Why Onboarding?

Created: January 5, 2021

I am probably in so much trouble for not "starting with Why" in this Onboarding series, but let's agree that it's better late than never and talk about why a solid Onboarding program is so important to a sustainable software practice.

There is a mountain of research on the state and the impact of employee retention and engagement because either one or both of these being low within an organization is a very expensive and stressful problem. While I would love to have numbers that are more specific to the NetSuite development space, I couldn't find any in my research. You can help define them by completing this short survey. I've aggregated a few findings from various studies, surveys, and other sources:

The Costs of Turnover

• Around 25% of all new hires turnover in a single year. (source 1, source 2)
• It costs 50 - 150% of an employee's salary to replace them. (source 1, source 2)
• Absent any Onboarding program, it takes new hires 8 - 12 months to gain job proficiency comparable to their tenured co-workers. (source)

The Benefits of Onboarding

• Standardized Onboarding processes can provide a 50 - 60% productivity boost (source 1, source 2)
• Companies with standard Onboarding procedures report 50% higher retention rates (source 1, source 2)
• Of new hires who hit their first performance milestone, 77% had formal Onboarding training (source)

The Implications of These Numbers

When I step back to look at all of these numbers and reflect on my own experiences as a software manager, I see just how critical employee retention is. Turnover is incredibly costly in terms of not only cash but also time, individual stress, organizational knowledge, and reputation. Even without all of these numbers, if employees are consistently leaving your team quickly, then you don't have a good, healthy place to work, and if you can't offer your employees that simple thing, what exactly are you doing running a team?

Onboarding programs have consistently been shown to improve employee retention, performance, and engagement - which is a fancy way of saying Onboarding helps employees enjoy working for you more, so they stick around longer and do a better job. An Onboarding program gives you - the leader of a team - an opportunity to step up and showcase that leadership. It also helps you and your company stand out in a crowd where Onboarding is lacking. At the time of this writing, 75% of respondents to my aforementioned survey have no consistent Onboarding program for their developers.

The worst and best news in all of this is: Onboarding programs are not complicated to set up. By creating a few documents outlining your team's processes, planning a simple series of check-in conversations you have with every new employee, and genuinely caring about the people you hire, you have the beginnings of a framework for building a consistent, effective team of rockstars who enjoy working with each other and with you.

HTH

-EG