It’s 8:28am when Michael arrives for his first day at work for Acme Enterprises. He walks up to the receptionist and says, “Hi, I’m Michael Berger, your new sales person.” Looking puzzled, the receptionist responds, “New sales person? I didn’t know we hired a new sales person.”  She calls the HR manager who informs her that Michael has been hired. 

The HR manager takes Michael to his desk.  Settling in, Michael opens the desk to find the previous employee’s leftover belongings… some business cards, a stale granola bar, folders with papers including the previous employee’s coffee-stained sales improvement plan. Michael can’t use the computer on his desk since he has no user name or password yet.  The phone has the name “Sam” on the screen.  He doesn’t have a Sales Manual, company phone directory or any of the tools he needs to start working.

As Michael looks around, employee after employee walks by, takes a quick glance and continues along.  No one steps into the office to meet and greet Michael.  But Michael hears whispers in the hallway. “Who is that guy in Sam’s office?”  Michael would love to get a cup of coffee, but he has no idea where to get it. He also needs to use the bathroom, but once again he has no idea where it is.  The rest of Michael’s first day continues much like this. As he drives home, his wife calls to ask how his first day went. Imagine what he will say.

There’s a common misconception that when a candidate accepts a company’s offer that he or she is fully committed. That’s not the case at all. Michael hopes he made the right decision, but he is keeping his options open. He may even continue looking for and considering other jobs even as he tries to settle into his new position. 

That may explain, in part, why the turnover rate for new hires is so high.  In Montana in 2008, for example, only about one quarter of new hires remained with the same employer a year later.  That was a 75% staff turnover rate, year over year.  To learn more about the problem, a Montana Unemployment Insurance Division survey found that that about 65% of newly hired Montana workers were still on the job after one quarter. The figure dropped to about 41% after two quarters and to 24% by the end of the fourth quarter.

This is a serious issue of concern for employers, who spend a lot of time and money hiring and training.  An employee, in terms of cost, costs a company more than just the salary which can be substantial all by itself. There is the added cost of recruiting and training.  Recruiting alone can be expensive when factoring in advertising, time cost of internal recruiting, time cost of reviewing resumes and performing other recruitment-related tasks, time cost of the person conducting the interviews, drugs screens, background checks, and pre-employment assessment tests, if any. Not every new hire may require the entire process, but even an $8/hour employee can end up costing a company around $3,500 in turnover costs, both direct and indirect. For a senior level manager, the cost is estimated to be about 10x that or $35,000.  Recruitment is just the first step in the process.  Once the person is in place, businesses need to provide adequate training so the new employee can do the work and start producing for the company. Training turns out to be one of the costliest investments a company can make.

Employee turnover is also bad for employees.  Churn keeps staff from gaining the skills to advance to better paying jobs, if they don’t stay put.  This is especially true in an economy with record unemployment rates.

To help minimize staff turnover, or churn, top organizations implement a selective hiring program coupled with a strong Onboarding Program. An Onboarding Program is a first-day (or sometimes First Week or First Month) plan designed to ensure a positive new hire experience, especially for salespeople… where churn is highest. That onboard experience can help establish the relationship foundation.

Indeed, studies have shown that without a proper Onboarding Program, the typical orientation drill for new employees leaves rookies feeling unsure, out of place and significantly more likely to start looking for another employer.  A study by the University of Toronto found that more structured Onboarding tactics made employees happier and more confident, and more likely to believe they fit both the job and organization. Those who went through a structured program were also significantly more likely to feel engaged and loyal to their employer than those that didn’t.  The take home message for managers under pressure to retain talent is that without a formal Onboarding program in place, there is less likely to be employee engagement.

Most organizations, however, think of the Onboarding process as primarily the imparting of information, which is necessary but not enough.  There also needs to be opportunities for employees to quickly develop a social network, establish where to get information and support, be assigned work that’s engaging enough to make them feel they are making a contribution and generate feedback that they are valued. 

Here are some best practices that are likely to help new employees engage with their organization:

Before first-day

• The boss or manager should make contact before the first day on the job.  Create a connection immediately.
• The human resources manager or supervisor should introduce the newcomer to other key members of the department and organization.
• The new employee’s desk should be cleaned and prepared for the new employee.
• The receptionist should be given the name of a new hire and told when will be that person’s first day so they can be greeted warmly by name.
• IT should set up the new hire’s user name, password and work station so that they can be up and running immediately at least with email.
• A box of business cards (or at least a stack of temporary business cards) should be ready for the new hire.  Place business cards in a gift package on the desk.
• If the new hire is getting a company cell phone, that phone should be on hand and operational on day one.
• If possible, the new hire should be assigned a mentor.

First day

• A wide range of topics should be covered in the orientation, including information about the company’s products or services, the company’s culture, logistics of the facility, and job-related tasks.
• The direct supervisor should check in and stay available to offer assistance / guidance.
• The organization should provide the training and materials needed to do the job as soon as the employee starts work.
• The manager and team who will be working with the new hire most should take the new hire to lunch.

First week

• Co-workers should make an effort to offer rookies help and assistance.
• The boss should clearly lay out measurable goals and expectations.
• Tasks assigned should be challenging from the start.
• The boss should provide ongoing feedback and co-workers should complement the newcomer on work well done.
• The newcomer should continue to receive information and training. Material already covered should be reviewed / reinforced while adding on additional information so as to avoid information overload.

First month

• Social events such as a barbecue or company party or sports event should be hosted periodically to encourage newcomers to get to know other employees on a more personal basis.
• A regular schedule of checkups should be done on how well the new hire is adjusting.
• The newcomer in turn should be asked to provide feedback about how helpful the orientation has been.

QUOTE OF THE WEEK

“A thousand words will not leave so deep an impression as one deed.” Henrik Ibsen

© 2011, Keren Peters-Atkinson. All rights reserved.