Do you remember the last time you joined a new job? What was your experience like on the first day? Were you handed a stack of papers to sign, left to figure things out on your own, or thrown into a meeting where you had no idea what was going on? Or, on the flip side, did the company provide a structured onboarding program – a clear roadmap, well-thought-out training modules, an onboarding buddy or mentor, and time to ease into your new role?
If it was the latter, chances are you felt confident, supported, and ready to contribute much sooner. If it was the former, however, you probably spent weeks – or even months – trying to find your footing. This difference in experience highlights why effective onboarding is not just a “nice-to-have” but a critical business investment.
Hiring a new employee is an investment, but without a structured onboarding program, that investment often doesn’t pay off as intended. Many companies spend a fortune on recruitment, but upon hiring someone, they assume that a quick introduction to their team and a stack of company policies are sufficient for the new hire’s onboarding. However, the absence of a well-thought-out onboarding program can lead to lost time, increased costs, delayed productivity, and high turnovers – factors that can directly impact a business’s bottom line.
In this blog, we’ll explore why an effective onboarding program is critical for small and medium-sized businesses (SMBs), what it should include, the consequences of neglecting onboarding, and the tangible benefits of getting it right. We’ll also provide actionable steps to help you create a successful onboarding program for your new hires.
What is an Onboarding Program?
An onboarding program is a structured process that helps new employees integrate into your company, understand their roles, and quickly become productive team members. It’s not just about signing papers or getting a laptop—it’s about equipping new hires with the tools, knowledge, and support they need to succeed.
What does an Onboarding Program Include?
A comprehensive onboarding program typically includes:
1. Logistical Setup:
This is the part that ensures new hires have everything they need, such as:
- Company equipment (e.g., laptops, phones).
- Access to tools, software, and systems.
- Payroll, benefits, and administrative setup.
2. Training:
This includes training the new hires on the company’s culture, vision and mission, their products and/or services, etc., as well as providing role-specific training. This includes:
- Company-wide Onboarding: This training helps employees understand the company’s mission, values, and culture, and introduces them to colleagues.
- Role-Specific Training: This is training tailored to the employee’s role at the company, to ensure they understand their responsibilities and the tools they’ll use daily.
- Compliance Training: This training covers mandatory topics such as workplace safety, harassment prevention, and industry regulations.
3. Ongoing Support:
This includes activities such as providing mentorship, regular check-ins, and feedback to the new hires throughout the onboarding period.
How Long Should Onboarding Last?
While some onboarding tasks can be completed in the first week, effective onboarding is not a one-day or one-week event. Research suggests that onboarding programs should last at least 60-90 days to ensure employees feel supported and confident in their roles. For more complex roles, onboarding might even extend to 6-12 months.
Comparing a Poor (or worse, Non-existent) vs. Structured Onboarding Program
Many companies underestimate the impact of onboarding on their business. They assume that a few HR presentations and self-directed training are sufficient. However, poor onboarding – or worse, no onboarding at all – can lead to significant challenges, including high turnover, delayed productivity, and disengaged employees. On the other hand, an effective onboarding program can significantly improve employee retention, engagement, and performance.
Let’s examine four key areas where a structured Onboarding Program makes a difference:
1. Employee Retention:
Without a structured onboarding program, new hires often feel unsupported, disconnected, and unprepared. According to studies, up to 20% of employee turnover occurs within the first 45 days of employment (Source). This indicates that the initial phase is critical for employee retention.
On the flip side, implementing a robust onboarding program can significantly enhance retention. Research indicates that organizations with a strong onboarding process improve new hire retention by 82% (Source). This improvement not only reduces the costs associated with hiring and training new employees but also fosters a more experienced and cohesive workforce.
2. Employee Time-to-Productivity:
Without a structured onboarding program, new hires may take longer to reach full productivity, leading to inefficiencies and increased costs. The absence of clear guidance and resources can leave employees feeling unprepared, delaying their ability to contribute effectively to the organization.
Companies with specialized onboarding programs, however, see better time-to-productivity ratios, with 64% achieving better outcomes compared to those without structured processes (Source). By providing clear expectations, training, and resources, new employees can integrate more quickly and start contributing to organizational goals sooner.
3. Employee Engagement:
Employees who feel unsupported or disconnected during onboarding are less likely to engage with their work. According to a study, only 12% of employees strongly agree that their company does a great job onboarding (Source). Disengaged employees are more likely to leave, and those who stay tend to perform at lower levels.
Effective onboarding experiences, on the other hand, make employees 30 times more likely to feel satisfied with their jobs (Source). Engaged employees are more productive, provide better customer service, and contribute positively to the workplace culture, driving overall organizational success.
4. Employee Performance:
Inadequate onboarding often results in confusion and mistakes. Employees may struggle to learn on their own, leading to errors, inefficiencies, and wasted time. This not only affects individual performance but can also disrupt team dynamics and project timelines.
Organizations with structured onboarding processes, on the other hand, see 62% of new hires meet their first performance milestone (Source). By equipping employees with the necessary knowledge and skills from the outset, they are more likely to perform well, meet targets, and contribute to the organization’s success.
These statistics show that investing in a comprehensive onboarding program is not just beneficial but essential. It leads to higher employee retention, faster time-to-productivity, increased engagement, and improved performance – factors that collectively contribute to a more robust and successful organization.
How to Set Up an Effective Onboarding Program
So, you are prepared to work towards setting up a good Onboarding Program for your company. But where to start? Well, creating an effective onboarding program doesn’t have to be overwhelming. Here are a few key steps to get started:
1. Define Your Objectives:
Determine the specific goals of your onboarding program, such as reducing turnover, shortening time-to-productivity, or improving employee satisfaction.
2. Plan the Onboarding Journey:
Develop a timeline that outlines key activities and milestones for the first week, first month, and first 90 days.
3. Prepare in Advance:
Ensure all logistical arrangements – such as equipment, system access, and training materials—are ready before the new hire’s first day.
4. Customize Training:
Design company-wide, role-specific, and compliance training modules that address the unique needs of each employee’s position.
5. Incorporate Mentorship:
Assign onboarding buddies or mentors to guide new hires, answer questions, and help them integrate into the company culture.
6. Solicit Feedback:
Regularly gather feedback from new hires about their onboarding experience and make improvements based on their input.
Conclusion
Investing in a comprehensive onboarding program is not merely a procedural formality but a strategic imperative for companies of all sizes, but even more so for small and medium-sized businesses. Effective onboarding accelerates new hires’ integration, enhances engagement, and boosts overall performance. By prioritizing structured onboarding, your organization lays a solid foundation for sustained growth and success.
Start today, by taking small steps towards structuring your company’s onboarding!
