Process & Workflow

What is Employee Onboarding and Why is it Important?

Dec 21, 2021
Post Masthead

Many companies today vastly underestimate the importance of properly onboarding employees. Statistics show that 22% of companies don’t have any formal onboarding program in place; only 49% of companies have a somewhat successful onboarding process.

An unsuccessful onboarding program can cause employees to feel stressed out and disconnected from the rest of their team, and can also result in mismanaged expectations. These issues can drastically reduce productivity and morale. Furthermore, companies without employee onboarding programs end up spending a lot more due to higher employee turnover rates.

In this article, we will look at what employee boarding is and why your company can’t afford to be without one.

What is Employee Onboarding?

Employee onboarding, also known as organizational socialization, is the process of integrating new employees into a new company or organization. Onboarding helps the employee to get up to speed on their roles, how the company works, and the culture. There are plenty of activities that go into the onboarding process; from extending a job offer to team training exercises.

Onboarding vs. Orientation

It is important to know the difference between orientation and onboarding. Both of these terms are often used interchangeably, even though they differ.

An orientation is often a one-time event, which typically lasts several hours to several work days. The onboarding process often begins with an orientation.

Onboarding is the process of getting an employee set up in his or her role within the company, which includes everything from completing payroll to benefits paperwork, to systems access, to attending training. An orientation typically kicks off the employee onboarding process.

The onboarding process benefits everyone in the company, from new hires, old employees, and company leaders. If you want to maximize the effectiveness of your employee onboarding process, it is best to begin before the employee’s start date. This will allow new hires to become acquainted with your company before they begin their new role.

What Are Onboarding Activities?

Although onboarding activities can differ from company to company, here are some examples of typical onboarding activities:

  • Job offers
  • New hire paperwork
  • Payroll setup
  • Job training
  • Systems access
  • Policy training
  • Company culture training
  • Employee handbook training
  • Benefits education
  • Benefits paperwork
  • Team introduction
  • Executive introduction
  • Facility tours

Why is Employee Onboarding Important?

From your employee’s first day on the job, you want to provide a great experience. To achieve this, an effective onboarding process is crucial. The employees are the heart of any business. You will want to retain your staff and maintain their morale by keeping them happy. High morale will result in higher productivity and therefore, higher success for the business. A successful onboarding program will help new hires feel like they are valuable assets and members of the team.

Research from reputable organizations such as the Society for Human Resources Management (SHRM) has shown that employee turnover during the first 18 months has reached as high as 50%. Organizations have realized that they need to put more effort into communicating and showing employee value.

The Benefits of Employee Onboarding

Here are the top benefits of a thorough and effective employee onboarding process:

1. Employee onboarding allows new hires to become productive as quickly as possible.

A thorough and well-thought-out onboarding process can significantly boost a new hire’s productivity. When implemented properly, employee onboarding can provide a 54% increase in productivity. A people-first culture will lead to a happier staff who understands their role in the business.

The overall length of the onboarding process will depend on your business’ operations. In fact, the most effective onboarding processes can last from 6 months to over a year.

Without an onboarding process, new hires can take up to 8 to 12 months to reach their peak productivity levels. This can result in the company losing 1% to 2.5% of its total revenue.

2. Employee onboarding helps new hires adjust to their new roles and their unique place in the company.

If you’re hired for a job and you don’t fully understand what you need to do and what’s expected of you, how are you supposed to perform well in your role? Employee onboarding takes care of this problem.

The onboarding process brings the job description into real life by showing and explaining what’s expected of new hires.

By the time the onboarding process ends, new hires should know how their role fits in the team and the company as a whole, and how their role is aligned with the company’s overall mission and values. When employees feel valued and like an important asset to the business, this motivates them to do their best work.

3. Employee onboarding reduces new employee stress and anxiety.

Being a new employee can be a very stressful experience, we’ve all been there. As employers, you can reduce the stress and anxiety new hires experience by providing them with all the information they need to be successful in their roles.

A solid onboarding process will result in overall less anxiety. It also helps new employees get acclimated with the team, cross-functional departments, and leaders,  which results in more effective communication. Onboarding facilitates relationship building, which is a huge part of a happy working life.

4. Employee onboarding reduces employee turnover.

If one of your organizational goals is to reduce employee turnover rates, then the first step is to develop or revisit your employee onboarding process. Studies suggest that replacing an employee can cost six to nine months’ worth of salary on average. Statistics also show that employees don’t hang around long if they aren’t happy in their work lives. According to the Bureau of Labor Statistics, people often have worked 12 jobs between the ages of 18 to 50 years old.

This shows how companies need to put more effort towards improving employee engagement, and employee onboarding is a great start. Onboarding enables the new hire to see how you communicate with employees, set expectations and clear goals, nurture cultural integration, and foster professional and social networking. Overall, it’s important for new members to feel welcomed, mentored, and heard.

Streamline Your Employee Onboarding Process

Maintaining morale and happiness amongst your staff is crucial. Employees are one of the most important assets to any company. Set up your team for success with a thorough onboarding process.

By maximizing tools like Rindle, you can not only document but track and even automate a number of steps in your employee onboarding process. This is an organized, effective, and efficient way to ensure that each new team member has the best experience with your company.