Retaining New Hires Now Seen As a Critical Issue

Executives report that retention of new hires has reached a critical state in their organization, a recent survey shows. Here are some possible solutions to the problem.

May 12, 2017 – Retaining new hires is on the minds of leaders at the vast majority of companies these days, according to a recent report by Korn Ferry’s Futurestep division, which provides advisory services and recruitment services for middle to upper level management.

Ninety percent of the executives surveyed, in fact, said this is an issue for their companies. What’s more, 10 to 25 percent of their new hires depart within six months, said the majority of leaders polled. That is causing big problems, and a major rethink, among talent acquisition leaders around the country.

The biggest cause of such departures, according to the study, is that the actual job differs from what the new recruits expected when they were going through the hiring process. “With low unemployment rates and increased need for specialized talent, keeping new hires is a critical issue,” said Bill Gilbert, president, North America, Futurestep. “It is incumbent upon recruiters and hiring managers to paint a clear picture of what will be expected of the candidate in his or her new role, and make sure promises of resources, job structure and reporting relationships are fulfilled.”

Matthew J. Schwartz, president of MJS Executive Search in Scarsdale, NY, said that the recruitment process must be a two-way street. It’s critical for employers to give candidates the freedom to ask questions and to learn as much as they need as they move through the recruitment process. “It is important that a candidate has the opportunity to interview the organization as much as they are interviewing them,” he said. “The more the candidate is aware of the opportunities, as well as the challenges the better equipped they will be to be effective in their new role.”

Culture Matters

Oftentimes, new hires discover once they get into the job that the company’s culture is not to their liking. Nineteen percent of the executives surveyed, almost one-fifth, said that’s the reason new employees leave. “Especially for Millennials, company culture is key to job satisfaction and companies must ensure they are correctly portraying the culture during the recruiting and onboarding processes,” said Tim Powell, managing director of Futurestep’s ANZ operation.


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HR professionals are increasingly concerned about how to best cater to Millennials’ workplace needs. Talent acquisition leaders recommend certain employee benefits to help mangers bolster their appeal. Problem is, it’s not working.


Recruiters, for their part, can also help avoid the loss of new hires. Dan Ryan, principal of Ryan Search & Consulting in Franklin, TN, explained that because his firm recruits at the mid- to senior-level roles, he seldom encounters such a Millennial mindset about culture, though generally speaking he considers it somewhat exaggerated.

All the same, search firms have to make culture a priority, or they – and their clients – will pay the price. “We take time to get to know our clients well and this includes understanding their culture,” said Mr. Ryan. “Also, we use a strong assessment process that enables our clients to learn more about the candidate prior to them stepping in the door for the new role.”

Among the best ways to retain employees is to have a good program to introduce new hires to the company. Of those surveyed, 98 percent said that onboarding was a key factor in keeping new talent. Sixty nine percent said their companies have formal onboarding programs for all of their employees. For many, though, those programs are limited. Twenty three percent of the executives surveyed, close to a quarter, said their onboarding is for only one day. For 30 percent, the programs run just a week.


Feedback Loop

Today’s challenge is no longer identifying and sourcing candidates, but getting their attention. To do this, organizations are highly focused on perception. They are anxious about what’s being said about their workplace environment and culture. Social media forums that were once used by disgruntled employees are now channels for job candidates to seek balanced information about companies. Past, present and future employees, it seems, are all in one giant feedback loop – and their opinions matter more now than at any other time.

In a recent Mullin International online poll, off-boarded employees have been shown to have increasing influence over prospective employees’ decisions to either approach or avoid a company. In fact, more than four out of five respondents said they were increasingly concerned about exiting employees’ impressions. Effective outplacement can minimize the negative effects of downsizing on company reputations.


“Onboarding must be about more than just the basic administrative processes such as entering time, submitting paperwork and logging onto the intranet,” said Mr. Gilbert, of Futurestep. “It should be an in-depth process that introduces the new hire to company culture, vision and strategic priorities, and should also help new hires understand available development opportunities to help them succeed in the organization.”

Mr. Schwartz, of MJS Executive Search, said companies can benefit by going more in-depth with the new hire during the initiation process. “As part of the on-boarding process a psychological assessment that is both written and via in-person interview can be very helpful to the placement’s future success,” he said. “This evaluation should not be used as a ‘go’ or ‘no go’ plan in hiring the right candidate, but instead be used as a roadmap on how senior leadership can support this person through training/ coaching or with additional resources.”

Oftentimes, however, the issue is more basic. “Employers need to go to great lengths to make sure that all is ready when a new hire comes on board,” said Mr. Ryan. “This ranges from connecting them immediately to peers with similar interests, making sure all technology and workspace is in order from the first day and also pairing them with a potential mentor or caretaker to answer any of those obvious questions that will occur with any new hire.”

Adjustment Period

Data collected during the recruiting process can be a great help with onboarding. Forty two percent of the survey respondents said they use candidate assessments and the like to help in the onboarding process. “Many of today’s assessments provide a treasure trove of information about the candidates, such as their competencies, traits, drivers and experiences,” said Futurestep’s Mr. Powell.

Mentorship programs are also useful. Ninety eight percent of those surveyed agreed that formal mentoring programs would be beneficial in getting new hires acclimated, but 47 percent said their companies have no such programs.

“Mentor programs are not only beneficial for new hires to learn about an organization, they also benefit existing employees by helping them understand the viewpoints and experiences of those new to the company,” said Mr. Gilbert. “This allows them to have different insights and encourages them to become more agile as they go about their jobs.”

Mr. Ryan takes a positive view of new hires and keeping them with one’s company. In large part, it’s a matter of give and take. “Caring for new hires is similar to what newlyweds go through,” he said. “There will always be an adjustment period, but if both parties listen well and adjust when needed, the new work relationship typically works well. In situations where one party or both have concealed something during the recruiting period, these things will come out when the new hire comes on board and that is where many of the issues take place.”

Contributed by Stephen Sawicki, Managing Editor, Hunt Scanlon Media

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