The ROI Of An Effective Onboarding Program

The ROI Of An Effective Onboarding Program
Summary: Discover how implementing a world-class onboarding program can increase profits for your organization.

How Does Onboarding Impact Your Bottom Line?

The onboarding process is becoming increasingly important when it comes to improving your profit margins. It is the process that teaches new hires the necessary skills and behaviors to become productive members of an organization. How does this impact ROI? The better the onboarding process the faster employees can reach full competency and start generating revenue. Your onboarding program also affects employee retention and productivity rates. A considerable amount of money goes into finding and hiring new talent. Low retention rates mean you are losing the money that was invested in hiring new employees and the revenue they would bring in.

The Definitive Guide To Onboarding Programs
Learn how you can transform your new employees into successful members of your organization.

In a recent study by Glassdoor, it was found that strong onboarding can improve new hire retention by more than 80%. The study also found that effective onboarding can increase productivity by 70% [1]. 77% of employees who went through a formal onboarding process hit their first performance goals [1]. Almost half of the employees who did not meet their goals did not go through a formal onboarding process [4].  Because onboarding has such a significant impact on many key factors that drive success it is important to maximize its effectiveness. The most successful onboarding programs have focus points that help improve ROI.

Onboarding Focus Points That Increase ROI

Simply having a standard onboarding process is not enough on its own. Research has proven that effective onboarding programs that emphasize these 5 points get better results.

Including Pre-Boarding Activities

Get a jump start on engagement and start the onboarding process right away. Best-in-class companies are 53% more likely than others to undertake pre-boarding and start the onboarding process before the first day [5]. Providing new employees with welcome emails, employee handbooks, tutorials and the ability to fill out HR paperwork before their first day will engage new hires early on. This will also boost new employee confidence and speed up the onboarding process.

Providing A Positive New Hire Experience

Providing a positive onboarding experience for new hires is one of the most effective ways you can improve your retention rates. 22% of new employees quit within the first 45 days [2]. The onboarding process is your opportunity to make a good first impression. New hires who have a positive experience are more willing to invest their time and energy into a company they feel is also investing in them. 69% of new employees are more likely to stay with a company for 3 years if they had a positive onboarding experience [2].

A Consistent Process

In a recent study conducted by HCI, it was found that the top onboarding challenge for L&D managers is an inconsistent application of the onboarding process [3]. Inconsistent application leads to inconsistent results and ultimately makes it difficult to determine the effectiveness of the program. To prevent inconsistent application many organizations use checklists and automated reminders to ensure the process is being completed fully.

Spend More Time Onboarding

The average time spent onboarding new employees is generally around 90 days, but they don’t reach proficiency for almost a year. This is part of why longer effective onboarding programs get better results. New hires who experience longer onboarding programs reach full competency 34% faster than those who do not [4]. Frequent check-ins and training keep new hires on track and give them opportunities to ask questions and grow throughout the first year.

Include Social Integration

Social integration plays a big role in successful onboarding. New hires who have healthy work relationships with their peers become functional and productive members of their organization more quickly. In a study conducted by HCI, it was found that 87% of the organizations who participated reported that buddy/mentor programs boosted their new hire proficiency [3]. Another study found that employees who are effective in peer interaction exceed revenue goals by 9% and improve engagement capital by 66% [6].

Focusing on these 5 points when you create and implement your onboarding program will help you to maximize its effectiveness which will increase your ROI, but there is always room for improvement. Measuring the effectiveness of your onboarding program is the next step in ensuring you are getting the most out of your onboarding process.

Measuring The Effectiveness Of Your Effective Onboarding Program

There are two types of data you will need to collect to gain a better understanding of how well your onboarding program is working. The first is quantitative and the second is qualitative. Quantitative data is numeric information that can easily be tracked and measured. This information will show you changes in retention rates, productivity and number of trainings completed. This will give you insights as to what is working and what is not. Qualitative data is information that can be observed rather than counted. This information can be gathered by conducting interviews and surveys. Asking employees about their thoughts and feelings about their onboarding experience will help you better understand the why behind the numbers. Together this information can give you a full picture of how effective your onboarding program is currently and what if any areas need to be improved.


The ROI of a successful onboarding program can create quite an impact on your organizations' bottom line. Onboarding well can improve new hire retention rates, speed up time to competency and increase productivity.

The best onboarding programs focus on these 5 key points to maximize ROI:

  • Getting a jump start on engagement with pre-boarding.
  • Creating a positive experience for new hires to improve retention.
  • Extend onboarding past the standard 90 days to ensure new hire competency.
  • Providing social integration and mentoring opportunities to boost engagement.

Implementing a standard and consistent process to better track results. Measuring both quantitative and qualitative data will help you determine what is currently working in your onboarding process and what changes can be made to maximize your ROI. The goal of an onboarding process should be to transform new hires into organizational insiders who create a positive impact. Employees who are competent, driven and productive will ultimately be what improves your ROI.

Learn how you can affect the ROI of your onboarding processes by downloading the eBook The Definitive Guide To Onboarding Programs.


[1] The True Cost Of A Bad Hire

[2] 18 Jaw-Dropping Onboarding Stats You Need to Know

[3] Infographic: Onboarding Outcomes

[4] [Infographic] The Onboarding New Hire Statistics You Need to Know (with 2018 Updates)

[5] How Does Employee Onboarding Impact New Hire Retention and Turnover Rates?

[6] Win-win engaging peers in the employee onboarding process