To illustrate the importance of an effective onboarding process for new employees, consider the Securities and Exchange Commission’s investigation of Bernie Madoff’s Ponzi scheme. By the time Madoff confessed in 2009, he had bilked 4,800 clients out of almost $65 billion. After the fact, an internal SEC report revealed that the agency could have uncovered the scam much earlier but botched multiple inquiries over a 17-year period.
What happened? The report put much of the blame on poor SEC hiring practices. Examiners assigned to the case were almost always inexperienced attorneys who had no training or understanding of equity and options trading.
While that’s an extreme example, employee onboarding remains a critical weakness for many organizations. One study finds that most onboarding processes focus almost exclusively on paperwork requirements rather than introducing employees to the culture of the organization and the expectations, skills and knowledge required for the job. This is a costly miscalculation. Companies in the U.S. and U.K. spend roughly $37 billion each year on unproductive employees who do not understand their jobs.
Breaking Old Habits
Part of the problem is a tendency to rely on legacy processes that have evolved over time. This is equally true for offboarding employees who resign or are fired. These processes tend to be highly unstructured, vary from department to department and involve a variety of paper-based tasks. Often, it’s left up to department heads to create their own ad-hoc methods.
That’s not an efficient way to operate.
Organizations must apply consistent, well-designed procedures to prepare new hires for success and ensure a smooth, conflict-free experience with departing employees. Fortunately, modern Human Resources Service Management (HRSM) software makes it easier than ever to automate onboarding and offboarding processes and ensure a best-practices approach to these critical functions.
HRSM solutions help coordinate the delivery of all necessary tax and payroll forms, benefits packages, employee handbooks, etc., to new hires. In many cases, information filed in one form will auto-populate on other onboarding documents to save time. Automated reminders help ensure the employee completes the processes promptly.
The system can also automate the creation of IT accounts. Based on department, job title or other criteria, the software will generate tickets for the provisioning of email accounts, IT hardware and key applications, along with approvals and user login information.
Lines of Communication
The HRSM system can integrate with the organization’s IT portal to help new hires connect with the information and resources they need. In addition to providing easy access to the corporate directory, the system can suggest points of contact in other departments based on job description and other criteria.
New employees are often unsure if they are performing as expected. Automated benchmarking can help them see if they are meeting organizational goals and milestones. A schedule of evaluations can be entered into the system, and managers can be automatically reminded to check in with new employees at regular intervals.
In a similar way, automation can ease the offboarding process. When an employee is leaving, the system can schedule an exit interview with department heads and managers, set a date for a final paycheck, and ensure that access to the building, servers, networks and email are terminated at the proper time.
It’s often said that people are a company’s most valuable assets and that’s not an empty cliché. Good employees drive productivity and innovation. Conversely, poor employees can be a drag on resources and morale. Given the stakes, it only makes sense to consider automated onboarding and offboarding solutions to help ensure an effective workforce.
Written and composed by Lyndsay Soprano, Director of Marketing