The role of onboarding in employee lifetime value: Part 1

6 mins, 48 secs read time

People teams sometimes find it challenging to communicate the value of their work or to be considered true business partners by their executives. That’s why our VP of Strategy, People, & Marketing Maia Josebachvili began writing and speaking on the topic of Employee Lifetime Value (ELTV). In this series, we’ll be sharing how the People team at Greenhouse considers the work that they’re doing in relation to ELTV and share a few tips on how you can think about your own work through this lens.

At Greenhouse, our People department consists of Talent Acquisition, People Operations, Employee Experience, and Talent Management. In this post, Director of Talent Acquisition & Management, Cheryl Roubian, shares the role of onboarding in employee lifetime value.

Onboarding’s role in ELTV

As People People, we know that investing in great onboarding makes for more engaged employees. Our challenge is to build and run effective programs AND show the return on that investment to our leadership. It helps that the data backs this up: Studies show that organizations with a strong onboarding process improve new hire retention by 82% and productivity by over 70%.

In this post, I’ll review:

• Employee Lifetime Value (ELTV), a framework for demonstrating the value of investing in good people practices
• How we built Greenhouse’s onboarding program, and
• Some things we’ve learned along the way

What is ELTV?

In short, we can use ELTV as a tool to illustrate that investing time and resources at various points in an employee’s lifecycle creates measurable and significant returns for the organization. The graph below presents ELTV in terms of the employee lifecycle, with time on the X-axis, “output” on the Y-axis, and four points representing a few of the more obvious inflection points in an employee’s lifecycle. When we talk about ELTV, we’re talking about the area under this curve.

Worth noting: We don’t calculate ELTV as a hard number at Greenhouse because: a) there are too many variables to be able to quantify “output” effectively, even for salespeople, and b) it’s not necessary.

Instead, we take measurements at various inflection points along the curve—e.g., the point at which someone is fully ramped—and then work to move that point, e.g., ramp people better/faster. When we move the inflection point in the right direction, we increase the area under the curve. By demonstrating how much incremental ELTV is created by the movement of the inflection point, we can demonstrate the return on the investment of time and resources.

Inflection points

When you look at the employee lifecycle, one of the first inflection points is the point at which a person is fully ramped into their role. I inelegantly refer to this as the “onboarding dot,” which you see (second from the left) in the graph below.

A good onboarding program sets new hires up to be more successful in their roles sooner. In terms of the ELTV curve, this means the “Onboarding dot” moves up and maybe even a little to the left, increasing overall ELTV (illustrated below).

Greenhouse’s onboarding program

To set our new hires up for success, our goals for our company-level onboarding program at Greenhouse were pretty simple:

1. Make sure new hires feel comfortable and welcome
2. Set context so new hires understand how their role fits into the larger organization
3. Make it easy for existing employees to be involved/engaged in the process of bringing on new people
4. Optimize for speed over perfection, i.e., build a minimum viable product and iterate/improve the program as the company grows and our onboarding needs change

Rather than detail the content and scheduling of our onboarding program, I want to share the two best things we’ve done to reach our goals and move that “onboarding dot” for our new hires: 1) pre-boarding and 2) cross-company, employee-led onboarding.

Pre-boarding

As soon as our new hires sign their offer letter, they have access to Greenhouse Onboarding. It does three cool things for us:

1. It helps new hires get to know the people and organization before they walk in the door on their first day.
2. It gives new hires a chance to help the org get to know them.
3. It allows new hires to spend their first few days learning, rather than filling out forms and signing things—Greenhouse Onboarding takes care of most of that ahead of time.

We also have a buddy program—one of a bunch of grassroots initiatives that was started by someone who thought it was a good idea and then handed off to our People Team. Each new hire is assigned a buddy who reaches out to the new hire before their start date. It’s a great way for new hires to get to know people in a less formal way and gives them a friendly face in the office on their first day.

Cross-company, employee-led onboarding

It feels a little like cheating, but we accomplished a bunch of our goals with one formula:

1. Ask the people who know the most about different parts of the organization to talk with new hires about what they know
2. Help those people organize themselves and their content
3. Make it super easy for them to autonomously deliver their content for every class of new hires

The program is a mixture of discussions, activities, and lunches, spread across the new hire’s first four days. Each session has a “team” of 3–8 people who take turns running that particular session each week. Each “team” has a lead, who is in charge of making sure the content stays fresh and that the rotations go off without a hitch.

The result: We have over 40 Greenhouse team members who volunteer their time to be part of onboarding each class of new hires. New hires get an introduction to and perspective on each of the other departments in the org. And we give existing staff a way to be involved in onboarding. Lastly, by spreading session ownership across these mini-teams, we were able to stand something up really quickly and have been able to adapt each part of the program pretty easily over time.

What we’ve learned and advice on building your own

In each iteration of the onboarding program, we’ve learned some pretty valuable lessons. Here are the ones I’ve found most impactful.

Understand the landscape of what’s already happening in your organization. Then organize it.

Some questions to help you get started:

• What information are your managers already trying to get to their new hires?
• How are they currently doing it?

Identify the pain your organization is feeling as a result of the way you do (or don’t do) onboarding. Then build a program to solve those problems.

Some questions to help get you started:

• What’s the pain your hiring managers are feeling with their new hires?
• This might take the form of questions they find themselves answering over and over again or frustration from other teams as they try to work with new hires who haven’t been set up for success. Don’t try to make these up yourself—go around and ask managers to tell you about the pain they’re feeling!
• Are new hires feeling good about their first few weeks? If not, why not?
• What kind of information and context do people need to be successful in their jobs?

Find out who wants to be involved with onboarding. Then leverage the heck out of them.

Some questions to help get you started:

• [By department] Has anyone on your team expressed interest in onboarding?
• [By department] Does anyone on your team want/need an opportunity to practice their:
• Sales pitch?
• Customer onboarding spiel?
• Product pitch?
• Public speaking?

Summing it up

In this post, I shared a little bit of theory, a lot of practice, and some learnings. I hope you find this helpful as you build or optimize your onboarding programs. Please share comments about your experiences building onboarding programs below. You can also find Part II: Framing Onboarding success in ELTV here.