How to avoid the hidden costs of onboarding

Companies today walk a tightrope between efficiency and effectiveness in their onboarding process. When we zoom in on the top impacts of onboarding for organizations, three critical areas emerge: security, monetary costs, and experience. As workplace dynamics and security threats evolve, companies may find themselves paying a higher-than-anticipated price for onboarding. But it doesn’t have to be this way.

Security: preventing fraudsters from getting keys to the castle

Businesses need to know with certainty that the person starting the job is the one who interviewed for the job, and that they are legitimate. The consequences of hiring a fraudulent candidate can be nothing short of catastrophic.

Over the past year, a series of indictments and threat intelligence reports uncovered a sophisticated program to place North Korea-affiliated operatives into remote IT jobs around the world. In January, the U.S. Justice Department indicted five men for operating one such scheme that profited nearly $900,000. North Korean operatives, using deepfakes, laptop farms, and stolen identities to pose as U.S.-based job candidates, have been hired at numerous Fortune 500 companies, creating enormous insider risk and compliance threats while generating hundreds of millions of dollars to fund North Korea’s weapons programs.

From an IT perspective, initial credentialing (also known as credential delivery or account provisioning) is a company’s last chance to stop these and other threat actors from getting in the door. Once a new employee or contractor sets their password, they are inside the castle, and removing them becomes extremely difficult. Onboarding just one threat actor can make a company liable to sanctions violations, stolen data and secrets, a system-encrypting ransomware attack, and a badly damaged public reputation – all of which can be disastrous for the organization’s market cap.

Monetary costs: cutting corners raises security risk

The financial cost of onboarding is quantifiable: According to the Society for Human Resource Management (SHRM), the cost of hiring just one person averages $4,700. Onboarding and training alone run between $1,000 to $1,420 per employee. There is also the risk of refused access for legitimate employees. If the company can’t verify a new hire, they may have to start the hiring process all over again. While this cost cannot compare to the amount an organization stands to lose in a ransomware attack, it adds up quickly for fast-growing companies onboarding hundreds or thousands of employees and contractors per year.

Because credential delivery is such a critical, high-risk security moment, the way in which you deliver credentials is key. For companies trying to balance high security with costs, it becomes impossible for IT staff to spend their day onboarding numerous people. Instead, companies look for systems to automate the initial credentialing process.

Typically, IT departments use free or low-cost tools from their identity provider or third-party software to reduce the number of FTEs required. These tools typically boil down to sending a pre-authorized link or temporary passcode in plain text to a new employee’s personal email address or phone number. This is extremely risky, as there is no way to be sure who is on the receiving end of the text message or email link.

In-person verification is cost-prohibitive and unrealistic in today’s remote work environment. Video calls are vulnerable because any outside video stream can be fake, and video call platforms don’t tell you whether a person’s video feed is legitimate. But threat actors don’t even need to use a camera emulator; they can simply hold a fake ID in front of a camera, and the IT agent will have no way to determine if that ID is authentic so long as it resembles the person holding it.

Experience: the soft costs of onboarding

Experience is a less quantifiable aspect of employee onboarding, but just as important. Onboarding should be as simple and personal as possible for new hires. But recent research shows that 47% of companies struggle with onboarding because they don’t have the correct technological infrastructure to do so. According to Gallup, just 12% of employees strongly agree that their organization does a great job onboarding new employees.

Making people jump on video calls to interrogate them, playing the role of “deepfake detective”, is not how IT staff want to spend their time. And for new employees, it’s hard to imagine a less-welcoming first day than being sat in front of a proverbial bright light in a proverbial interrogation room.

In-person verification can be prohibitively disruptive: imagine telling a single parent or a caregiver to a sick family member that they will have to fly hundreds of miles to verify themselves in order to start work. Meanwhile, getting on a video call to show their ID can feel intrusive and dangerously like “security theater”, hurting their initial impressions of their company’s security practices.

As one senior IT leader said recently, the goal is to create a “magical experience” for employees during onboarding. Yet, too many companies are falling far short of that.

The best defense is next-generation identity security

Thankfully, new technology exists to create an employee onboarding and initial credentialing experience that is both secure and easy. The latest solutions are specifically designed to thwart the type of remote worker impersonation committed by North Koreans and other organized threat actors. These systems replace outdated, manual initial credential delivery processes with self-service backed by a high level of identity assurance.

Thanks to the latest advancements in identity verification and cryptography, companies can now achieve the level of security they require in order to enable new employees and contractors to set up their own accounts with their company’s identity provider(s). This brings a three-fold benefit to the company: First, self-service onboarding frees up IT resources, resulting in substantial cost savings; second, new employees enjoy a much more personal and faster onboarding experience; and third, today’s next-generation identity verification software is uniquely capable of detecting, surfacing, and blocking advanced threat actors like North Korea-backed operatives who are actively trying to infiltrate your networks.

Onboarding is a challenging balancing act for organizations, one that will only grow more complex as new threats emerge. With advanced, purpose-built solutions, companies can transform this process from a potential vulnerability into a streamlined, secure experience that protects against sophisticated threats while creating a positive first impression for new hires.