Most employers would agree that onboarding is a critical part of the hiring process. However, most employers would also agree that they don’t give their onboarding experience the amount of focus their new employees deserve.
So what does excellent onboarding look like and how do employers achieve it? To help me answer these questions my guest this week is Daniel Chait, CEO and Co-Founder of Greenhouse Software.
In the interview we discuss:
The importance of onboarding both as part of the hiring process and in terms of its overall business impact
- Why onboarding receives less focus than other parts of the hiring process
- What great onboarding looks like
- The three phases of onboarding
- How technology can help
Daniel also shares his thoughts on the future of onboarding as well as examples of employers who are currently doing it well.
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Transcript:
Matt Alder [00:00:00]:
Support for this podcast comes from Greenhouse Software. Greenhouse is a leader in enterprise talent acquisition software. Greenhouse’s solutions, like Greenhouse Recruiting, are designed to help talent teams find the best candidates and improve the entire hiring process. Thousands of the smartest and most successful companies like Lyft, Cisco, Meraki, Buzzfeed, Warby Parker and Airbnb, use Greenhouse’s intelligent guidance to design and automate all aspects of hiring. To learn more, head to Go Greenhouse IO podcast. That’s Go Greenhouse IO Podcast.
Matt Alder [00:01:07]:
Hi everyone, this is Matt Alder. Welcome to episode 181 of the Recruiting Future podcast. Most employers would agree that onboarding is a critical part of the hiring process. However, most employers would also agree that they don’t give their onboarding experience the necessary focus. So what does great onboarding look like and how do you achieve it? To help me answer these questions, my guest this week is Daniel Chait, CEO and co founder of Greenhouse Software. Daniel has some great insights to share on onboarding and I know you’ll enjoy the interview.
Matt Alder [00:01:48]:
Hi Daniel, and welcome to the podcast.
Daniel Chait [00:01:48]:
Thanks. Great to be here. Looking forward to it.
Matt Alder [00:01:50]:
Absolute pleasure to have you on the show. Could you just introduce yourself and tell everyone what you do?
Daniel Chait [00:01:55]:
Yes, absolutely. I’m Daniel Chait, co founder and CEO here at Greenhouse Software, Greenhouse company that makes software that helps everyone become great at hiring.
Matt Alder [00:02:04]:
Fantastic. So we’re actually going to be talking about onboarding today. Really sort of a part of the talent acquisition process that probably deserves a lot more focus than it gets. How important is onboarding? Firstly as part of the hiring process, but also I suppose, more broadly in terms of its overall business impact.
Daniel Chait [00:02:25]:
That’s a great question. I mean, if you think about it first as part of the hiring process, you know, it’s the. Obviously it comes at the end of the hiring process, but it’s really the first opportunity that you have once the person has accepted their offer to start to really accelerate their impact and their value and their connection within the organization. And so it’s incredibly important because most new hires, if they’re going to work out or not, you know, very quickly, as do they. It’s a candidate’s world, it’s a talent’s world out there now, and organizations have a real responsibility to hold up their end of the bargain. So if you look at some of the stats, there was a Gallup study that showed 33% of new hires Begin looking for their next job within the first six months of starting a job. And if you look at the likelihood to stay long term, something like 69% in one study I saw are more likely to stay with the company for three years or longer and if they experience great onboarding. So right off the bat, you can see that it’s not enough just to accept the candidate’s offer letter and then hope that they show up and become a great employee. You have to take an active role in that process from that day until they really are a full on part of your business. And so that’s where it fits in with the overall hiring process. And I think if you think about the business impact of that, it’s pretty dramatic if you consider the overall employee lifetime value of a hire. What’s the, you know, if we’re making a trade, when we hire someone, we’re paying some cost to acquire that candidate and to hire them. And then of course we’re paying their salary and benefits for their period of working here. And then they generate value over the life of their time with the company. That’s the kind of like employee lifetime value trade. Well, the longer they stay and the faster they come productive, it has huge impact in dollars and cents on your business. You need to replace that employee every year or every 18 months versus if they’re able to stay for three or four or five years. And if they get to productivity within the first month or two or three months versus taking six or 12 months to become productive, those numbers drive hundreds of thousands of dollars per employee of value. So it’s an area where companies really are wise to invest more because they get a lot out of it as well as of course, the employees getting things out of it as well.
Matt Alder [00:04:46]:
So I mean, its importance is pretty clear there. From the statistics that you’re quoting. With that in mind, why is it that onboarding receives less attention than other parts of the hiring process?
Daniel Chait [00:05:00]:
Yeah, it’s a good question. I mean, I think the proximate cause of it is just in many organizations, it’s really nobody’s job. You know, most organizations, once they get to a certain size, they’ll have a head of HR overall, they’ll have a head of recruiting. They may have heads of other areas like comp and benefits or operations, but it’s often nobody’s direct job to oversee onboarding. And so then you have to ask, well, why is that? And there’s a couple reasons. One kind of the obvious thing is like, although it’s so important as we Just talked about it has all impact on the employee and on the the business. It’s actually not technically required to do onboarding. You sort of, you have to hire the person, you know, there’s no getting around, you know, sending them an offer letter and getting them signed up. And you kind of have to like, do the stuff after onboarding, like pay the person. But onboarding isn’t technically required, and so organizations aren’t always forced into doing it. And then secondly is great. Onboarding is very holistic. And so it’s not just an HR response, but it’s as much and often more a business priority and a business responsibility. So if you think about how you would onboard, let’s say a sales rep, you know, the HR team certainly has a role to play, as does the IT department and finance and everyone else. But the sales team has a huge role to play. I mean, the knowledge of how to do a great job selling, the knowledge of how to deliver like our sales pitch and how to work with our sales software systems and do the things on your team you need to do, all that sort of context that really comes from the department that you’re joining or the team that you’re joining, it doesn’t really come from hr. And so because it’s not technically required to move the process forward, therefore it’s kind of no one’s job. And also because it’s such a holistic endeavor, it has no one owner. And when something has no one owner, then it doesn’t end up getting done in many organizations. So even though it’s so key, it’s so important. Traditionally only the paperwork and getting you your computer and signing up for taxes, the stuff that really does have to happen gets done and the rest of it gets a lot of overlooked often, absolutely.
Matt Alder [00:07:18]:
That makes perfect sense. And I couldn’t agree with you more. It always seems to be the focus on the actual mechanics of the process of someone becoming an employee. So what does great onboarding look like?
Daniel Chait [00:07:34]:
So great onboarding, I mean, it’s a rich topic. We could do, you know, we could do several weeks of just that. But maybe I’ll summarize it this way. If you think about three phases of onboarding, so the first phase would be what I would call pre boarding. So the moment the person accepts their job offer until the moment they start that period is incredibly overlooked. But you really have in that point a unique opportunity and also some unique risks. Right. So again, getting back to this idea that organizations only start by doing the things they have to do once You’ve accepted the offer, which you kind of have to do. There’s nothing else you really have to do. So most organizations do very little until the person shows up on the first day. But of course during that period you’ve got this great opportunity to start bringing that person into your organization. You can have them start to do some of the paperwork processing, you can have them start to learn a lot about the company and the organization, about the history, about the team they’re going to join, and you can start to have them feel really good about this transition they’re about to make. And so by providing them information, by asking them to start participating, and by sharing with them some connectivity to your company’s culture, you can bring them way further along so that on the first day they’re really well prepared and really well situated to get off to a great start. At the same time, you do have some risks during that period. I’ve certainly had the experience, I know many others have of working really hard, getting a great offer out there and hiring someone. You have to then turn to your sort of silver medalist and tell them, unfortunately we’re not going to move ahead with you. You seem great, but we’ve hired someone else. So you’ve kind of cut off all your options. And then the person you’ve hired doesn’t show up on their first day, something goes wrong, they get a counteroffer from their job, something changes in their life, whatever that is. Now you’re in a real bind because you’ve closed off your search, you’ve moved on to other things, you’ve told other people no, and this person you were counting on doesn’t show up. The risk is that by just ignoring the person throughout there, you’re not aware of these changes or any change in their thinking that may happen. So staying in touch with them is not only about the acceleration you get from that person, it also really can help protect the company in that pre voting phase from any unforeseen changes. Now the first day, that’s where you obviously have now you’ve got the person moving from being a candidate or not an employee to really being a full time employee. And most organizations have this once in a lifetime moment where they can make that first day really special and really memorable and they drop the ball. Most employees first day is spent handing us HR hands you a stack of paperwork. It feels like disorganized and you feel kind of alone. And all the worries and all the fears you had about this new job, am I right for this role? Is this the right company for me? Did I make the right move? Those start to creep in and the company is just giving you all this stuff to do. So if you’ve been well, pre boarded, there’s a lot less stuff to do. Company can also spread that work out. They can help automate it. They can design the experience to be a little bit more lovely, but they can also engineer some moments there that can help you feel more comfortable. They can have your teammates be sure to stop by and say hello. They can have people from around the company who aren’t your teammates, maybe a mentor, maybe someone else in a team they’ll be working with stop by and say hi. One of the things I’ve seen that works really well is to make sure the people who interviewed you know that you’re starting that day and to have them come by and say, hey, Sally, I remember when I met you during the interview how excited I was about the opportunity for you to work here. And I’m so glad to see you’re here on the first day. Just wanted to stop over and say hi. Those things are really memorable. And then you’ve got kind of the post onboarding phase where you’re moving from being a brand new hire into a fully fledged employee, a welcome kind of leader within the organization and part of the culture. And that can take some time. And so it’s important not to forget that what happens in the next 30 days and the next 90 days is also part of onboarding and making sure that you have what you need, not just to get started on work like a computer in your accounts and logins, but that you have what you need to be successful and to grow and to prosper. And so those are things like, do you understand the company’s vision? Do you understand how you play a role in helping the company achieve its goals? Do you understand what your team and manager expects of you? Do you understand what the path is for you to excel and to do great things? Again, that’s a, that’s a collaboration between the HR organization and the team that you’re onboarding into.
Matt Alder [00:12:04]:
That makes perfect sense. Any employers that you’re aware of who are doing a really great job of this?
Daniel Chait [00:12:10]:
Yes. Despite the dire warning I was giving earlier about how few companies do it and how overlooked it is, actually, there are many that are doing it. Well, a couple that come to mind, customers of ours. One would be Cheetah Digital. So Cheetah Digital is a digital firm located here in the New York area and they’ve really taken a Cohesive and kind of seamless experience across all departments and functions. And then their global HR team has kind of optimized that process so that a lot of the tasks are very automated. There’s a seamless online experience and from the end user standpoint, that is the employee being onboarded. You really feel like the company has invested in making that experience modern and seamless, which I think communicates the value of it in a way that you can’t get many other, many other ways. Because you know, when something is done by an organization that is kind of like second class work, you know, they hand you a paper clipboard instead of a nice app. People are not really paying attention to it. Nothing really automated. And when companies care about things, they deliver first rate digital experiences. And Cheetah knows that. And they’ve done that in Onboarding. As I was thinking about another, another customer of ours who’s I think done a great job is Percolate. Percolate actually took the time to write up a blog post that’s on their website. You can go have a look at it outlining the onboarding experience and sort of what it looks like. And they give a tremendous amount of really transparency throughout the organization about onboarding, what it’s like to onboard as a new person, what you should expect of us when you onboard here at Percolate. And that helps establish accountability within the organization so that every new hire is set up for success. And so they have this like big day one documentation, they call it day one at percolate, which is a big 18 page document or something which really outlines everyone’s role and everyone’s responsibility and is like online trackable so that as a new hire at Perklay, you’re really welcomed in and you really can see and any of us can go to their website and see what it is they do that really helps to give them an edge.
Matt Alder [00:14:21]:
So I think you’ve kind of alluded to this a little bit, but how can technology help drive great onboarding?
Daniel Chait [00:14:29]:
Well, great technology is an enabler of this type of work. Of course, everything I just said and more you can do sort of on paper. But it gets really challenging to coordinate all the effort and all the tasks. It gets challenging to make sure it’s done consistently. And then of course, if you’re going to deliver a real winning experience, today’s world that often means doing things that fit seamlessly with people’s online lives, work lives and home lives. So you can do things like for example, you can set up it and benefits Training online. You can have new hire paperwork completed online virtually even before they start, so that your first day isn’t locked in a conference room with a stack of papers. Hiring managers can create their own tasks and templates for how they employ, how they onboard new employees, that they’re sure that, like, when somebody joins, they’re added to all the right meetings, they’re given all the right trainings, they’re added to all the right slack channels and these sort of things. And so in addition to just making sure that things happen in an automated way, these types of tasks and toolkits can set up a much more seamless and much more enjoyable experience. And then you can sort of take it to the next level and say, okay, now we’ve taken care of the kind of paperwork piece, the sort of, you know, administrative piece. How do we give someone a great experience and how do we connect them to our culture? And so what you see great organizations doing with technology is they’ll create lots of rich content, they’ll create videos, they’ll create company timelines, they’ll create recordings of key moments like big all hands meetings or staff meetings, the presentations that may have been done. So that way, when I show up at an organization, everyone else who’s already been there before me has seen those things live. I’m not at a disadvantage, but I can kind of go through those same rich experiences and get to know the organization, get to know the people and the culture. And then I think the last thing to pull it all together is most organizations, as much as we can talk about all these things, they don’t actually have a great way to know if it’s really happening. And so the lack of data around what’s happening in onboarding around your organization is a real blind spot in many companies. And so the last thing that you can do with great technology is that you can start to collect data around onboarding across the organization so that you can see, for example, the answers to important questions like how long does it take us to onboard a new salesperson? Or what. Which of my organizations or which of my teams within my organization are doing a better or worse job of onboarding new employees when you have those data, that really allows you to start to target improvements and understand what’s working and really communicate the value of doing onboarding consistently, which just doesn’t happen in most organizations, as I mentioned.
Matt Alder [00:17:13]:
So final question. What does the future look like? What would you expect to see happening in onboarding in the next two to five years?
Daniel Chait [00:17:22]:
Yeah, I mean, I think One thing that we’re going to see is just it’s going to be a much more first class part of the organization. As I mentioned earlier, historically you had recruiting and then you had HR and kind of onboarding fell into this gap. But I think the pressure on employers to not only acquire and compete for talent, but to keep that talent productive and engaged and happy is just getting higher and higher. And so it’s no longer optional, I would say, for companies to excel in this area just because the costs are too great to miss out on and the benefits of doing great onboarding are too high. So I think we’re starting to see this already is onboarding taking on its own kind of centralized first class role within HR and that the rest of the organization at the business units are taking on their own responsibilities to make sure that new hires are onboarded just dramatically. And then the second is just going to be the continued role in technology in that evolution. I mean, I think just like everywhere else, we’re seeing whether it’s in learning, whether it’s in pay, and of course, whether it’s in recruiting, you’ll see the same in onboarding, where the technology stack is getting more robust employees and employers are getting more sophisticated and more modern tools that just mirror the kind of modern experiences that we all have come to expect in our own lives. And we have powerful touchscreen supercomputers in the palm of our hand and little lamps that I can talk to and turn on the lights and play music and cars are starting to drive themselves. And so people just have a higher and higher expectation that technology can play a role here. People have much more nuanced and sophisticated and modern tools to help them keep doing these things better and better.
Matt Alder [00:19:06]:
Daniel, thank you very much for talking to me.
Daniel Chait [00:19:09]:
Absolutely. This is a pleasure.
Matt Alder [00:19:11]:
My thanks to Daniel Chait. Before you go, I just wanted to let you know about a couple of events I’m going to be at over the next few months. Firstly, I’m going to be speaking and podcasting from TA Tech Europe, which takes place in Lisbon, Portugal in early May. I’d highly recommend TA Tech to anyone who’s interested in innovation in recruiting technology. And you can buy tickets to their events in North America and Europe by going to www.tatech.org events. Secondly, I’ll be recording a live episode of the podcast at RecFest in London in July. I’m going to be joined by Ben Gledhill from Yodle, Andrew Sohn from Accenture, and Megan Butler from Cognition X. And we’re going to do a deep dive into the topic of recruiting automation. You can buy tickets to Wreckfest@www.wreckfest.co.uk. finally, if you’re an event organizer and you’re interested in having the Recruiting Future podcast at your event, then please email me on mattashift.co.uk you can subscribe to this podcast in Apple Podcasts or via your podcasting app of choice. The show also has its own dedicated app, which you can find by searching for Recruiting Future in your App Store. If you’re a Spotify user, you can also find the show there. You can find all the past episodes@www.rfpodcast.com on that site. You can subscribe to the mailing list and find out more about Working with me. Thanks very much for listening. I’ll be back next week and I hope you’ll join me.
