffective onboarding.
- Employees who experienced effective onboarding were 31 times more likely to report high job satisfaction.
- Employees who had good onboarding were 48 times more likely to report feeling highly supported by their company.
Gallup’s State of the American Workplacelooks at many different aspects of the workplace, but one key finding related to onboarding from surveying more than 195,600 workers is that only 12% of employees strongly agreed that their company does a great job with new employee onboarding.
Digitate conducted a survey of more than 1,500 corporate professionals across such industries as financial services, professional services, IT, and manufacturing. Key highlights include the following:
- New hires who experience poor onboarding twice as likely to look for a new employment opportunity in the near future.
- After a negative onboarding experience, one in five new hires are unlikely to recommend the employer to friends or family.
- 59% say that onboarding would benefit from greater automation.
- 50% say the IT part of onboarding is too slow in resolving issues.
- 40% say that HR is too slow in answering questions new hires may have.
Three professors from three different institutions of higher education (London Business School, Harvard Business School, and the University of North Carolina Chapel Hill) published their research findings in a 2013 issue of the MIT Sloan Management Review. The conducted an in-depth study and experiment of onboarding practices at Wipro BPO, a business process outsourcing company providing telephone and chat support for global customers. They took 605 incoming employees and divided them among three different first-day experiences. Group 1 had an experience centered on individual identity (each individual’s strengths and unique perspectives they could bring to the company), Group 2 focused on organizational identity (where the emphasis was placed on the company’s norms and values of which they could be proud), and Group 3 went through the company’s traditional onboarding (focused on describing the job requirements). Key findings included the following:
- Group 1 hires were 32% less likely to quit within the first six months than Group 3 hires, and 21% less likely to quit than Group 2 hires.
- Customer evaluations of service received from Group 1 hires were significantly more positive than Group 3 hires
- Group 1 hires showed higher work engagement, higher job satisfaction, and high performance, both in terms of quantity (more data entered) and quality (fewer errors).
I’ll conclude with this quote from SHRM (Society for Human Resource Management):
“Onboarding new hires at an organization should be a strategic process and last at least one year to ensure high retention”
This article covered key highlights from all the most recent research about improving new hire orientation and training. Stay tuned for future research roundups as new studies become available.