The Employee Life Cycle Model: what is it and why it is important?

Ngoc Anh Luong
Ngoc Anh Luong
Head of Digital Marketing at traicie - The best AI-powered talent sourcing tool for recruiters
Table of contents

This article, traicie aims to present thorough research about what an employee life cycle (ELC) is, the stages that comprise it and the reason for building an ELC. We want to share valuable tips that will help you implement each step correctly as well as suggest the best tools to govern these stages.

It is generally known that loyal customers, visionary leaders and quality goods all influence a company’s success. But most importantly, a company’s best asset is its employees. How labourers onboard organisations and navigate the course of their careers within the company is an interesting topic to discuss.

What is an employee life cycle (ELC)?

The employee lifecycle (ELC) refers to the worker’s professional journey at an organization that usually follows a designated pattern. To put it in other words, the ELC is a model which consists of different stages an employee mostly undergoes as they work in the company.

Every cycle has a start, mid-point and an end. You enter the cycle right from the second you are aware of the company’s existence and stay in the cycle until your last working day.

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If you are an HR staff, understanding how to engage with your employees at every phase of the employee life cycle (ELC) enables you to encourage longevity and success among your company, given that people are considered the most valuable resource of an organization.

The ELC allows HR leaders to find and choose the right employees to work in the organization, helping them make progress in their career without damaging the company’s productivity. It is highly recommended that companies keep their employee satisfied and engaged during the entire process to create a streamlined work environment and reduce turnover rate.

What are the stages of the employee life cycle?

There are 6 specific phases of an employee life cycle (ELC) including Attraction, Recruitment, Onboarding, Development, Retention and Separation. These stages visualize how an employee engages with the company they work for.

Every phase of the ELC is in line with the core responsibilities of the HR manager or HR business partner.

how many stages in employee life cycle ELC
StageDefinition
AttractionCompany’s plan to attract potential candidates to work for them.
RecruitmentBring in the talent to the company
OnboardingGet the new employees settled in and up to speed with the company procedures.
RetentionKeeping employees with the company by offering bonuses and appreciation
Career DevelopmentHelping employees to get ahead in their career through a variety of initiatives.
SeparationAn employee quits his/her job and leaves the company

Traicie shares more details on each stage of the Employee Life Cycle (ELC)  in the following section.

Stage 1 in the ELC: Attraction

The first stage in the ELC is attraction. The hiring process starts with people responding to job advertisements or job referrals. To elicit these responses the company need to build plans to attract new talents. Via well-researched employer marketing a company should know how to reach out to job candidates to have them apply for its vacant positions. 

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A first step is to create goals on what they would like to be known for and how they can be a better choice than other companies. This is where brand awareness, company culture, company vision & mission and company perks come to play their part.

How to attract new talents?

The HR department needs to collaborate with the Marketing division at the attraction phase of the employee life cycle to improve brand awareness, uplift the company profile, promote corporate culture and advertise promising incentives. This is done through a strong mission statement, PR campaigns and social media posts.

An important trend in employer marketing is ‘branding your culture’. Through a variety of authentic testimonials candidates are given a clear view on the behaviors and values that make up the company culture. In this way the candidate can decide whether their is a good fit between his/her personal values and the purpose of the organization.

Objectifying company culture can be a tedious and expensive process. Discover how the traicie AI technology can help you capture your organizations culture in a matter of minutes

It is important to track how attractive your company is by checking the number of likes on social media, tracking clicks and views on the company website or through candidate surveys.

Stage 2: Recruitment

The second stage of the employee lifecycle is recruitment. This is the stage where you as an HR professional, make the first contribution to the employee life cycle by bringing in new laborers to your company, thus this stage should be prioritized. Recruitment stage is the first point of contact for the future employees toward the company. Potential employees can evaluate the work environment and learn more about the career development path with the company.

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After candidates have been interested in your company, the company needs to have a recruitment plan. They need to be sure what kind of employees they want to hire and how they are going to select them.

How to recruit the best candidates?

First, you can ask the current employees for their referrals, harnessing the power of your network to attain contacts of prospected job applicants. Current employees can possibly connect you with several skilled professionals they know that may be suitable for the position and the referral bonus given to them shall strongly encourage them to do so.

Second, you can hire new employees through the open job market and use portals like LinkedIn, Indeed, Glassdoor, just to name a few. It is important that HR experts carry out research on which channel to use best to find highly skilled and suitable candidates for your company. The Talent Acquisition Manager and recruitment team should set up a great recruiting plan, manage their job postings and clearly explain the job requirements. This will set the right expectations for incoming candidates.

Seeing the skill gap is a global issue, making it extremely difficult to find qualified candidates for a large number of roles, it is recommended critically think about the necessary job requirements. Potentially the HR team, together with the hiring manager, can ease up on hard qualifications in favor of required attitude, thus widening the net for more valuable candidates to apply.

Learn how traicie can help you define the exact set of behavioral skills you are looking for in a specific role, thus objectifying the attitude a candidate needs.

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It is also necessary to ask for feedbacks on the recruitment process. The feedback can help you improve the hiring process and can be gathered through surveys or questionnaire designed for candidates.  

Several metrics to measure the effectiveness of recruitment stage can be the number of applications submitted, interviews done, offers given, and job offers accepted.

Stage 3 in Employees Life Cycle: Onboarding

After the candidate accepted the job offer and the recruitment process is finished, it is essential that the HR departement organizes a smooth onboarding process for new employees, knowing that starting a new job can be both exciting and stressful.

New employees should be given all the necessary information regarding their first working day, the schedule of their first week, what kind of training there will be, the requirements of their role and what documents they should submit. It is surprisingly reported that around 60% of all employees decide whether to work a long time at a company right after their first day!

In the best of cases HR makes new employees feel welcomed, secured and supported. It is suggested that HR be accessible to answer possible questions and resolve doubts for new employees. Plus, all job description, the corporate culture and the job requirements should be repeated to new hires during the first onboarding days.

It is also nice if the new hire’s desk and devices like desktop and phone are available for the employees from the beginning of their onboarding week so that the new employees can get straight to work. Furthermore, after getting new talents on board, it is crucial for HR to keep watching over an employee after they have begun working to make sure they are gaining positive experiences.

How to create smooth onboarding experience for new employees?

  • Provide a great deal of information
  • Schedule on boarding week
  • Communicate clearly and be open to questions
  • Put working equipment in place
  • Survey to get feedback

Stage 4: Development

A great number of job seekers consider career development as one of the most important targets they set for their jobs. Employees want to be challenged and given opportunities to thrive in their careers. A company should let employees know how they can be more skillful in their job and get promoted to a higher position in the future. Nowadays, millennial workers would be interested in companies that actively invest in the labor force, rather than the companies who do not.

How to further develop the career of employees?

  • Offer professional development program
  • Support continuous learning, participation in seminars and conferences
  • Provide opportunities for an employee to climb up the career ladder.
  • Offer free mentorship and training courses
  • Design interesting relevant projects and assignments for employees to complete and then grade their work to give them the feel of achievement

Find out how traicie can help you identify skills gaps and personal growth opportunities for employees throughout their careers

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Stage 5: Retention

As soon as the employees have settled in, they start the inner debate whether to work long-term in the organization. This is a make-or-break moment for the HR department. The retention stage is all about keeping your employees happy in the company. If four precedent stages including job attracting, recruiting, onboarding, and talent development are well performed, there are higher chance that employees stay with the company.

At the retention stage, companies should show their appreciation toward the current employee by making the employees feel valued and respected. 

Most HR professionals utilize the HR talent management tools which formulate certain metrics to indicate promotion chances of the candidate and the data can be taken from the HRIS system.

During the retention phase, it is crucial to learn about what prevents staff from resigning. Everyone shall not be the same in this matter, therefore, the organization should be actively listen from workers about what they find important.

How to keep employees to stay with the organization?

  • Offer monetary incentives: bonuses, pay raise, awards, prizes
  • Grant certificate of achievements, offer advanced trainings
  • Survey team morale
  • Create a HR business partner role that monitors employees engagement

Surveys, anonymous polls and interviews with the employees and leaders give HR an idea of whether the organization is doing well to retain employees and what you need to continue doing to reduce the chance of people leaving the company.

Stage 6: Separation

The final stage of the employee lifecycle is separation. It can be said that almost all employees shall quit their jobs some time in their life. Those between the ages of 18-29 resigned more than any other demographic, with 37% quitting their jobs in 2021.

 Although HR may have tried their best to keep the employees stay with the company, employees make their decisions quit their jobs. Understanding the reason behind their decision to resign is crucial.

A bar chart showing the top reasons why U.S. workers left a job in 2021: Low pay, no advancement opportunities

Source: Majority of workers who quit a job in 2021 cite low pay, no opportunities for advancement, feeling disrespected by Kim Parker And Juliana Menasce Horowitz, published on MARCH 9, 2022

According to a survey carried out by Pew research center, majorities of employees who left their companies in 2021 say low pay (63%), no opportunities for advancement (63%) and feeling disrespected at work (57%) were reasons why they quit.

As an HR expert, you should try to figure out why employees want to stop working at your company to prevent future lay-off and follow proper procedures and paperwork in the offboarding stage.

How to go through separation stage?

Identify the reason for their resignation to prevent future employee turnover

Remain a good relationship with the employees who leave for future cooperation and protect the brand image

Nourish team morale  to keep the current employees stay with your company

Why is it essential for companies to engage in the Employee Life Cycle?

The Employee Life Cycle is essential for a couple of reasons.

  • Creating great connection with the employees at each stage

When a company well applies the Employment Life Cycle model and works up to it, employees will feel being engaged strongly to the company at each phase of their career and they are pretty happy working there. This results in raising work productivity with an engaged labor force.

  • Maximizing employee satisfaction

Getting a good understanding of the ELC assists companies to pay more attention to improve employee engagement and employee experience. Additionally, reviewing and planning around life cycle stages can help organizations gain more employee satisfaction, which benefits the enterprises in getting more productive employees and winning customer loyalty

  • Minimize staff turnover risk and reduce costs

The better the experience an employee has got with your company, the more likely they are to remain working for you. This results in minimizing the staff turnover rate and saving various costs for recruiting new talents to substitute the ones who leave.

  • Tools for managing better each stage in the employee life cycle

Human Resource Management software HRIS is a powerful tool to help HR team mange each stage in the employee life cycle.

Key players in this market shall include Oracle, Zenefits, SAP SuccessFactors, BambooHR, DayForce by Ceridian, Namely, SyncHR, APS Payroll&HR and Netchex

Significant trends rising in recent years in the management tool of ELC is to use 360-degree feedback and the application of artificial intelligence (AI) into HR technologies.

With 360-degree feedback, an employee’s peers, leaders can offer anonymous online feedback. Such feedback mechanisms have been more and more widely used, providing open and trusted feedback. T

Additionally, AI technology has been integrated into different stages of the employee life cycle. It first became popular for use empowering talent acquisition because it helps recruiters more quickly examines the candidates’ skills and attitude, educational background and match them to the job requirements to reduce bias in the initial screening process and save recruiters time and costs. Little by little, AI has been applied more regularly into other stages in the ELC such as employee engagement and retention.

Steps to design an Employee Lifecycle Strategy

After diving into the six stages of the employee life cycle (ELC)and knowing how important to incorporate the ELC into the company, HR division should work together to come up with a strategy for how they want designing the entire employee lifecycle coherently.

Step 1: Define the target

The first step of forming an employee lifecycle (ELC) is drafting what an HR manager wants to achieve in each stage of the employee lifecycle. What do you wish the new talents to experience in each stage of their lifecycle with your company? How straightforward do you expect each stage of the ELC to be?

Step 2: Clarify each stage

The next step is to get a clear vision of each stage in the employee life cycle. What each stage looks like and means will be different for each company. What should an employee get out of each stage of the employee lifecycle?

Step 3: Teamwork with Other Departments

After setting goals and portraying each lifecycle, the HR department needs to make sure other departments also support and work in line with them to execute each stage in the cycle smoothly.

Step 4: Review the Strategy

Reevaluating the strategy after it has been designed and applied within the company and make continuous advancements on the way. Getting constructive recommendations and feedbacks from other employees on the organization’s employee life cycle will be a great pulse to get things done correctly.

In conclusion

The employee lifecycle  model is one of the best solutions that HR department should master. The cycle begins from the pre-inception stage of getting attracted by the organization but not yet working for them, to the last stage of leaving the company. Understanding the employee life cycle and knowing how to engage with people in each stage of the cycle enables HR professionals to bring in the best matched candidates and optimize their employee experience. By having an open dialogue in every step of the way together with great teamwork, you are much more likely to attract and retain a fantastic workforce.  

Do you know that traicie candidate scanning AI tools for recruiters can support HR Management in strategic operational value in recruiting process for term of:

  1. Cost of a job board- Reduce annual spending on job boards
  2. Cost of HR’S tools – Reduce the cost of surveys and assessment tools.
  3. Recruitment costs – Reduce selection costs
  4. Internal mobility – Fill more skilled jobs with internal staff
  5. Time to hire – Reduce the number of days a role goes unfilled.
  6. Salary costs – Reduce overall salary costs
  7. Attrition – Reduce the rate of turnover
  8. Recruitment cost – Reduce the general recruitment cost

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