In today’s dynamic and constantly evolving organisational context, having proper onboarding procedures in place is crucial. This concept refers to the steps an organisation takes in the provision of acclimatising new employees to their organisational environment and tasks. Unfortunatley, this phase often goes ignored by the companies and this results in great consequences for the company’s financial and cultural status. Organisation failure of onboarding can lead to disengaged employees, high turnover rates, and a negative organisational culture. To prevent such shortcomings, organisations require knowledge of the hidden costs of ineffective onboarding and the advantages of developing proper onboarding strategies.
Financial implications of poor onboarding
Poor onboarding has several huge impacts, and unfortunately, the organisation suffers most from it, one of which is the financial cost. When the new employees are not developed or trained properly, they are likely to quit the organisation within the first few months. This high turnover propensity poses a big threat due to the fact that the firm will spend so much time and resources on the recruitment and training of new employees. The survey conducted on the Society for Human Resource Management (SHRM) indicates that the price of turnover is between 6 to 9 months salary of the turnover employee. Hence, for a mid-level manager who earns $60,000 per annum, this might mean a replacement cost of $30,000 -$45,000.
Apart from the direct costs of employee replacement, poor training affects organisational productivity, incurring more costs. Employees who were hired and not well trained may lack direction in their tasks, causing several delays and mistakes. This may lead to late submission of projects, poor quality of the finished work and loss of revenue. Furthermore, the problem of poor onboarding impacts the morale and productivity of other employees who might end up holding several positions within the company while waiting for new employees to get ready for the job.
Cultural costs and employee engagement
The cultural impacts of poor onboarding are as serious as the monetary ones, not to mention the lost organisational productivity. If the onboarding process is negative, disengagement is usually the result, which goes viral in the organisation. Disengaged employees are less likely to work hard, develop new ideas, or stand for the organisational objectives. They can also be more inclined to spread negative employee feedbacks to internal or external employers, jeopardising the company’s reputation and making it harder to attract talent.
Whereas in the workplace, proper onboarding will make the new worker feel wanted, appreciated and a member of the company team without compromising the corporate culture. This can result in increased levels of engagement of the employees, and this has been attributed to higher productivity, creativity and reduced turnover. The organisations that invest in onboarding are investing in the success of new employees as well as organisational health and culture.
The role of technology in onboarding
With the current advancement in technology, technology also significantly impacts onboarding. Modern platforms such as KlaraHR have quickly transformed the onboarding process, making companies extend similar experiences to new employees. With KlaraHR, companies can offload all the paperwork and IT account creation during onboarding, thus enabling the HR team to focus on core business activities.
Moreover, technology can enforce timely and customised onboarding to meet the needs of each employee. For instance, onboarding programs can offer self-paced webinars, video tutorials, office and department overviews, and self-assessment surveys, thus allowing new workers to become productive and acclimatise to the organisation much faster. Through technology, organisations can guarantee that the onboarding process is compelling and exciting.
Long-term benefits of investing in onboarding
The benefits of getting involved in a more detailed onboarding process are numerous and consist of short-term and long-term advantages for companies and their employees. First of all, good onboarding can help increase the retention rates of the employees in the company. If the new employees are assured of support and know they are fully equipped, they will most likely remain loyal to the firm. This lowers costs associated with high turnover rates and assists in forming a steady, talented staff.
Furthermore, effective onboarding implementation could increase employee satisfaction and commitment levels. Engaging in onboarding often helps the employees feel anchored in the firm’s goals and objectives, making them work harder and with more commitment. This, in turn, can translate to increased production, creativity, and customer satisfaction, boosting the company’s revenues.
Lastly, investing in onboarding helps establish a powerful employer brand. Given the current state of affairs in the job market, prospective employees seek organisations to support their growth and provide for their needs. That is why proper onboarding can act as leverage to stand against competitors and attract candidates who value employee well-being.
Final thoughts
The impact of poor onboarding is vast as it concerns monetary losses, corporate culture, and reputation. To remedy the situation, a company has to engage in a proper onboarding program to reduce high turnover rates, low productivity, and demotivated workers. They can, however, cultivate an atmosphere that can bring about work engagement and satisfaction, hence long-term productivity. With current and future changes in the business environment, companies that invest in onboarding will gain a competitive advantage from talent acquisition and employee engagement to innovation and growth.
