April 2, 2024

How to Keep Layoffs and Retirements From Dumbing Down Your Business

The radiators in my house have been unreliable for years, heating some rooms like a sauna and skipping others altogether. After many visits, the furnace contractor wanted to replace the system’s unusual valves. But fortuitous advice from an older hardware store employee stopped him. Our antique heating system—built by a long-defunct company—was designed to work at low pressure. As knowledge of this system faded away, well-meaning but clueless contractors had increased the pressure tenfold. When our current contractor took the pressure down to where it was meant to be, the exuberant radiators calmed and the dormant radiators sprang to life.

This lost knowledge almost cost us tens of thousands of dollars to replace the whole system. And the impact is much greater for companies. Even before the pandemic, lost knowledge cost the average large company $47 million a year. And turnover accelerates this. In high turnover companies, 70% of employees find it hard to find the information they need to do their jobs. Fast forward to the Great Resignation and the epidemic of layoffs, and the amount of tribal knowledge now walking out the door every day is staggering.

It’s not just departing employees that threaten your company. Inefficiencies in knowledge sharing result in lost time, declining productivity, poor customer service and employee dissatisfaction. And clogged knowledge flows impede the effective onboarding of new people, many of whom waste time reinventing the wheel to do their jobs.

Protecting your knowledge (and the growth it drives) starts and ends with how you treat your people. Here are three cultural imperatives to retain tribal knowledge.

Celebrate The Value Of Older Workers

Much has been written on adapting to the needs and working styles of our youngest workers. But much less on what we need to do to benefit from our oldest workers. Hint: it’s what they know.

In 2018, 1 in 4 workers was a baby boomer. And while they've begun to leave the workforce, 75 million are expected to retire by 2030 - a silver tsunami. Many have worked for 40 years or more, bringing vast and often irreplaceable expertise. But a recent Harris Poll shows that 57% of boomers have shared less than half the knowledge needed to perform their jobs with those who will take over.

Historical approaches to capturing tribal knowledge, such as shadowing older workers or observing others' work, falls far short when workers are dispersed and digital work dominates. Knowledge work is isolated, embedded in individual work flows and nearly impossible to replicate by watching. To reverse this problem, create venues and spaces for employees to share ideas and tell war stories, celebrating failures as well as successes. Prioritize and support business projects that rely on skip-level teams, especially if your hierarchy parallels generations. Bringing tenured and new colleagues together creates active collaborative learning, marrying seasoned perspectives with fresh eyes.

Invest In Relationships That Enable Knowledge Sharing

There is no better time to focus on generational diversity, to foster shared experience and a common language across the four generations in the workplace today. The obstacles are real and substantial. In this particularly polarized election year, the younger generation sees politics and global affairs through a very different lens than their older peers. Social media continues to drive a wedge between people with divergent points of view. These conflicts and challenges spill into the workplace, raising tensions and challenging your culture.

The viability of your company’s proprietary knowledge depends on a culture of trust, respect and psychological safety. Meaningful opportunities to build relationships increases both innovation and productivity. I worked with a quality supervisor in a manufacturing company who expressed this best: “Unless you can have a safe and open conversation with someone— and understand where they’re coming from—they’re never going to share that tribal knowledge you need to do your job.”

Building a sharing culture is an investment in both time and space for people to bolster their connections, navigate the workplace and enhance their ability and willingness to collaborate. Science confirms this common sense: trust among peers and across hierarchies is a non-negotiable requirement for effective knowledge sharing.

Don’t Be Seduced By The Ease Of Technology

In the 1990s, NASA shuttered the Apollo program, storing the rocket, capsule and lunar module plans on microfiche and two paper copies, each irreparably damaged within a short time. Young engineers failed to reverse engineer the processes: technology and materials had changed so much that they could no longer decipher the older science and know-how. When the agency resumed space travel in 2021, it started from scratch.

Technology has a surprisingly short shelf life. Capturing usable proprietary knowledge requires human attention: discipline, commitment and time, backed up by an accessible and effective system. But not just any system will do. Many companies rely on platforms like Slack for quick, episodic interactions. The sheer volume of communication makes it feel that you are sharing workplace knowledge, findable if needed. But Slack is fleeting and episodic, designed to transact but not to capture. Retrieving critical knowledge is all but impossible for anyone without personal memory. Without someone knowing it’s there, it’s as good as gone.

It’s dangerous to rely on ill-suited tech systems to capture critical knowledge. Even the right system can become the kitchen junk drawer if it's not monitored. Managing your valuable insights needs strategy and attention. Form a cross-functional team to understand the web of knowledge and data that operates your business. Task them with developing a logic to classify, preserve and use critical information. Empower them to engage seasoned colleagues, seed communities of practice, develop networks to facilitate sharing and build a durable knowledge repository: searchable, accessible and, ideally, redundant. Especially for the increasing number of organizations investing in proprietary AI systems to manage critical data, knowledge quality and accuracy matters. Prioritizing and investing in the human side of this work may mean the difference between building on your valuable ideas, or—like NASA—starting from scratch.

Departing and retiring employees will dumb down your business if you don’t capture their knowledge as they walk out your door. In most cases, you may not even know what you've lost. Like my furnace contractor struggling to understand my puzzling radiators, spinning your wheels searching for or recreating valuable knowledge is wasteful, demoralizing and bad for business. Knowledge truly is power: it's time to protect what you know.

First published on Forbes.com.

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