The onboarding process is crucial in securing a new employee’s loyalty. It doesn’t end when they start working. According to a Jobvite survey, 30% of new hires quit their job within the first 90 days, citing reasons such as unmet expectations (43%), specific situations (34%), and poor company culture (32%).
This makes it clear that ensuring a positive initial experience is essential to retaining new talent. Achieving this goal is not solely the responsibility of HR; it requires the participation of the entire organization, from the leaders to the frontline staff. A high turnover rate can significantly impact the company’s development, productivity, and image, making it more challenging to attract new talent and causing economic losses.
The Impact of a new employee’s departure can be categorized into three levels: financial, brand image, and workplace culture Impact.
The Financial Impact is the most tangible and measurable of the three. The SHRM study found that it costs a company 6 to 9 months of an employee’s salary to replace them. This includes recruitment and training costs, which can cost tens of thousands of dollars. For example, if an employee earns $60,000 annually, it would cost the company $30,000 – $45,000 to replace them.
The Employer Brand Image Impact is the organization’s perception in the labor market. High turnover of new collaborators can create a negative employer brand, making it challenging to attract top talent. The younger generation, especially Generation Z, has high expectations for their workplace, such as proactive communication, robust connections, and transparency. Therefore, it is essential to have a positive brand image to attract and retain talented employees.
The Workplace Culture Impact is the effect that a new employee’s departure has on the existing team. When a new hire leaves, it can lead to disappointment and decreased morale within the group. Additionally, the new employee will require support to understand the company culture and internal processes to reach the expected level of productivity. According to Oxford Economics & Unum, this can take up to 28 weeks. Therefore, it is crucial to provide new hires with the necessary support and resources to integrate successfully into the team.
How can we proactively mitigate the negative impacts of high turnover rates among new hires?
To address this challenge, we need to shift our focus towards a more proactive approach to talent attraction and retention. We must start by thoroughly diagnosing our recruitment and onboarding processes and ensure we measure and track the right metrics to assess their effectiveness. This means providing real-time feedback to new hires and involving leaders in supporting and guiding them. With access to timely information, we can identify and address issues early on and create a culture of continuous improvement that fosters engagement and loyalty among our new talent.
How can companies approach a change in mindset during the hiring process to improve new employee retention?
One approach is to operate agilely and use a tool or system to visualize where potential issues may arise. The first step is to plan and determine the areas of concern, which can be measured using key performance indicators (KPIs) such as the employee Net Promoter Score (eNPS), satisfaction levels, and Performance and adaptation to the new role. By tracking these metrics, companies can identify potential problems early on and take action to address them before they escalate.
The first 90 days of a new hire’s employment are critical for predicting the risk of losing new talent and identifying future stars in the organization.
To achieve this, it is crucial to implement a strategy that involves prompt action and quick learning through fast measurements. The relevant KPIs, such as eNPS, satisfaction, and adaptation/performance, should be measured in real-time to take preventive actions and anticipate the risk of losing a new collaborator.
This strategy is not solely the responsibility of the HR department but also the direct leader’s responsibility, as their feedback on the new hire’s performance will help prioritize and focus efforts. Continuously reviewing and tracking the relevant KPIs is vital, as analyzing the Impact of actions taken and quickly learning from mistakes to act in real-time with certainty.
Retrospective analysis can be used to order the results and identify areas for improvement to constantly evolve the talent retention strategy.
Adopting a real-time data-driven decision-making approach can be challenging, but it leads to a better image, enviable work culture, and empowered leaders who can positively impact their teams. Having the right tools and information is essential to give it our all on the field, not just for 90 minutes, but for the entire first 90 days. By implementing this strategy, companies can increase their chances of retaining valuable talent and identifying future stars.
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