How can onboarding software reduce cost & error?

Written by
Changeboard Team

05 Nov 2013

05 Nov 2013 • by Changeboard Team

Effective onboarding

Onboarding, induction, welcome scenarios – these are all words used to describe the strategic process by which we confirm an appointment decision and help new employees contribute to the profitability of a business as quickly as possible. Just as there are many words to describe onboarding, there are many ways to manage the process.

It is just as much your role to impress your new employees in their first few months as it is theirs to impress you. First impressions count: most new staff members who are unhappy in their position will decide to move on within six months, yet those who are satisfied by an effective onboarding process are likely to stay at least 18 to 20 months before reassessing their role.

Efficiency & metrics

Onboarding can also yield financial benefits and improve profitability. Companies who offer formal onboarding report a 60% year-on-year improvement in revenue per full-time employee, while onboarding management systems have been shown to save £500 per new employee.

Whether you use onboarding software or rely on a manual system, your basic plan should take into account the most common roadblocks. Are some individuals spending longer on the process than others? Which existing staff members lose the most time during onboarding, and can their load be shared? Don’t be afraid to ask your employees for feedback, as they are best placed to tell you what can be improved. Only once you have established a list of pressure points will you be in a position to take action.

For many, the most time-consuming element of onboarding is form completion. It is a task that can take hours or even days, with some individuals more heavily affected than others. HR teams losing valuable time to paperwork and administrative procedures like this often find onboarding software helps them overcome such obstacles.

A case in point is McLeod Health, an American healthcare organisation established in the early 1900s which averages nearly 1,000 appointments a year. When McLeod Health reviewed its onboarding process, it found that a new hire had to sign their name 33 times during their orientation day. In the resulting effort to streamline the process, the company implemented a web-based onboarding solution which made it possible to manage and track forms electronically. They subsequently reduced this number to zero. They also shortened orientation sessions by eliminating rudimentary information.

Heather Grier, director of talent management at McLeod Health, reported: “We have taken 60 minutes away from orientation and have therefore given the training team back 20% of that training time.”

Managing human error

Organisations that consistently bring new talent on board while simultaneously managing internal transfers are also at greater risk of human error when onboarding. It seems obvious, but you’d be surprised how often workers turn up to their new office only to find they aren’t expected, no one knows their name and no equipment has been set up in preparation. One high-profile organisation we came across exhibited an extraordinarily high turnover of 22% within the first three months. New staff would turn up and find they had no computer, no office and, sometimes, no desk. This is an extreme example of the importance of 'day one' readiness and illustrates the value of both first impressions and an effective well oiled process.

For smooth onboarding, existing staff should be well prepared for their new team-mate’s arrival. Again, software can help. A global engineering and consulting firm reviewed its induction method when it realised its high employee turnover was related to logistical breakdowns in the information and technology portions of the process.

Using onboarding software, the firm was able to allocate and track onboarding roles assigned to various staff members. It subsequently recorded a 70% reduction in administration and eliminated all process inconsistencies. It decreased the time new hires took to become fully productive by 40% and, most importantly, reduced the turnover of recent employees by more than 6.5%.

A business analyst and special projects manager for the company, commented on the benefits of onboarding software: “It fuses the human resources and business departments by creating clearer responsibility allocations and opening up communication lines to assure all new employees experience a seamless transition into our workforce.”

Reaping the financial benefits

Of course, onboarding doesn’t stop there. For example, staff require an introduction to company procedures and systems. The longer they take to settle into their role, the more they will cost their employer: an IDC report stated that new employees who don’t understand their role cost US and UK companies approximately $37 billion every year. Life events, such as maternity leave, transfers and offboarding also necessitate effective procedure and planning.

While some businesses can manage onboarding manually, our experience suggests that only the smallest and most static companies fail to reap benefits from automating through software – making it a resource most organisations can’t afford to be without.