At its best, onboarding gives a lot of important information about the values and culture of a company that someone has just joined. Everything from benefits to the organization’s financial status and future prospects can be a part of the onboarding process. A well thought out onboarding program can go further, and teach new hires about the department they’ve joined, and their role within it. When done right, the onboarding process helps new employees quickly figure out how they fit into their new company’s big picture.


It makes sense. But does your organization actually need to invest its time and money to develop a comprehensive onboarding process? Is there a downside to just offering your new people an average orientation?


Below, are some very real consequences of not developing and implementing a strong onboarding process.


  • Honeymoon’s over, now what? The first year at a new job tends to be the happiest for many people. But once a person starts to understand the internal culture better, what may have looked like a company’s innovative approach can start to feel imitative, even uninspired. Before long, disappointed staffers may log back onto LinkedIn to scope out new opportunities. But new hires who have a great onboarding process are 69% more likely to stay for three years. Onboarding programs are important because they give individuals the support and guidance they need to successfully assimilate into a new workplace culture.


  • Hire, replace, repeat: Frequent turnover forces organizations to spend time and money on recruiting and training new employees. A study by the Society for Human Resource Management found that the average cost-per-hire is $4,129, while the average time it takes to fill a given position is 42 days. And a Center for American Progress report revealed that the average cost to replace someone in an executive position can be up to 213% of that person’s annual salary.


  • Demotivated: Besides the financial cost, companies that can’t hold on to their new hires also have to cope with their people’s declining morale. It becomes more and more difficult for people to feel engaged, and perform at high levels, when colleagues they’ve just met continue to vanish. There’s a strong connection between workplace relationships and job satisfaction. When employees must repeatedly get to know new employees, a sense of common cause becomes harder to sustain.


  • Boosting performance: Organizations that use an onboarding process experience up to 54% greater new hire productivity. Mark Stein and Lilleth Christiansen, authors of Successful Onboarding, note that beyond the challenges of recruitment and retention, productivity is perhaps the most important reason onboarding has taken on such immense strategic relevance for progressive firms.” For Millennials who are new to the workforce, and not sure about what to expect, onboarding is even more important for setting new hires on a path to success.


  • Spotting trends: One study found that 30% of companies that frequently update their onboarding programs are more likely to respond effectively to employee trends. A company that treats onboarding as an ongoing process, where employees give their feedback on the support and training they’re getting, can find out what their employees need to thrive. And spotting the different needs of different people will help your organization change up its onboarding process accordingly.


First impressions last a lifetime: For today’s HR professionals, an effective onboarding solution is critical to making a new team member’s first months a success. With about one-third of new hires quitting their jobs after six months, companies need to do more than email their new people some forms to fill out. The best onboarding processes are those that use the occasion of someone new joining the company as a team-building opportunity. From bringing colleagues together to meeting a company’s key people, onboarding done right treats new employees as valued individuals from day one.This approach increases the likelihood that they will instantly connect with their new co-workers and company. And a more engaged employee is more likely to stick around for awhile.

from Danielle Mizrachi

Danielle is a Marketing Manager at Hibob. She studied Business and Psychology and believes in the power of utilising behavioral insights to form great companies. She enjoys discovering what the future of work might look like, listening to podcasts, traveling, and hiking.