One Business Outcome of the Pandemic: Organizational Knowledge Loss
There is plenty of collateral damage to point to in the business community when it comes to the COVID-19 pandemic, from shuttered businesses, to lost jobs, to fears about workplace safety. But one casualty that tends to get less attention is the loss of intellectual capital and organizational knowledge that happens when workers are laid off, furloughed or have their hours reduced.
That probably wasn't front-of-mind when organizations went into survival mode at the beginning of the pandemic. But as they undertake the task of reviving and trying to thrive again, it is a problem that could come back to haunt many firms.
"I think it will have a more negative, long-term effect that most anything else," said JD Norman, senior manager at Deloitte. "Companies are not just losing competencies with staff cuts, they’re losing valuable, resident knowledge, experience, relationships, etc., that will take time, effort and investment to find, rebuild and/or replace."
Knowledge Retention Depends in Large Part on Culture
Just how serious a problem the loss of knowledge management is at any given organization depends primarily on culture, stresses Jennifer Mendez, director of knowledge management at law firm Fisher & Phillips in Murray Hill, NJ.
"A culture of knowledge-sharing and top-down support are critical to any knowledge retention strategy,” Mendez said. “If you build knowledge sharing and knowledge retention into the company’s culture and it is communicated to all employees upon joining, it will facilitate the process of sharing and capturing knowledge. After culture, determining how knowledge will be captured and distributed will be key to a successful knowledge retention strategy."
Assuming that an organization has the right culture to best retain important knowledge, there are many ways to incentivize team members to contribute and share knowledge to shared systems. These include experience databases and knowledge banks, Mendez explained.
“The implementation will need to be handled on a firm-wide basis and should not be siloed,” Mendez said. “Communication and training will be critical to the adoption of any systems that capture or disseminate firm knowledge. Involvement from a multi-disciplinary team of professionals that understand where the firm’s knowledge lives will also be important to the implementation of a knowledge retention strategy.”
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What We Need: An Alternative to Layoffs
One of the biggest threats to the retention of organizational knowledge retention is obviously the large number of employee layoffs or work reductions the pandemic has forced on many firms. That was especially true this spring, when many states went into lock-down mode. But the threat remains, and organizations need to take appropriate steps ahead of staff cuts.
“In preparation for job cuts, firms should focus on the retention of tacit knowledge,” Mendez explained. Giving the example of law firms, Mendez said “we have plenty of knowledge that lives in firm systems, such as case documents in document management systems, time entries, emails, etc. However, there are often pieces of information that no one has bothered to document, such as why systems were configured in a particular way, unique client preferences, etc.”
In terms of the skills that firms should prioritize for retention, Mendez said that will vary by firm, their areas of specialization and their client base.
“However, beyond those, firms will need to place importance on technical skills. Even before COVID-19, the growing digital skills gap was apparent. Firms that focus on the adoption of technology, innovation, and the like, will be well-positioned to succeed beyond the pandemic.”
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Knowledge Management and the Remote Workforce
For many organizations, knowledge retention is an especially tough problem to resolve now. Some experts advise taking the time now to reexamine business processes and job roles, and look for any possible alternatives to layoffs.
“Workforce reduction strategies are always difficult to navigate — especially when the reduction is due to something that is out of our control and the employee’s control, such as a global pandemic,” said Misty Guinn, director of benefits and wellness at Benefitfocus. “It has nothing to do with performance, and when you start to prioritize, it is important to identify the skills and knowledge needed to achieve the company’s objectives and financial key results.”
“I also feel it is critical that a company explore alternatives to a reduction in workforce if possible, by analyzing all discretionary spend, reviewing merit cycles, testing reduced schedules or even repurposing employees within the company to prevent the loss of their knowledge, experience and skill sets,” she continued.
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Organizations need to be more deliberate in their knowledge capture practices with so many employees still working from home. Communication and engagement can help compensate for the loss of face-to-face interactions and ensure employee ideas and contributions don't go lost.
“While working remotely presents a number of challenges for employers, firms that have invested in certain technologies will find it less challenging to fully benefit from the knowledge of their employees,” Mendez says. “Videoconferencing, collaboration software, such as Microsoft Teams, enterprise search, and a number of knowledge management solutions make it possible for firms to successfully capture and share knowledge within the firm.”
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Steps to Retaining Key Organizational Knowledge
Organizations can take steps to safeguard organizational knowledge in the ranks, especially with the new largely-remote workforce.
“One of the first steps would be to invest in the latest and greatest technology and equipment to support their remote employees — from upgraded computers and software, to ergonomic and network support, to stipends,” Guinn said. “A best practice to keep your finger on the pulse of your employees is regular surveys and focus groups — providing these listening posts will help you ensure you are engaging them in this new world.”
That advice is echoed by Kelly Doyle, managing director at Heller Search Associates, who believes that with smart use of the right technologies, organizations are able to benefit from the same knowledge and ideas, just storing them in different ways.
“There is always a bit lost without informal conversations in the office, but using the right tools, critical knowledge can be retained and shared,” Doyle explained.
Communication and Collaboration: The Cornerstones of Knowledge Retention
One of the most important lessons of the past few months has been the critical importance of communication, between employees, and between managers and employees. Technology has greatly aided in those efforts, but it has also created new challenges.
The pandemic has accelerated the need for employees to be comfortable with different technologies to help firms become better aligned with today’s digital world, Mendez said. But once they master those tools, “continued communication and collaboration are key to fully benefit from the knowledge, experience, and ideas that workers have,” Mendez continued. “The pandemic has forced us into our homes, but it doesn’t have to mean the end of meaningful relationships or conversations in the workplace. While technology can help support communication and collaboration, it will inevitably come down to effort and firm culture.”
Finally, loss of knowledge after an employee departs, becomes ill, takes leave, etc., is something that all companies have to contend with Mendez stressed. “Regaining that knowledge can be incredibly challenging, which is why requiring succession planning, knowledge transfers, exit interviews, and having knowledge management systems in place are incredibly important to retaining knowledge. If circumstances do not allow for some of the aforementioned knowledge retention strategies, conducting an audit of the knowledge and relationships the employee had and facilitating conversations with colleagues, clients, etc. will be crucial to attempting to recreate some of that lost knowledge.”