The 7 stages of the employee lifecycle

From the first moment someone encounters an organization the ‘employee lifecycle’ begins. When forward-thinking businesses think about the best ways to engage with their staff at each stage of the process, the rewards can be great for everyone involved.

Defining the employee life cycle

Defining the employee life cycle

The employee life cycle takes inspiration from customer journey mapping, a tried and tested idea, where the relationship between an organization and a customer is divided into segments. Business experts see the end-to-end employee lifecycle as being made up of 7 parts:

1. Attract: Starts from the moment a future employee becomes aware of a company up until the moment they apply for a job with them.

2. Recruit: This covers the application process, every form, interview and interview task that stands in the way of a job offer.

3. Onboard: From job offer to getting employees up to speed, the onboard stage starts before your latest team member begins their first day on the job.

4. Develop: During the develop stage, businesses assess employees’ strengths, weaknesses and areas of interest to invest in improving their skills.

5. Retain: Hopefully the longest stage of them all, retaining is about ensuring staff are fulfilled at work to reduce turnover.

6. Exit: Not the last stage of the employee lifecycle, the exit stage includes receiving a letter of resignation, exit interviews and an employee’s final working day.

7. Advocate: The never-ending stage, a happy leaver has the power to recommend good employers to their family and friends long after their final paycheck.

Why is the employee lifecycle important?

Why is the employee lifecycle important?

HR teams using the employee lifecycle framework are able to evaluate investment, measure success and improve employee experience in a more effective way. The main benefits can be split in two:

Detailed optimization

By dividing the employee lifecycle into stages, HR teams gain a deeper understanding of where improvements can be made. For example, they can appraise the recruitment process by comparing new hire turnover rates with costs to hire.

If the same role is advertised on different job platforms these scores can be A/B tested too. With more data to work with, organizations have the power to customize the smallest details of the employee lifecycle for the better.

Focusing on human experiences over processes

Employee lifecycle strategies are better for measuring employee experience than other talent management strategies. Precise KPIs allow business leaders to look deeper than the data and understand the psychology of employees at any stage of their journey.

For example, HR teams using a narrower approach might look at the speed of the hiring process to decide if they’ve made a ‘good hire’. This might capture a smooth and speedy recruitment process but not a true job fit.

A company with a holistic, lifecycle-focused plan can assess whether an employee is a good fit for a role long after their first day. Promotion rates, engagement survey feedback and other data gathered across the lifecycle helps build a much fuller picture.

The benefits of an employee lifecycle strategy

The benefits of an employee lifecycle strategy

From contributing to a sense of belonging to attracting top talent, a strong employee lifecycle strategy offers businesses a wide range of benefits.

Improved retention and lower turnover

According to the Society of Human Resource Management (SHRM), the average cost of hiring a new employee is nearly $4,700. But in some cases, it might even be several times their salary, depending on the role. The right employee lifecycle strategy could drastically reduce these costs.

Better engagement

Engaged employees are more productive employees. Performance levels are boosted, more objectives are hit, and absenteeism declines. In fact, an employee strategy designed to engage staff could also lower the risk of burnout and workplace stress.

Better employee experience

The employee lifecycle way of thinking encourages HR teams to improve the employee experience at all stages of their relationship with the organizations. Targeting each stage with communications and initiatives designed to improve staff wellbeing, means workers are more likely to feel a greater sense of belonging and purpose. The uplift in mood can be passed from one employee to the next, and in turn, to customers too.

Improved reputation

Look after your employees and your reputation will look after itself. If word spreads that a business onboards staff well and gives them the training they need to progress, that company will soon become a more attractive place to work. A strong reputation for good employee relations also helps businesses become more respected in their industries and by their customers.

Recruit new talent

Savvy workers want to know they’ll be treated the right way before, during, and after they apply for a new job. A thorough lifecycle strategy will alleviate those fears and make a company more attractive for future employees – something all successful businesses rely on.

How to optimize the employee lifecycle
How to optimize the employee lifecycle

Successful HR teams are constantly looking for ways to optimize the employee lifecycle. By collecting and analyzing feedback at every stage of the employee lifecycle journey, HR teams are able to set KPIs and boost performance over time.

Here, we’ll look at some of the ways to improve employee experience across all seven stages:

Stage 1: Making your business more attractive

The best talent looks for more than a competitive salary or ‘nice to have’ perks when applying for a job. They want to develop their career at a company that stands out from the competition. Increasingly too, job candidates are looking for a sense of purpose in their work. To find your point of difference think about the products and services you offer and the ‘why’ of your business. Use this to define your values and bring them to life.

Could you be more active on social media? Speak at more in-person and virtual events? By ramping up branding activities, potential employees get a flavor of a positive company culture, something the best talent will demand from their workplace.

Stage 2: Creating a seamless application process

A successful application process should be simple and transparent. Removing stumbling blocks, like unnecessary interview rounds and websites that haven’t been optimized for mobile, will reduce the number of candidates that drop out of the process.

Manage the applicants’ expectations as early and regularly as possible. This could mean giving and sticking to realistic deadlines and being honest about the job they’re applying for. Overselling a role may impress applicants in the short term, but it can lead to high turnover rates during the onboarding stage.

Stage 3: Welcoming new starters the right way

Only 12% of employees strongly agree that their organization does an excellent job of onboarding according to Gallup. To win the approval of the remaining 88%, you’ll need to act from the moment your new employee accepts their job offer.

Invite them to that team social next week, let them know you have tickets for a big industry expo before their start date, be super-clear about what’s expected of them in their first days with you. Making your new starters feel welcome is the perfect way to start the honeymoon period of your working relationship.

Line managers should greet new starters on their first day and make sure they have all the equipment they need, including login details and passwords to get started. The best managers will discuss their expectations as soon as possible and set out a plan to make regular check-ins with their latest team member.

Stage 4: Do more to develop skills

In a recent McKinsey survey, 58% of workers said that closing skills gaps has become a higher priority since the pandemic. The need to develop top talent has never been so great.

It starts by working with employees to figure out where their strengths, weaknesses and interests lie. They may have shared their learning and development expectations during an earlier stage of the employment lifecycle journey. If so, refer to this information to show how you listen and value your employees’ opinion.

Many of the skills people want and need can already be found in the workforce. Explore the possibilities of rotating roles, peer coaching and peer mentoring to upskill teams in a cost-efficient way while building team camaraderie.

Stage 5: Keeping the best talent for longer

The best employers hold on to their staff by keeping them engaged. According to one global survey, a sense of belonging is the strongest driver for staff engagement. Software developers Qualtrics revealed that 91% of workers who feel they belong are engaged.

Forward-thinking recruiters are looking at how to maximize their diversity, equity and inclusion (DEI) efforts to keep their teams engaged. From strengthening current policies to committing to diversity and inclusion training, there’s plenty organizations can do to affect real change.

‘Stay interviews’ are an increasingly popular idea to help managers understand what motivates their employees. They’re the perfect opportunity to ask questions like: Is there anything you’d like to change about your job? Have you ever thought about leaving the company? Holding the interviews regularly and acting on employees’ responses is an impactful way to keep a hold of talent.

Stage 6: Healthier and happier breakups

Exit interviews are a must at the end-of-employment stage. Well-prepared HR teams will use the meetings to ask questions like: Would anything change your mind about leaving? Why did you start looking for another role? By asking difficult questions, companies can learn how to do a better job of retaining talent.

Employees should feel comfortable in the interviews and that their opinions will be listened to. This starts with thanking them for their service and ends with plans to stay in touch.

Stage 7: Increasing the number and quality of referrals

Employees with a positive exit experience are more likely to recommend a company than those who had a neutral or negative experience. Organizations encourage advocacy by staying in touch with their former employees and updating them on the business’ latest developments.

Alumni may be particularly interested to hear about changes their former employer made based on their exit interview. Keeping them in the loop helps to keep organizations front of mind when friends or family members are looking for new roles.

An interconnected experience

Each stage of the employee lifecycle may have its own KPIs and a wide range of ideas to improve employee experience, but they’re all interconnected.

Efforts to improve at one stage can have a knock-on effect elsewhere. For example, setting learning and development goals during the onboarding stage will affect employees’ opinions during the retention stage, when they want to be reassured their employer has invested in their career.

By taking action at one stage, the entire lifecycle will benefit – and your business too.

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