It’s something HR deals with on a daily basis: a competent employee gets a new job elsewhere, takes parental leave, becomes ill, or retires. Company knowledge goes out the door with the employee, but operations must continue. What does this lost knowledge cost the company, and how can successful knowledge transfer be implemented?
Let’s take a look back to February of 2006. Due to corrosion in a pipeline at the Prudhoe Bay oil platform, nearly 900,000 liters of oil escaped into the ocean. The responsible company, BP, didn’t find the leak until five days later. Due to the necessary repairs, massive quantities of oil could not be delivered for days on end, resulting in fuel shortages at American gas stations. In the fall of 2006, the US Congress demanded to know what led to the incident. Once revealed, the reason was met with disbelief. A qualified employee with specialized knowledge had left the company and, due to other priorities, was not replaced. A gap in knowledge had caused millions of dollars in damages. This oil catastrophe shows that a lack of knowledge management can be very expensive.
Even small knowledge leaks slow down operations
The company Haufe Lexware surveyed human resource professionals about knowledge transfer in companies. Over one third of businesses still do not collect and share specialized knowledge, losing it as a result. In cases of high employee turnover in particular, this can cripple a business.
It’s frequently difficult for human resource professionals to know what knowledge which employees have and what that knowledge means to the company. Explicit knowledge is easy to catalog: Where is the file saved, or what is the name of the cost center? Implicit knowledge, on the other hand, can be more difficult, because it’s about experience and context. Since it includes personal relationships, the transfer of implicit knowledge is an art that businesses should master. That’s why knowledge managers within the enterprise should identify key positions. Who knows what? Which skills will the company require going forward? There are three tools that should be used to maintain knowledge within the company:
- 1. Succession planning and phased retirement for identified key positions to maintain implicit knowledge within the company
- 2. Employee engagement to minimize churn and increase employee loyalty while retaining knowledge
- A system for knowledge management to encourage employees to exchange knowledge, catalog that knowledge at a central location, and make it usable. The processes for collecting, editing, and accessing the knowledge should be simple and clear
The third item in particular has an additional advantage. The Haufe Lexware survey revealed that nearly half of the respondents are irritated when knowledge is not available or difficult to find. Another third are discouraged when knowledge that exists in the company is not communicated. That’s why 82% of respondents feel they themselves are responsible for operating a knowledge management system. The explicit knowledge can be easily archived in such a system according to a customizable structure. This saves businesses lots of time when onboarding new employees, for instance. That boosts productivity. But most of all, companies avoid high costs because knowledge transfer increases the ability to plan strategically, and costly mistakes can often be avoided.
According to Haufe Lexware, the following items should be on the agenda of human resource professionals with regard to knowledge transfer:
- Employee development (95%)
- Process efficiency (91%)
- Succession planning (88%)
- Knowledge management (82%)
- Employer branding (66%)
Knowledge loss due to demographic shift
In the reference work “Lost Knowledge” by David Delong, experts were interviewed about the meaning of knowledge transfer and knowledge management in the enterprise. In the coming years, around half of the population who have more than 25 years of experience on the job will retire. Every industry is affected. All businesses should therefore act quickly and implement the following three points: Succession planning, employee engagement, and knowledge management. This will avoid a great deal of disruption for businesses as well as unnecessary and sometimes very costly mistakes. In the end, companies save cold hard cash with professional knowledge transfer because it allows business to continue running smoothly.
SABIO’s solution for knowledge management places particular emphasis on efficiency and the availability of knowledge. It’s a solution that makes your employees as smart as possible: As a result of this simple structure, everyone likes working with SABIO. Knowledge that would otherwise be gathering dust in wikis or document management systems gains new life and becomes convenient to access. Browser-based SABIO integrates easily into your existing software and IT landscape, ensuring fast and affordable rollouts. SABIO create a central repository where the company’s entire knowledge including documents and graphics is very easy to find. With the suggestion feature, anyone can easily contribute to improving this knowledge and correcting mistakes. Editors can easily check and process content then approve it for specific target groups and communicate its availability. For everyone from field service employees to external sales staff: Traveling employees visiting customers can access information using the SABIO app on their tablets or smartphones. That allows for perfect customer service at any time or place.
No matter what size your company is, each employee’s knowledge — whether it’s stored in their head, emails, or disk drives — is cataloged with SABIO and made available to all authorized co-workers. All they have to do is catalog their knowledge on a regular basis. Costly mistakes due to gaps in knowledge that can otherwise arise from employee succession are thus minimized. Even though this increase in efficiency may not have its own line on your balance sheet, knowledge management gives you a decisive competitive advantage.
Want to avoid knowledge loss at your company? Then start thinking about preventive measures and test SABIO’s knowledge management system for free for 30 days: