Software onboarding costs can come from multiple sources, even from within your own company.
Finding the right software for your business can be a time-consuming process. You measure features against your business needs, ask for your team’s input, and finally, compare pricing against your budget. But if you are only comparing the monthly or yearly subscription fees listed on the software's website, you may be missing some of the costs that come with adopting new technology: onboarding costs.
If you're a small or midsize business leader who is ready to make a software purchase and prepare for the adoption process, onboarding costs can come as a surprise, and not all of them are fees charged by your vendor. In fact, many of them, like onboarding new resources or training personnel, may not have anything to do with the vendor.
If you're wondering about the level of effort and total costs associated with onboarding a team onto a new tool, we're here to help. In this article, we'll walk you through the costs you can expect when establishing a robust software onboarding process, as well as those you can expect if your employees' onboarding process falls short.
What are software onboarding costs?
Most business decision-makers know that modern software usually comes with ongoing costs in the form of subscription fees, but many think that onboarding is a cost that they pay once, and then they're done. However, software onboarding involves more than setup and implementation fees. It is an involved process that can set your current and future employees up for success through all stages of using the new tool.
There may be some setup fees, especially if you have to integrate the new software into your existing infrastructure, but there are also internal costs, such as the time and resources that are needed to train employees to use the software or to migrate data from legacy systems. And while setup and installation might be the last fee you expected from the vendor, what about support and maintenance? The costs of implementing new software can add up quickly unless you're prepared.
You also might have to onboard new resources, such as consultants, especially if you opt out of vendor support and don't have team members who know the software well, adding even more costs to the equation. It can seem like it never ends, but you know what could be worse? Not investing in proper onboarding. It can lead to even greater costs in the long run, such as decreased productivity and employee turnover. It's much better to understand these costs upfront and budget accordingly to ensure the success of the new tool.
What are the software onboarding costs to consider?
When buying and implementing new software, businesses need to keep a variety of onboarding costs in mind, including internal costs, costs associated with the vendor, and the cost of additional onboarding resources. Below, we'll look at each category of costs in detail so you know what to expect, what you are paying for, and why you should consider many of them as an investment in the future of your business.
Vendor associated costs
While it might seem like vendor fees pop up in the most unexpected places and never stop, you still need to consider them in the software onboarding process. Many vendors offer support to their customers during the onboarding process to help with any questions or confusion a customer may have when trying to put the tool to use in their business.
A vendor might offer technical support during software onboarding to help your employees navigate the technical features of the new tool. The vendor's support staff will help your team diagnose and resolve technical issues, show them how to put its features to use, assist with configuring it to your needs, and aid with data migration. Technical support is often offered in tiers, with packages for different sizes of businesses or differing levels of complexity. If a vendor charges for this support, be sure to include that in your onboarding costs.
A software vendor could also offer customer support which is useful for employees that will be using the software on a daily basis. Customer support reps help users with more general questions and issues related to the new software and act as your liaison with the vendor. Make sure to ask if the vendor charges for customer support packages or a dedicated support representative because your team may have a lot of questions as they begin using the new tool for their everyday tasks.
Internal costs
Software doesn't magically appear installed and working once you pay the first subscription fee. Even if it did, the skills to use the software don't transfer by osmosis. One internal cost you must consider when onboarding new software is the time spent by the salaried staff members who will be dedicated to onboarding the team that will use the tool. Make sure to include anyone who will be the onboarding champion, as well as any IT or HR staff who will help with the process.
Training is another expense to consider. The training itself may be a cost, but even if you got training as part of your package, there will still be costs involved. Each hour an employee spends in a training session is an hour your business is paying for and an hour they're not spending on their dedicated tasks, so the time spent training should be treated as another expense.
Finally, even with training, it takes a while for the team to become efficient at using new software. You will have to expect your employees to have a learning curve. Tasks may take longer initially while team members adjust to a new platform. Make sure to budget for reduced output during the lifespan of the onboarding process.
Cost of additional onboarding resources
Along with internal and vendor costs, there are some additional onboarding costs you need to consider. Something you should think about, especially if the software you're adopting is vital to operations or will be used by a large part of your staff, is investing in a learning management system (LMS). An LMS will administer and track employee onboarding training sessions and ensure that all employees learn what they need to know to use the new tool.
Another tool to look into that could help with the software onboarding process is a digital adoption platform (DAP). DAPs are designed to help users better understand and use applications and reduce their learning curve. They provide interactive guidance and contextual tips that walk new users through the functions of the software in real time.
If your software purchase will move you from a hardware-based infrastructure to the cloud, it might be worth working with a cloud consultant company to ensure successful implementation and maintenance of the tool. A cloud consultant can provide guidance on everything from selecting the right cloud service provider to setting up and configuring the necessary infrastructure. By working with a consultant, you can ensure that you don't run into any costly slowdowns while your team gets familiar with the new software.
Key considerations for preparing your business for software onboarding costs
While it might seem like the answer to keeping software onboarding costs down is cutting some of them, it is important to understand that the success of the onboarding process is not just determined by the price you pay. The time and effort your employees spend preparing your business to adopt the new tool also factor in. Failing to provide adequate training and support to your team can lead to costs you never expected.
It will take time for employees to get used to the ins and outs of the new software. Without training or support, they will have to figure it out themselves or search through documentation or Google to find the answers they seek. And while they are doing this, they won't be working on their primary tasks, which can impact the quality of their work.
Other employees may not take the initiative to find the answers they need or may not know how. Instead, they'll just get frustrated with the unintuitive experience the tool provides and lack the motivation to finish their tasks or complete their tasks incorrectly. This can result in more lost time and effort.
Some employees may struggle with the software and won’t search for answers nor will they try to figure it out as they go. Instead, they will go directly to your IT team for help, reducing the time that team has to do other necessary tasks.
And finally, the frustration employees experience using the software could make them give up on it entirely and look for other ways to complete their tasks. This increases the risk of shadow IT, where employees use unsanctioned processes, which can ultimately be more expensive and less secure, not to mention the fact that you paid for the initial tool that no one is using.
It’s worth it to have a comprehensive onboarding process
While implementing an effective software onboarding process may take some time and cost your business more initially, it can keep costs down in the long run as well as empower your team, reduce mistakes, and maximize user adoption of the new tool.
On the other hand, neglecting to provide sufficient training will most likely result in hidden costs, such as employee frustration, burnout, and the risk of employees using an alternative unapproved process to get their work done. By considering the costs and benefits of onboarding, you can create a training program that will help your team succeed and maximize the value of your software investment.