How to Plug the Knowledge Gap When Key Employees Retire

21 April 2006

John Davidson, a Partner with Facilitators UK, advises employers on how to address the knowledge gap within their organisation.

Thirty-seven years ago, Neil Armstrong became the first man to set foot on the moon, marking the zenith of a 10 year $24 billion space programme by NASA. However, in the years following this momentous occasion, NASA found it could not repeat the feat because all of the key people involved had retired and no one had recorded what they knew. To add insult to injury, the blueprints for Saturn V, the only rocket that was powerful enough to get to the moon, were lost.

A similar well-documented experience occurred at International Harvester when Russian officials approached the American company to build a new farm vehicle factory. They contacted International Harvester because it had built a plant in Russia 20 years earlier. Alas, there wasn't a single person in the organisation who knew anything about the previous project.

Closer to home, there are many examples of this kind of situation occurring in organisations throughout the UK. The public sector, oil and gas, nuclear, aerospace and transport industries all have ageing workforces, and key staff retiring in the next few years will cause a significant loss of knowledge.

Organisations that do not make a concerted effort to plug this knowledge gap will find themselves having to relearn old knowledge at a high cost. Many businesses devise plans for retaining that knowledge within their four walls, but often do not realise the full extent of the complexities they will have to deal with.

Knowledge is often captured in the form of documents and databases, but this lacks real value. Professor of Philosophy Michael Polanyi's quote, "we can know more than we can tell" shows us that this will always be the case, because the subtlety of expert knowledge is not something that can be transferred readily into written documents.

What we have forgotten is the type of knowledge described as social capital, the knowledge we have inside us about our relationships and our networks of contacts. Who is best for a particular job? Who we can call about a particular topic? Which person is most suited for a new project? How should we handle a particular kind of person? As people retire, this kind of knowledge is walking out of the door without being captured and is then lost to an organisation.

When we consider what makes us work well as an organisation, it is our relationships above all else. We may have great products, great processes or top class skills, but unless we form relationships with our customers, suppliers and colleagues we will fail. Why then are we so poor at capturing this success when our key staff leave?

Facilitators UK recommends a holistic approach to retain the knowledge of retiring staff and has developed an eight-step plan that can be implemented to plug the knowledge gap in an organisation:

  • Establish communities, so that wider relationships are formed (even between organisations) and you are not reliant on one-to-one relationships being built that, when lost, are lost forever
  • Identify key roles, so that you apply your limited knowledge management resources most effectively
  • Identify key knowledge for the role to allow you to concentrate on capturing the highest value knowledge. Most organisations focus on the easiest to capture knowledge, which is not the same thing
  • Capture knowledge in the most appropriate way. This can be in IT systems, within business processes, mentoring or more specialised ways
  • Identify key relationships, which must not be lost when staff retire
  • Recruit replacements early to avoid the key knowledge disappearing before the new person has their feet under the desk
  • Hand over relationships systematically
  • Don't be afraid to consult your retirees - they might even appreciate you keeping in contact

Unlike the NASA programme, this isn't rocket science. However, many organisations find it hard to implement, because it requires a co-ordinated approach between business functions, Human Resources and Information Technology departments. Knowledge loss is a strategic issue and it must be managed at a strategic level in an organisation by managers empowered to change way s of doing business.

Those organisations that plan for effective knowledge transfer now will find themselves at a real competitive advantage in the next decade and may even avoid having to re-invent their own particular Saturn V.

Further Information

Please contact John Davidson for further details.

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