Onboarding in the Motor Industry - Why we need to do it right
Posted on 25th October 2021 at 15:09
Onboarding in the Motor Industry – Why we need to do it right
Staff turnover has long been a problem within the Retail Motor Industry, with turnover levels higher than almost any other sector, what is often not realised is how much higher it is. In the UK the average turnover rate, across all sectors is 15%, the UK Retail Motor Industry has an average of 36%, over twice the UK average. If you focus in on Sales the story is much the same, with the UK average being 30%, and the UK Motor Industry once again running at double that number at 70%.
“The UK Retail Motor Industry Loses Staff at Twice the UK Average”
Given that the average cost to recruit in the UK is £3,000, turnover of the level we experience adds significantly to the cost of operation for UK retailers and dealer groups, yet it’s often simply accepted as a fact of life, just a part of working in the sector.
While the Retail Motor Industry does have its own unique challenges and demands, by learning from other industries and sectors we can, and more importantly should, do something to reduce these numbers. To put this into cold, hard numbers, if a dealer group with 100 employees can get down from 36% to the 15% national average it would save them £57,000 a year in recruitment costs alone. That’s without factoring in the time and revenue lost to the business during the recruitment process. When this is factored in the cost rises to an average of £11,000 per person, increasing the £57,000 per year to £209,000 per year.
The numbers alone should be a call to action, which leads quite rightly to the question of what can be done? First, we need to look at why people leave, and just as importantly what makes them stay. The three biggest factors for leaving are, Income, Hostile Environment and Bad Management, with the three factors that make staff stay in a role being Positive Feedback, Good Training and Good Management.
The UK Retail Motor Industry has become locked in a vicious cycle, in which businesses feel that it’s a waste to invest in new staff because they will leave, and new staff leaving because they have not been invested in. Unfortunately, the loser here are the retailers, with the numbers discussed above showing just how expensive that loss is. It’s a cycle that must, for the long-term success and health of our industry, be broken.
This is where onboarding becomes a critical factor, as a strong onboarding programme has been shown to significantly increase levels of staff retention, by as much as 82%. Strong onboarding programmes need to be well structured, well executed, supported across all levels of the business and most importantly of the right duration.
“Strong Onboarding Can Increase Retention up to 82%”
So what factors are key to a successful onboarding programme? To understand that we first need to understand what challenges employees faced during on-boarding. Research by talentLMS into this question found the following:
- Learning the expectations of my supervisor (20%)
- Fitting in with my co-workers (12%)
- Conflicts with others I work with (7%)
- Learning how to do my job (17%)
- Finding the information I needed (16%)
- Feeling uncertain about my ability to perform well (16%)
- Feeling unprepared for performing my job (12%)
At the top is ‘Learning the expectations of my supervisor’ at 20% and understandably the biggest challenge new hires consider. Combined with ‘Fitting in with my co-workers’ (12%) and ‘Conflicts with others I work with’ (7%), they represent the Cultural challenges that Onboarding needs to address.
These Cultural aspects account for 39% of the challenges, leaving the remaining 61% of challenges focusing on areas covered by Knowledge, which break down into ‘Learning how to do my job’ (17%), ‘Finding the information I needed’ (16%), ‘Feeling uncertain about my ability to perform well’ (16%) and ‘Feeling unprepared for performing my job’ (12%).
“Knowledge, Skills, and Ability Training Solve the Majority of Onboarding Challenges”
It’s clear that onboarding needs to address a wide range of challenges and needs to be planned and structured in a manner that provides not just the knowledge a new hire requires, but also ties it directly into the Culture of the business as well. Yet despite this the majority of onboarding programs (58%) still limit their focus to the basics of process. paperwork and compliance.
Building a successful and strategic onboarding program requires an understanding of where a new employee needs to be in terms of knowledge, skills, and ability 7, 14, 30, 60 and 90 days into a role. Those milestones then need to be mapped to the training required for the job role, and linked clearly to expectations of competence, doing so allows both the supervisor/manager and the new employee to be able to gauge where they are and understand if they are on track or if additional support is required to bridge any gap.
While the exact ‘checklist’ of skills, knowledge and abilities will vary by job role, you can get a good handle on how things are going by using some broad questions as a starting point. For example, at the end of the first week do new hires now have a clear idea of exactly what the job role entails and what is expected of them? Do they know who to speak to if a problem arises, and do they believe their Supervisor/Manager is supporting them? In a similar vein, at the end of the first month do they feel they are contributing to the success of the business; do they feel part of the team, and do they have any unresolved issues?
Using broad questions such as these, at key milestones allows you to start to explore the specific knowledge and cultural challenges that drive them, allowing you to understand what your onboarding needs to offer for each Job Role.
Given what we have discussed several key factors should be considered as the starting point when building Onboarding programs.
The numbers we have discussed above make it quite clear that training, defined as the development of Skills, Knowledge and Ability, are a critical aspect of Onboarding. However, it’s important to understand both the depth and scale needed for each job role, and to then account for the knowledge, skills, and abilities your new hires bring with them, with the training structured to bridge the gap between the two.
Ensure your training plan covers everything needed, from mandatory compliance, across the day-to-day skills and ending with the skills and knowledge needed for the longer-term goals of the individual and the role. The right plan should make it clear to the new employee from day one that you have put thought and effort into supporting them not just for the first week, but right through the probation period and onto building a career for them with your business.
Training can’t be left to just structured workshops and eLearning either but needs to be supported by skilled coaching from Supervisors and Managers. Certain roles, normally those in management, can also benefit from being provided access to a mentor, either from within the business or externally.
Support at all Levels
Onboarding has been shown to be significantly more effective when it’s supported by the management of the business, from the most senior down. In the last point the importance of Supervisors and Managers providing coaching, and the use of Mentors was highlighted, and these Supervisors and Managers play an integral role in the Onboarding process.
In a similar manner having Onboarding starting with a structured event, lead or introduced by a senior manager demonstrates to new employees that the role they are to play within the business is valued and recognised from the top down.
‘Good’ takes Time, ‘Great’ takes Time and Planning
Allowing sufficient time for Onboarding should, I hope, now be clear, exactly how long will vary by role, but a good rule of thumb is that it should last for at least 90 days in total. Now you don’t need to fill every one of those days with training and activities, but a new hire should feel supported during that time.
However, time alone is only a part of what is needed, that time needs to be planned and structured.
Ensure they are being checked-in on and use the broad questions discussed above to ensure that they are on track, make sure their supervisor or Manager is meeting with them regularly and ensure those meetings are structured and constructive, and not simply being used as a ‘tick-box’ exercise. Done correctly and with well-structured coaching the manager should be able to keep the new employee on track and keep the business informed of how they are progressing and what additional support, if any, is required.
Every Role Matters
It should be clear that the exact Onboarding need of every Job Role will vary, and consideration should be given to that, based on the seniority of the role, the skills and knowledge required, and the background of the new hire.
This should form a considered part of the Onboarding for that person, for example, when onboarding a new Marketing Director it would not be unreasonable to expect them to have a 90-day plan mapped out themselves (and that may well have formed part of the recruitment process) and for that plan to be used to collaboratively form part of the onboarding process and planning. Having the same expectation for a new Parts Apprentice would be totally unrealistic, and they would need to be guided and supported much more intensively as a result.
The level of support and direct management each role required needs to be established and the expectation around it communicated to everyone involved, the only general rule that should be followed here is that ‘micro-management’ doesn’t work for anyone.
Can You Afford It?
If we are to be honest with ourselves, everything outlined above takes a significant degree of effort and time to put into place, and that’s assuming you have the resource with the skills within the business to do it! All of which comes at a cost, even if you have dedicated HR and Training resource who have the time to focus on it.
However, Onboarding is one of the clearest ‘Return on Investment’ arguments seen in business, which is why so many industries and sectors across the globe have put so much focus on it over the last few decades. At an average cost of £11,000 per person it is less a question of being able to afford it, and more of can you afford not to?
If you have enjoyed this post, please feel free to join one of our Training Focus Groups and have your say on training within the Motor Industry, contact [email protected] for details and dates.
If you would like to talk more about how training can help your organisation, please contact [email protected] to see how we can help
By Gideon Liddiard, Training Programmes Development Manager
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