Two weeks ago, I saw some twitter conversation that included the word “onboarding.” Every time I see this word in print, or hear it in conversation, I put bandages on my ears in a futile attempt to stop the bleeding.
“Onboarding” is a new term that financial institutions and other businesses are using to refer to their processes for welcoming a new customer or client. The goal of “onboarding” is to earn revenue for the company by selling more products and services in the critical initial phase of the new customer/business relationship. There are valid reasons both for and against using the term. Let me see if I can do justice to the “pro” side; feel free to weigh in with your own thoughts! If I’m missing great arguments for the pro side, I’d honestly like to hear them.
Pro: How a business handles contact and communication with a new customer can be complicated. We need a term that encompasses this process, and onboarding is much more than simply welcoming a new customer. If a business “onboards” a customer correctly, it will result in additional revenue for the business. Onboarding methods, processes, scripts, and materials can be evaluated to gauge maximum effectiveness.
Cons: Onboarding is consultant-speak or business-speak substitute for the perfectly valid word “welcoming”. There is no place where the word “welcoming” or “welcoming process” would not be a better word than “onboarding.”
One problem I see arising from using “onboarding” is that words intended for internal use frequently make their way to the members/customers. Onboarding will be no exception. I’ve seen a newsletter where the marketing department asks members to evaluate their “service levels” and “service behaviors,” and also talks about a certain promotion being available only for “new money.” These words make sense to management, but really don’t make sense to a customer. You may think that it’s preposterous that someone on some front line somewhere will use the word “onboarding” to a customer, but trust me, if management keeps using the word, it’s GOING TO HAPPEN.
But even if no front line person EVER utters the word “onboarding” to a member, the more important ramification is in the attitude that it fosters within the organization itself. By using this de-humanizing impersonal word, management is conveying to people within the organization that it really doesn’t care about its customers as people. That attitude may be fine for a bank, but doesn’t fly for a credit union. So let the banks have this word. Maybe it reinforces for bankers that it’s all about the bottom line, and people just happen to be walking money factories. In the credit union world, people are not *supposed* to be a means to the bottom-line end, so it would behoove credit union management to carefully weigh if they want to feel “cool” and “superior” to their members by using impersonal jargon for a process that ought to be VERY personal.
In World 2.0, successful businesses are ones that listen to their customers (or members). Therefore, there is only one welcoming technique that works. It’s not about trying to sell them more things (which will only serve to alienate them, no matter what you call it.) It’s about making them very comfortable with their current decision, whether it’s to open a checking account, get a loan, a credit card, or make a deposit. Only when they are VERY happy with you will they want to purchase even more items from you. In fact, that may be the very thing that customer/member is testing your organization for in the first place.
Sharp business people know that when trying out a new business supplier relationship, you start with a small test project to see if you are going to get along with your new business partner and that expectations of quality and timeliness are going to be met. Once the small project goes well, then more and more business will be done with the new partner. The same is true with new business/customer relationships. The customer is going to try your business out in a small way, by bringing just one small piece of their business to you. Only if they are really happy, will they bring you more and more of their business, and ultimately completely switch to you from whoever was their previous supplier. So they might very well be testing you to see if you are a pushy salesperson for more of their business, in which case your efforts will backfire.
As far as I’m concerned, the right thing to do to welcome a customer to your firm is to thank them for the business, ask them how it’s going so far, ask them if they have any questions or concerns, and then LISTEN. If they have more business to do with you, they will let you know. If they have a problem or concern with what’s transpired so far, it’s a great opportunity to learn something new about your business that you didn’t know previously, in which case you should thank them for bringing it to your attention.
But I don’t know, maybe this whole “onboarding” process is much more complicated than I think. Your thoughts?
Tags: behavior, business behavior, onboarding, welcoming
EverythingCU.com World 2.0 Adventure 
September 18, 2009 at 12:04 am |
Update: I just did a Twitter Search on Onboarding and discovered HR professionals have already adopted this word to describe the process of bringing new hires up-to-speed in the company as rapidly and successfully as possible. Again, I have to ask, if you are a new employee, would you rather be welcomed or onboarded?
I will see if I can bring this blog to the attention of the Onboarding Coach for further commentary.
September 18, 2009 at 8:23 am |
On boarding sounds like a painful process to me. I agree that welcoming is always best.
September 18, 2009 at 8:49 am |
Even if onboarding didn’t sound eerily like waterboarding, it would still be a de-humanizing word. Basically, it’s flipping around a concept to try to control the issue, similar to the word incentivize. But I suppose exert control is what businesses do.
September 18, 2009 at 8:56 am |
Perhaps there is a better word for an “onboarding” program, but I think it is naive to think that a CU shouldn’t have some kind of welcome program in place or to assume that the Member is simply going to just come to you if they need something. While of course service to our Members is top priority, we still have a business to run here! As a Marketer, it is my job to let folks know ALL of the available products and services that are available to them. I would love to assume that our front line is making sure to offer every product that is pertinent to a new Member; however, in this busy “get it now” culture, people don’t have the time to sit down and chat with us anymore. With our “onboarding” program, we are able to send out some very general information about our products that may have slipped through the cracks during an initial meeting. Not to mention that we have more than enough people who are now signing up for their Membership online and have virtually NO conversations with any of our staff up front.
This article from MAC (Marketing Association of Credit Unions) “The 3 Primary Benefits of Onboarding Outreach to New Members” describes the benefits of having such a program and why a CU should have one. http://www.macnetwork.org/0709benefitsofonboarding.cfm
Sorry for a long-winded comment but the “onboarding” program here at my CU is a project that is near and dear to my heart. I have worked extremely hard on perfecting it over the past couple years and it has always received a very positive response from our Membership. We are kind of old school here- our board and management have not yet bought into World 2.0 (despite my ongoing efforts to persuade them on the awesomeness that is Social Media) so efforts such as “onboarding” are absolutely necessary in retaining and building loyalty with our new Members.
If anyone has a suggestion of what else we can call it, I’m all ears!
September 18, 2009 at 9:34 am |
Hi Joanne!
Please don’t apologize for the length of your excellent comment. All thoughtful responses are very much appreciated, so thank you!
I have no issue with welcoming members in the least. I completely agree that members should be whole-heartedly welcomed! I applaud you for working hard on your CU’s welcoming process!
My only quibble is with the terminology being used. I would ask you, could not your entire onboarding process be better termed a welcoming process? Could you not substitute the word welcoming wherever onboarding now appears, and if you did, would that not set a better tone for the new member and the employee(s) doing the welcoming?
Thank you for the link to the MAC article. I’ve taken the word “onboarding” and replaced it with “welcoming process.” Click the link to see what that feels like.
Also, onboarding as it currently is used, is medium-agnostic. It doesn’t matter if you are talking about meeting with members face-to-face, via phone, email, web, social media, printed materials, or whatever. It’s all part of “onboarding” or “welcoming.” The terminology applies no matter the media. You can welcome a new member in person, then send follow-up welcoming messages via email, social media, USPS, UPS, FedEx, pony express, phone call, smoke signals, carrier pigeon, or mail a welcome package. Or you can do all those things and call it onboarding.
September 18, 2009 at 11:04 am |
Comment from allandddg via twitter: “I as a customer would never like to be onboarded. I think the welcoming aspect is better. As a customer I would be gone.”
September 18, 2009 at 11:40 am |
I don’t like the term “colonoscopy” but if my doctor says that’s what I need…then that’s what I get.
My point is that quibbling over the label may be fun, but ultimately misses what I would argue is the more important question: Namely, what should the objective of the process be?
For many financial institutions, the objective of the onboarding — or welcoming — process is to cross sell more products in the first 90 days of the relationship. This has been borne out of the belief that this is the window of opportunity, because cross-sell effectiveness declines after that point.
But nobody stops to ask “why does x-sell effectiveness decline after 90 (or 180) days? Maybe it’s because the customer’s expectations haven’t been met, they’ve encountered poor service, higher than expected fees, etc.
Cross-selling in the 90-day window may find some short-term success, but long-term I think it adds to the attrition problem, not helps it.
(BTW, credit unions fall into this same mentality. I’ll show you a post on a CU blog to prove that).
When I give presentations, I argue that the objective of the onboarding — or welcoming — process should be “building trust and engagement”. This 90 day period is the opportunity for the bank or credit union to CONFIRM the customer’s expectations, and make them feel like they made a smart choice of financial providers.
FIs should also be using this window of opportunity to get new customers engaged with the FI, i.e., using the Web site, downloading iPhone apps, attending webinars, enrolling in bill pay or PFM, etc.
Active, satisfied engagement will lead to long term cross-sell success much more effectively that pushing more product in the 90 day window. REGARDLESS of what you call the process of what you do in those 90 days.
Sorry for the long comment.
September 18, 2009 at 11:52 am |
Ron, absolutely no apologies necessary; thank you for your as-always-excellent response!
I agree that the objective needs to be examined, and always love that you are looking for the deeper “why” than the surface, in order to achieve long-lasting success.
My point is simply that it appears that part and parcel of onboarding is the idea that one should shove as many products and services in the face of the new customer/member in the first 90-days as possible. When you think about things in terms of welcoming, rather than onboarding, you are going to do things that achieve the “confirmation” objective much more naturally and easily. Calling it onboarding aids in the “shove product down throat” mentality and calling it welcoming aids listening, confirmation, and should result in deeper satisfaction – it keeps the real objective in the mind of management and employees much better.
P.S. There is nothing inherently wrong with the term colonoscopy; it’s only the associations it conjures that make one cringe at hearing it.
September 18, 2009 at 11:58 am |
I will say one more point in favor of the term onboarding:
If management won’t get on board with a welcoming process because it doesn’t sound like something that the organization ought to be doing, but onboarding sounds so cool and ROI-generating that they can get behind *that*, then by all means institute onboarding if there is no adequate welcoming program in place.
September 18, 2009 at 12:52 pm |
I’m with you Morriss. “Onboarding” just sounds like a term thought up in some secret executive committee meeting. New term means brand new idea. It’s kinda like “boneless wings”. No matter what you call it, it’s still chicken tenders cut in half and covered in wing sauce.
But whatever you call it, adapting your welcoming process to current customer behaviors is the important part.
September 18, 2009 at 3:46 pm |
In 2002, when we started our business accelerating leadership transitions we could not use the word “onboarding”. If you Googled it you got articles on kennels and boarding schools. Last week Wiley published our new book “Onboarding – How to Get Your New Employees Up to Speed in Half the Time”, helping hiring managers integrate talent acquisition, accommodation, assimilation and acceleration.
On the one hand, I certainly agree with the comments about “onboarding” sounding a lot like consultant-speak. On the other hand, it has become a part of the talent management vocabulary. Whatever we call it, doing it well can make a huge impact on new employees.
George Bradt – PrimeGenesis Executive Onboarding and Transition Acceleration
September 20, 2009 at 7:10 pm |
Hi Morriss, in response to your Tweet…no offence taken to your new least favourite word. It’s quite commonplace to see comments on Twitter from people who are new to the term who get a hoot out of comparing it to “waterboarding”.
However; I echo George’s comments. In the Human Resources sense, the term “onboarding” has been used for many years to refer to the process of both welcoming new hires and helping them to ramp-up in their new roles, get familiar with their new corporate culture and get engaged through new relationships and excitement about the work itself.
I began specializing in this niche in 2004 and while the term was relatively new in some business circles at the time, human resources practitioners, HR text books and articles were actively using the term to refer to the process of welcoming people on-board. Over the past 5 years, businesses have become much more familiar with the term in reference to new employees. There are numerous well-respected articles (HBR and the like) that use the term.
Using the term “onboarding” to refer to Customer onboarding in the financial services sense as you have described, or to refer to onboarding new users of software applications in the technology sense are more recent applications of the term.
For those of you who are involved in employee onboarding, I welcome you to join the LinkedIn group I lead called, Onboarding Best Practices. There are over 430 members and there has never been any dialogue in the group about the inappropriateness of the term. Debating the use of the term would frankly be an “old news” discussion in an HR context. (George Bradt also leads a LinkedIn group called Onboarding- Accelerating New Employee Transitions with over 600 members)
September 21, 2009 at 12:06 am |
Onboarding, welcoming, customer engagement, matrix mail, what ever you want to call it, it is a popular concept in banking. I am not sure when it began, but in 2004 Dove Consulting (now Hitachi Consulting) made a splash with their research paper titled “Onboarding New Customers Capitalizing On the Opportunity.”
Oracle and BAI in February 2005 gave us “The Front Line Factor – Develop Long-Term Customer Relationships in 3 Months”, a follow up study that further explores onboarding.
I agree with Ron Shevlin, it is all about engaging your customers and earning their trust.
Morriss makes some good points, I particularly liked his comment regarding a new customer, “A new customer is trying out the bank/CU”
Joanne, the CU Marketer, mentions that they like their onboarding program as it helps in the sales process as it works in conjunction with the front line staff.
Getting back to Mr. Shevlin’s comments:
1)Why are FI’s trying to sell all these products in 90 days.
2)Why does nobody stop to ask why does cross sell effectiveness decline after 90 or 180 days.
Both are interesting questions. In my past, I analyzed sales in other industries where a customer buys stuff again and again and again. In banking, only a small number of products are available for purchase. Continued sales is tough and having a multi year relationship of sales is impossible. All bankers have to sell is a single handful of products and then keep their customers happy and engaged enough to keep on using those products repetitively. To make matters worse, product differentiation is minimal between the 8,000+ banks and CU’s out there.
If banker’s start new customer relationships with a focus on serving the customer’s needs via a consultative sales process that focuses on building trust and a customer’s happiness, the sales will come in 90 days, 180 days, or 5 years down the road. Building trust and happiness with your engaged customers is your sales pipeline. You can not force a checking, savings, money market, CD, Debit card, credit card, mortgage, home equity, over draft protection, internet banking, mobile banking, bill pay, and e-statement accounts and/or services on your customers. However, if you keep an honest and open dialog with your customers and they trust you and engage with you, there is no reason why you can not have them own all these products and services from you.
So where do we begin? I do not need to tell you, Ron already did.
One last link. The links I previously provided were consumer focused. So here is a link in regards to Small Business onboarding from the March 2008 US Banker magazine: US Banker
My final word. Do not forget about your existing customers. Just because some research paper says you can not successfully cross-sell after 90 or 180 days does not mean you should not ignore these customers. Test and find out what customer segments will respond. Remember this very old direct marketing rule of thumb, recency is a predictor to new sales. In banking, a recent sale is not much different then successfully using your existing products and services. So test, test, test, learn and repeat.
@dmgerbino
September 21, 2009 at 3:08 pm |
Morriss – somehow I sensed this discussion might be coming back around. I think everyone that has commented has agreed that no matter what the “program” (if we should even call it that) is called, the key to success is to engage your new customer/member. Programs that simply throw different product offers against the wall to see what will stick are likely to chase away more new members than no engagement at all.
It is dead on that the first 90-180 days is a period of building trust – if that means instituting a formal program of follow-up contact (in any means) to build that relationship then so be it. In my opinion, the reason the opportunities are greater in this time period are because the new member/customer is generally more open to an intelligent conversation. Not a sales pitch but a conversation about products/services that can enhance their financial well-begin (bill pay, direct deposit, etc.).
If I’m opening a new relationship with a credit union and the manager says “hey, I see you have a Chase VISA – if you’re paying a rate over 10%, I think I can save you some money, would you be interested in talking about it?”, I’m willing to listen. If they don’t say something to me, but 2 weeks later I get a phone call asking if I’m gotten my debit card and then asking the same thing, I’m still likely to be willing to listen. If it’s two YEARS later, I might be wondering “where have you been for the past 2 years?”
I know, I’m rambling a bit. No matter what you want to call it, if you do NOT have some type of onboarding/welcoming going on today, you are way behind…why would you not?
September 22, 2009 at 12:55 pm |
Hmmm. So I see a lot comments agreeing that the “onboarding/welcoming” period should be one of trust and engagement building. Yet, when I hear both FIs and (especially) vendors talk about their “onboarding” success it’s nearly always in terms of cross-sell/up-sell success.
My conclusion: Engagement/trust-building is getting lip service.
September 23, 2009 at 4:15 pm |
Great conversation!
Engagement. That is the goal, right? However, many banks mistakenly measure engagement as # of products/customer. So how do they get good engagement? Cross sell! They believe they are doing exactly what people here are asking them to, and their numbers “prove” it.
Also, the reason I have seen banks trying so hard to cross sell in the first 90 days is NOT necessarily because they think the chances of cross selling are better during that initial period, but rather because they feel that if a customer buys multiple product, they are less likely to leave.
Now, of course “deeper” relationships (another great term, huh?) show lower attrition rates, so the banks believe that this aggressive cross selling onboarding period is effective.
But they are likely effective in selling to those customers that would not have left anyway, and ineffective at selling to the customers that are just “trying out” the service, looking for true engagement/trust building.
Again, sorry for the long post. I could go on and on.
September 24, 2009 at 10:53 am |
Ron – I don’t necessarily agree that it’s lip-service but I do believe that it’s worth measuring your “onboarding” efforts to find out whether it’s at all effective. That’s where the question arises – what is considered “effective”? In the absence of being able to measure trust-building, I would expect that most institutions are measuring results as cross-sales or upsales. It’s not a perfect measurement, not by any stretch, but at least there’s some measurement being done.
I suppose you could measure trust-building but that seems pretty nebulous. Maybe it could be measured by their NPS (couldn’t resist the opportunity to toss that in there for you!)
Ultimately, it comes back to the same question that every FI should be asking before they undertake any efforts whatsoever – what are we trying to accomplish?
October 2, 2009 at 5:17 pm |
Morriss, I agree that word choice is very important. Of course I would say that, as a writer. But it’s still true!
Internal jargon always makes its way into being used in front of customers so it’s all the more important to choose well. Welcoming is a great solution, as you suggest.
Onboarding sounds bad. Probably wouldn’t be so bad if it weren’t for waterboarding.
However, I understand that internal sales folks want a special word so they can lump certain goals under it, such as up-selling, which could get lost with just using a generic term like welcoming. Hmmm.
How about orientation? It seems more specific than welcoming.
July 8, 2010 at 11:49 am |
I realize that the last post is a year old, but this came up in the top 10 for a google on “onboarding”. I’m guessing that this new annoying business speak term came from “welcome aboard” to “welcome on board” to the shortened less meaningful “onboard”. This is now applied to everything from bringing on new coworkers to publishing software.
Thankfully I’ve only heard it used in finacial environments; it hasn’t spread to the larger engineering world.
For me it has no more meaning than the business speak common in 1960’s era movies where everything has the suffix “wise”, e.g. business-wise, stock-wise, etc.
August 15, 2011 at 6:52 pm |
Another year on from the last post and I here I am making a comment.
I just had to look into this because it is driving me bananas and although some would say it really is just too trivial to get carried away about – but – onboarding is not even a word!!
I have recently started working for a financial services company and have been hearing the term, and now I’m asked to complete a survey about my onboarding experience! I really want to tell them that onboarding is not even a word, and although my experience since joining the company has been fantastic, it bothers me so much that it has been accepted that a made-up word will be used to describe the process, and since we are using a made-up word, why use one that doesn’t fit or accurately convey the desired meaning?!
*big sigh* Now i have shared this rant, I’m going to try to live with it peacefully.
June 22, 2012 at 2:39 am |
All this trust and engagement discussion seems pretty dreamy. I pick a financial institution if its fees and interest rates are the best, it’s not been in the headlines for fraud, and it has enough ATMs and branches to be convenient.
The primary operative word here is convenient. This means that once I’ve gone through the pain and hassle of setting up direct deposit of my pay and all the direct payments of my bills, I am extremely unlikely to jump to another bank because I just don’t want to repeat that exercise unless I feel forced to.
At the moment, I feel locked into the bank I’ve been using, despite the annoying calls from people on the brokerage side of their house who pester me to do something else with my high balance even after I’ve reviewed their offerings, and despite the ever-changing token rings and dongles and security protocols they keep replacing but not telling me about until I’m in the middle of trying to order a wire transfer when I’m away from home. Am I feeling warm and trusting and “engaged.” Of course not. But I’m “married” to this particular bank because I have no reason to believe that jumping to another would be any better.
May 14, 2015 at 3:52 pm |
[…] I’ve always felt that the word “customer onboarding” simply doesn’t scream personalization and customer-centricity the way “welcoming” does. It’s a word that we’ve used within organisations for the longest time, and I don’t know how this got to become a customer-facing word. In this matter, we echo some of the thoughts from this blog. […]
June 6, 2015 at 11:11 pm |
I am fortunate enough never to have been ‘onboarded,’ in that I can see myself throat-punching the first illiterate fool that uttered the non-word ‘onboard’ to me, and immediately losing the job that I am just starting. (I am spurred to similar visceral fury, by the way, by hearing other such non-words as ‘efforting’ and ‘trending,’ as well as by the use of ‘so’ to begin any sentence in which its use is entirely inappropriate. Somebody call the language police, before it’s too late.)
August 10, 2015 at 7:13 pm |
let’s not forget the word physicality and musicality in the non-word mix as well. It’s really all just about the one saying it being lazy in their attempt to communicate. Saying onboarding is just plain being lazy and does not sound professional. Come on, people.
December 25, 2015 at 10:22 am |
I think “onboarding” has so many different definitions.
It can refer to your boss changing the “old” way of a process to a new way. That they are “on board” or agree to actually doing the change.
It can refer to specific steps for compliance that need to be completed for a client that did not exist a few years ago.
It can refer to developing a relationship or a raptor between an employee a client.
The relationship between a client and an employee in the Finance industry is very personal, and in my opinion should be treated that way. Gathering information and handing it over to someone a client does not “connect with” has to be an opportunity lost.
Handing that information over to someone a client can “connect with” or feel a rapport, sincerity, patience, lots of patience with paperwork and questions, is something that is special. Not every employee has that skill.
I like the word onboarding referring to internal processes, meaning everyone is on the same page with completing a task. I do not like it referring to relationship between an employee and a client. Every situation is a little different and I think it should be treated that way.