Introduction: On-boarding for organisational growth

Transcription

1 On-boarding for organisational growth

2 Introduction: On-boarding for organisational growth As we shuffle forward into a phase of moderate economic growth, we are seeing signs of recovery in the job market along with changing business and consumer expectations. This has brought about the realisation that organisations need to ensure: They bring the right people on board That these people are ready to engage with the organisation s way of working And that they are made feel part of the business and are here to stay The expectation is that by attending to these aspects of selection and on-boarding, organisations will be better placed to deliver excellent customer service and to retain their staff as economic growth takes a firmer foothold. In this paper we will explore some of the drivers of the current focus on on-boarding, walk through some of the financial implications of improving the onboarding process and outline a model of on-boarding that spans the employee lifecycle. We finish by providing practical advice on how to best execute an on-boarding strategy to create an engaged and productive workforce. On-boarding for organisational growth 2

3 Job growth There is a palpable growth in business optimism which is leading to more job vacancies and therefore more new recruits. In a recent global Aberdeen survey 48% of employers reported an expectation to increase headcount in 2010 i In Australia, the rise in jobs in January 2010 was the largest monthly increase since December The jobless rate was at its lowest level since February 2009 ii In the UK, the job market is continuing to improve. Increasing employer confidence has resulted in the best performance we've seen in permanent employment for two and a half years, Kevin Green, Chief Executive of the UK Recruitment & Employment Confederation, March 2010 iii This growth in new hires results in a consequent growth in the level of temporary incompetence in your workforce. According to SHL research it takes between six and ten months for the new hire to reach competence iv. When you factor in the average monthly salary that you pay new hires before they reach a level of competence, the cost to your business is staggering. When, on top of this, you overlay the imperative to position your business strongly to take advantage of the recovering economy, the impact of any lag in the level of capability of your workforce will be felt exponentially in your financial results. Customer service In addition to the growth in jobs, the current business focus on on-boarding is being driven by changes in customer behaviour. v The recession has spurred consumers to spend less and to expect greater customer service and value from that spend. vi In this context no one can risk providing anything less than excellent customer service. Organisations can invest heavily in branding, but as soon as the advertised brand experience differs from the reality, you have breached your clients trust. Their assumed loyalty and your revenue will both suffer heavily. With this backdrop we are seeing best of breed organisations: using realistic job previews vii to make potential hires aware, before they apply for the job, that customer service excellence is the expectation: assessing for strong customer service orientation during the selection process through the use of personality inventories: using the ensuing on-boarding process as an opportunity to engage new recruits and instil a strong organisational value of customer service. Reducing time to competence Certainly, you need the person with the right skills and experience. But reducing time to competence is not just about making sure you recruit someone with the right technical skills to do the job. It is about ensuring you find, onboard and develop talent that is predisposed to: embrace your organisation s values; feel aligned with your organisation s strategy; be an advocate for your organisation s customer service ethos; understand your organisation s culture and decision making processes. Coming to grips quickly with many of the unwritten organisational and social norms is highly important, at management and executive level, when success depends not only on having the grey matter to make the right decision, but also on who you consult in the decision making process and how you influence others to concur with, support and implement your decisions. On-boarding for organisational growth 3

4 What do we mean by On-boarding? On-boarding is the strategic vehicle for fast-tracking new talent into, and through, the organisational labyrinth to a progressed state of productivity and engagement (SHL, 2010) O N B O A R D I N G The aim of an effective on-boarding process should be to align the new employees talents with the employers business objectives, inspire the employee to help meet those objectives and reinforce the decision made by employee and employer to join forces. viii It is an on-going process, integrated into the attraction, selection, induction, performance and initial development stages of the employee lifecycle. On-boarding can begin with the candidate s experience of the employer branding during the attraction phase of the recruitment cycle. It can even be impacted by the candidate s personal experience of the products and services of the potential employer. Its end-point can not be pre-defined for everyone. What is clear is that it does not end after the employee has been sent home after day one with the employee handbook, mind exploding with new information, maybe wondering if they have made the right decision. Onboarding can last for as long as it takes to get the employee engaged and productive. It does not end until the combined efforts of the individual, manager, peers, HR and others, a consciously competent ix employee has supplanted the seat of the day-one inductee. The financial impact of on-boarding. The cost of incompetence: A global SHL research project asked: x How many months does it take for the average worker to become competent at their job? The averages across seven different countries ranged as follows: Sweden 10.1 months; Netherlands 9.1 months; US 7.8 months; Australia and UK 7 months; Hong Kong 6.7 months; India 6.6 months. Anything that can be done to shorten this time to competence can have a significant implication for a company s profitability. So, what is it worth? If we can reduce the time it takes to get sales people effective by three to six months, this could mean half a million or a million dollars worth of revenue coming into the business earlier. (Ian Creamer, VP HR, Informatica, 2010) xi On-boarding for organisational growth 4

5 A well-structured on-boarding program, incorporating assessment, feedback and development, can greatly reduce the time to competence. What is that worth to your organisation to reduce the time to competence of your best sales people by one month? greatly increases the probability that your staff will reach a level of competence quickly and stay with you longer. What is it worth to your organisation to increase the retention rate of your competent managers by just 5%? The cost of re-recruitment The same SHL research project also asked: Thinking about all the people that you manage, what percentage do not work out and leave before they are competent in their job? The range of responses was: Hong Kong 25%; Netherlands 18%; India 17%; Australia 14%; US 13%; UK 12%; Sweden 8%. A half-hearted approach to on-boarding can lead new recruits straight to the door marked exit. In this situation the need to recommence the hiring process, taking into account the lessons learnt, is key. There are dozens of easy to identify costs associated with most hiring processes so unless you can already say that you have an efficient, cost effective process in place, your organisation will leak money every time you recruit. In addition, many organisations will not budget for re-hiring costs as they optimistically assume that their existing process will yield the most productive, motivated and committed employees. An organisation with just 500 employees whose attrition rate increases from 15% to 20% could be looking at almost 1m in unbudgeted cost. xii These are the kinds of costs that can be minimised with a robust strategic on-boarding programme. An on-boarding programme which integrates a structured assessment and development programme The cost of disengagement Fast-tracking employees to a state of competence and engagement ensures each and every new headcount adds value as soon as it is humanly possible. The business ROI of employee engagement is indisputable xiii and effective on-boarding contributes to two important and distinct aspects of employee engagement xiv, namely: Alignment: How quickly and how effectively a new hire feels aligned with the organisation s direction. Absorption: How quickly they become successfully immersed in the day-to-day activities of their job. Your on-boarding process should play its part in ensuring each employee is imbued, early on, with a sense of belonging. Each employee should get a clear insight into how they can add value and how they are valued by the business. Employee engagement will benefit as a result. The cost of poor customer service Imagine walking into a shop after seeing an advertisement for a product you are very interested in only to be greeted by an assistant who is poorly trained, ill-informed and clearly not engaged in their job. Do you still want to make that purchase? Organisations spend millions on advertising to try and to convince customers to buy their products yet seem to spend the least amount of money on the final purchasing decision stage, where good customer service is crucial to securing your revenue. Those organisations who take meaningful steps to drive consumer loyalty are 88% more profitable than those who do not. xv Ensuring, during the selection stage, that your potential recruits are pre-disposed to deliver good customer service and ensuring that your on-boarding process instils and reinforces your strong sense of customer service will avoid lost consumer spend. On-boarding for organisational growth 5

6 Practical tips for on-boarding The on-boarding process touches many stages of the employee lifecycle. It is an employee-centric process that involves multiple points of interaction between the individual and the organisation xvi and it spans the attraction stage right through to the early stages of the employee development cycle. By looking at each of the key employee lifecycle stages we have generated some practical tips for your on-boarding process with a view to increasing the speed-to-competence of your new hires and to support you in fast-tracking their engagement: On-boarding through attraction Do you have an employer branding strategy? - Have you considered how you can best use it to ensure your employees are made aware of your expectations and culture? - Are you using Realistic Job Previews to instil strong sense of your organisation culture and values early in the attraction phase? Do you have a strategy to proactively contribute to the virtual personality of your organisation? - Have you considered the impact of Web 2.0 and social media on your employer brand? xvii On-boarding through selection Have you mapped out the points of interaction between you and your potential recruits? - Have you identified the points of direct communication between you and your potential recruits? - Have you ensured that the way each of these points of interaction is handled by your recruitment team translate into real moments of truth where your organisation lives up to its employer brand? Creating bad interactions during this first impressions stage will be difficult to undo later in the on-boarding process. Does your selection process include a values assessment? - Ensuring your new recruits have the predisposition to align with your organisational values will increase your retention rates. It will avoid the they just didn t fit in around here post-mortem in six months time. - Selecting people with a good alignment to your organisation values also reduces the time it takes for them to become engaged and to start contributing to the business. Are you using fit-for purpose assessments? - Are your assessments online, easily accessible, candidate friendly, and do they provide ample opportunity for practice? It is important not to create an unnecessarily bureaucratic or awkward process for potential hires at this point. Create poor impressions at this point and it will take you a lot longer to engage your new hire. - Are you offering the candidate feedback on their selection assessments? New hires will feel more engaged and will take less time to reach competence if you share with them your views on their strengths and weaknesses in the context of the role and your organisation. - For more information on candidate management refer to the SHL s Best Practice Guide. xviii Having made your selection decisions, are you proactively keeping your new hires engaged in your organisation before they start working for you? - Harness the power of Web 2.0 applications to create a new hire community. Viral games, Twitter, YouTube, Facebook and Employee Blogs are just some of the ways in which organisations are using Web 2.0 to create a preemployment greenroom. - Start to include your new recruits in some of your corporate communications and include them on invitations to company social events. On-boarding for organisational growth 6

7 On-boarding through induction Is your job already half done? - For some, on-boarding begins on induction day. A crucial mistake to make! If you have invested in some of the above activities your chances of successfully on-boarding and retaining your new hires have already been improved. - Quality technology that minimises administration for the new hire is a given. A good HR platform will minimise disruption but do not expect it to induct your new employee. Here, technology is a hygiene factor, necessary to avoid problems but not something that will, on its own, enhance employee engagement. When planning the formal induction session consider some of the following: - Share the organisational strategy and how each person joining that day links to it. Providing this level of clarity with a new hire will help them start to feel aligned with your organisation. - Have documentation that outlines the culture, values and vision for the organisation in a digestible format for employees. - Share stories about how things happen around here. These stories enable new employees to pick up valuable cues about the social norms and the organisational culture. (See Table 1) Table 1 Examples of Social Norms what is really good about working here and what is still being worked on. Better they hear it from you than from a disgruntled employee. - Have advocates from different departments speak about how their teams fit into the organisation. - Spend time specifically focusing on the social induction. Explain the social forums in the organisation and how strong the social culture is in different parts of the business. Highlight sports teams, social groups, activity groups and other social networks that can be joined. - Information overload should be avoided. Processes that are not relevant and that can be explained adequately in a document should not be drummed into new hires. Provide as much information as possible online in a selfservice/easy access repository that can be found on an as-needs basis. Do not throw information at them on day one if they do not need it until week three. - Get senior support to deliver parts of the induction session. Do not leave it all up to a junior or nervous HR assistant to create first impressions. - Tailor the sessions to each group. Small changes to accommodate the needs of the specific new hires will be remembered and have a strong positive welcoming effect. - Follow-up on questions that the new hire asks and create information networks within the group to share information. How are decisions made? Is there a highly collaborative or autonomous way of working? - How much consultation is enough? - Who needs to be consulted? What are the forums for discussing new innovations and ideas? - How do you bring forward suggestions for improvements? - Talk through customer satisfaction surveys to help provide focus on the goals of the organisation and how the employee can contribute to these. - Talk through results of recent engagement studies to enable people to see the reality of On-boarding for organisational growth 7

8 On-boarding through performance management Have you set clear expectations early on about what success in the job looks like? - Have clear goals to achieve in the first month and meet regularly to review these. - Have longer performance goals centred on the first six-nine months of work. - Have clear expectations set around how often manager and employee will meet, e.g. meet formally four times in the first month and eight times across the three months Have you recognised in your performance goals that this person is a new hire? - Incorporate some socialisation goals in your performance plan that are related to being a new employee. This is important at all levels, but particularly so at management and professional levels where the networks that are created are likely to be crucial in how successful a new hire can become in influencing and leading others. (See Table 2) Table 2 Examples of socialisation goals Meet informally with each person in your direct network of peers. Attend six customer meetings with the senior sales people in your division. Hold informal meet and greet sessions with the people in your new division. On-boarding through learning & development Have you provided structured development support in the first few weeks? - Do not leave it until after the first performance review to tell them where they have to develop. Have you given feedback on the selection process? - Early in the induction process it is good practise to provide feedback on the selection process and on any assessments that were carried out. This will stimulate conversation around: Why you recruited them What you believe their strengths to be in the context of the new role How you gleaned this from the assessment process and assessment instruments What you want them to achieve How their strengths will help here What are their development areas in the context of the new role Their own perspective on their development needs How you will support them bridge the gaps What resources (people and content) are available to help them develop. Have you used the assessments from the selection stage to provide insight into how to build the development plan? - Assessments used at selection can be used to provide insight into a new employees preferred learning style. For example SHL s maximising your learning report, an output from the OPQ32r, provides information on how best to structure the new hire development plan such that it is more likely to be acted on and that it is in line with the new hires preferred learning style. - Competencies found to be lacking when assessed at recruitment can be highlighted and development plans put in place around these. Have you assigned a mentor? - Development can be fast-tracked by assigning a mentor early in the on-boarding process. Do you have an understanding of what drives this new hire? And have you worked out how you are going to increase their level of engagement? - Macro engagement surveys will only help you generate team and functional level interventions to drive up engagement. From the perspective of on-boarding it is more useful to focus on micro-engagement. That is to say On-boarding for organisational growth 8

9 you need to understand at the individual level, what drives and motivates your new hire and work with them to align those drivers with their working environment. Motivation inventories (e.g. SHL s MQ) can be used to ensure you understand what you can do to create an environment that will ensure your new recruit is driven to succeed. Have you scheduled in a review of the development plan? - The job, the new recruit s level of skill and their motivators will all change over time. Your development plan needs to flex to take all of these factors into account to ensure they stay on-boarded and engaged. Are you tracking progress? - You should strengthen your reviews with measurement tools that track development progress. For example, after 6 and 12 months consider the use of 360 instruments to benchmark progress against the employee s development plan. Continued development not only ensures a level of on-going competence but goes a long way towards maintaining employee engagement Key take aways: On-boarding is a process that begins a long way before the induction day and spans into the early stages of employee development. On-boarding is deeper and more meaningful than just providing an easy route through new-hire paperwork. If it doesn t, as a matter of course, contribute to employee engagement then it isn t working. Link the success of your on-boarding strategy to business results. If it is working as it should it will be reducing attrition, increasing the speed to competency of new hires and as a result improving customer satisfaction levels and profitability. Conclusion On-boarding is recognised as a critical HR process that can contribute significantly to business performance. Execute it with little strategy or purpose and it will leave your new hires questioning their decision to work for you and elongate their initial period of incompetence. A poor process will leave your new hires feeling disjointed from, rather than engaged with, your organisation and can contribute to attrition problems. Executed with thought and skill your on-boarding strategy has the power to positively impact on employee engagement, improve retention, decrease new hire time to competence and improve your bottom line. On-boarding for organisational growth 9

10 Author This paper was written by Dr Ray Glennon, Psychologist and Business Solutions Manager, SHL. April References i Onboarding: The first line of Engagement. Aberdeen Group, Feb 2010 ii Australia Job Growth Surges, Wall Street Journal, Feb iii The Recruitment and Employment Confederation (REC) and KPMG Report on Jobs, Mar iv Getting the Edge in the New People Economy A joint research project by the Future Foundation and SHL. v Onboarding: The first line of Engagement. Aberdeen Group, Feb vi McKinsey, Dec vii viii Corporate Leadership Council (2002). Building effective onboarding programs. Washington DC: Corporate Executive Board. ix x xi xii xiii xiv Getting the Edge in the New People Economy A joint research project by the Future Foundation and SHL. Assumes: 500 employees with an average salary of 30k, on-costs including average training investment, internal and external recruitment costs, assuming it takes 28 weeks to reach average performance. Inceoglu, I., Fleck, S., Bartram, D. Jan Dispositional Motivation and Work Engagement. Presentation at the BPS Division of Occupational Psychology (DOP) Conference. Bartram, D., Fleck, S., & Inceoglu, I. Apr A Comprehensive Framework for Understanding and Predicting Engagement. presentation at the Society for Industrial and Organizational Psychology Conference. PredictingEngagement.aspx xv Serving the Networked Consumer. Deloitte Research Study, xvi xvii xviii Bard, E., Glennon, R., (2010). "A progression of the candidate experience". Paper presented at the British Psychological Society division of Occupational Psychology Conference, Brighton UK. Bard, E., Glennon, R., (2010). "A progression of the candidate experience". Paper presented at the British Psychological Society division of Occupational Psychology Conference, Brighton UK. Guidelines for Best Practice in Large Scale Assessment. SHL Best Practice Guidelines. On-boarding for organisational growth 10

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