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Digital Employee Onboarding: Pros and Cons

October 27th, 2023 | 2 min read

By Dana Vincent

Time is one of the most precious resources a growing business can possess. There never seems to be enough. How often do you feel there simply aren’t enough hours in a day to cross everything off your to-do list? As we head into 2024, it’s important to reflect on your growth over the past year.

If you’re one of the 58% of organizations still relying on physical paper records and manual data entry when onboarding employees, this exercise may leave you feeling a little exasperated. It’s hard not to feel like taking two steps forward and one step back with each new employee when it takes over six months for some companies to reach a break-even point on their investment.

Lift HCM is an independent provider of human capital management services that’s helped companies adopt digital solutions aimed at maximizing the efficiency of employee onboarding while minimizing administrative burden for over 50 years. Let’s weigh the pros and cons of going digital to see if you’re “on board” with electronic onboarding in the new year.

Pros

Electronic onboarding is significantly faster, reducing the time from hiring to an employee's first productive day. Consider how often an internet browser like Google Chrome fills in an entire form without requiring you to press a single key. A digital solution also eliminates the risk of entering inaccurate information into legal documents and tax forms due to poor penmanship. You don’t want to get audited because Janice’s “r” looks like an “l”.

Improved Compliance

While we’re on the subject of auditing, digital onboarding systems provide a means of programmatically enforcing compliance with local, state, and federal regulatory requirements as new hires complete and submit their employment documentation.

Reduced Administrative Burden

Automating the submission, collection, and storage of employee records can significantly lessen the administrative staff and HR personnel. Digital onboarding systems provide even more value on this front for small businesses wherein it falls on leadership personnel and executive staff to facilitate these tasks.

Long-Term Cost Savings

Over time, electronic onboarding can result in savings on paper, printing, storage, and manual data entry costs. Digital recordkeeping also makes it infinitely easier for accountants to access the data they need come tax season.

Accessibility

Remote and mobile access to onboarding materials is convenient for both HR and new hires.

Enhanced Employee Experience

Varying reports list that new employees are asked to complete an average of between 41 and 54 administrative tasks associated with their onboarding. This means there’s ample time for this to sour them on the company and its bureaucracy right off the bat. However (keeping in mind that submitting employment documentation digitally is objectively faster and easier on new employees), a study by the Brandon Hall Group found that good onboarding experiences were linked to a 82% increase in retention and a 70% increase in productivity.

Cons

Initial Investment

Electronic onboarding requires an initial investment in software, hardware, and training for employees.

Technical Support

Depending on the complexity of the system, technical support may be necessary, incurring additional costs.

Data Security

Protecting sensitive employee data via on-premise servers requires additional and ongoing security measures, which may involve additional expenses. It’s worth noting, however, that digital onboarding platforms which offer secure cloud storage eliminate this concern.

Finding a Digital Onboarding Platform

Electronic onboarding offers numerous benefits by way of employee experience, efficiency, administrative burden, compliance, and long-term cost savings in the long run. While there is an initial investment and potential ongoing costs associated with electronic onboarding, the long-term benefits often outweigh these expenses.

The choice between manual and electronic onboarding depends on the size and resources of the restaurant and its willingness to invest in modernizing its HR processes. Small businesses with minimal hiring needs might find manual onboarding sufficient, but as they grow, the benefits of electronic onboarding become more compelling. If you’re interested in learning more about electronic onboarding solutions, it may help to develop an understanding of how they're being implemented in a given industry and the benefits they impart.

Dana Vincent

Dana Vincent is a seasoned Business Development Manager, who supports business owners in finding the right solutions for their payroll and HCM needs. Dana comes from a background in restaurant management, and has used that experience to understand the needs of small business owners. From small companies to large, Dana can help them with tools that can streamline their processes, enhance their compliance, and aid in their talent management. Outside of work, Dana is kept busy with her family, training her young dog to stop jumping on people, and renovating her 100 year old home.

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