Ensuring Business Continuity by Preserving Institutional Knowledge
In the last few years, the workforce has experienced seismic shifts. These shifts continue to shape the workforce as we know it today and will do so well into the future.
The risk management industry was not spared from these changes. A large number of risk professionals in the Baby Boomer generation retired after the onset of the COVID-19 pandemic. The rapid graying of the workforce was no surprise since, traditionally, risk management attracted people of the older generation. This was inevitable; however, no one could have foreseen a global pandemic to accelerate this phenomenon. Pew Research Center has estimated that a total of 75 million Baby Boomers will retire by 2030.
In addition to the large exodus of retirees, the pandemic and economic conditions also made the current workforce re-evaluate their work-life balance, compensation, and work dynamics. More workers are choosing to find workplaces that offer increased flexibility, better work-life balance, supportive working environments, and a greater sense of fulfillment in their roles. At the same time, many realize that leaving their current company is the only way to get salary increases that align with what they deserve and can help them counter inflation.
As seasoned risk professionals bid farewell to their current organizations, many companies are faced with formidable risks. These professionals are leaving with decades of experience and invaluable institutional knowledge. Risk management is a technical field where knowledge and expertise can only be acquired through years of experience. When resident risk professionals leave their organizations, there can sometimes be a void in knowledge. This void poses significant threats to the viability of the organization and can be an irrevocable setback. In the face of seismic shifts in the workforce, companies must enhance their efforts to preserve institutional knowledge as workers come and go.
Knowledge Continuity Risks
Many risk professionals are well adept at managing many tasks at once. They are experts at what they do. For these reasons, most risk professionals operate in knowledge silos. When these risk superstars leave their organizations, they take invaluable institutional knowledge and individual expertise with them. This level of wisdom cannot be easily captured in a checklist or report, nor can it be easily replicated in a short amount of time.
An organization’s ability to maintain its institutional knowledge over time as workers come and go is known as knowledge continuity risk. There are many risks that can arise when an organization does not have a knowledge continuity plan or knowledge management process in place.
Some of the most common risks associated with knowledge continuity are:
Having to reinvent the wheel. This is a timely and costly process as the people left behind or taking on the position will need to spend time setting up systems and procedures.
Critical information will be forever lost, which may impact how the risk management department operates.
The remaining risk management team may lack the knowledge to make quick, informed decisions.
It’ll take a lot of time for new members to get up to speed since there is not enough information readily available to quickly onboard them into the role.
In many cases, organizations struggle to get to the level of performance they once achieved. All these scenarios can be easily avoided if organizations implement a knowledge continuity plan and/or knowledge management processes to preserve knowledge from existing employees. By doing so, organizations can ensure that institutional knowledge is preserved and that future employees will have the necessary information to succeed in their roles.
How to Preserve and Transfer Knowledge
Here are some best practices for effectively preserving and transferring knowledge.
Make knowledge sharing a part of the company values
One of the best ways to preserve institutional knowledge is by making it part of the organization's fabric. Companies should make knowledge sharing a part of company values and actively encourage it. It should be ingrained in the company instead of something that needs to be done when someone is leaving. Companies can frame it in a way that will show how beneficial it’ll be for everyone’s work life if knowledge is shared with one another rather than protected.
Employers can provide clear instructions on capturing information and procedures and make recommendations on how to communicate it with other team members, departments, and stakeholders.
Create a mentorship or shadowing program
Another fantastic method is to create a mentorship or shadowing program. Companies should be strategic about who they want to pair together. Ideally, they should pair together people in similar functions, where one person has a wealth of knowledge while the other person is looking to grow their skill sets in that respective role. Mentorship and shadowing programs are an excellent way for people to learn from one another and exchange ideas, which could provide the company with a host of other benefits.
Companies can also consider job rotations and cross-training programs that will allow other people in the company to learn in-depth about different roles and functions.
Identify the core knowledge and ensure that everyone on the team understands them
Companies need to be proactive about understanding the specific tasks their employees do, along with the associated knowledge required to complete the tasks. Employers should identify the key things they want other people from that department to also know. They can build out a core knowledge curriculum that is expected for all the individuals in that department to master. Companies can host refresher sessions every once in a while to ensure that the team members have mastered the necessary knowledge. This core knowledge curriculum can also be used in onboarding new team members.
Create a knowledge continuity strategy and plan
It’s imperative that companies create and implement knowledge continuity strategies and plans. By doing so, companies can ensure that no valuable knowledge is lost when someone leaves or retires.
Knowledge continuity plans should be part of the larger business continuity plans. Here are some key components of a knowledge continuity strategy and plan:
A list of the key knowledge.
Assessment of the risks associated with losing knowledge.
Practices of how to avoid this knowledge from being lost.
And, of course, with any plans created, it’s only relevant if they are properly implemented and used.
Incorporate technology to retain knowledge
Luckily for many companies, there are now technologies available that make it easy to capture, curate, and store institutional knowledge and make it readily accessible to the people who need it. This information can be easily accessible to current and future team members.
For risk management professionals, LineSlip can assist with capturing information and processes so it can easily be transferred from one risk professional to another.
Benefits of effective preservation of institutional knowledge
Preserving knowledge is vital because it allows organizations and individuals to learn from past experiences, avoid repeating mistakes, and make informed decisions to mitigate potential risks. Here are several reasons why preserving knowledge is crucial for effective risk management:
Creates a set of best practices.
Learn from past mistakes.
Develop a more comprehensive view of their inner workings.
Enable better decision-making by having important knowledge accessible.
Build organizational resilience.
As the workforce is experiencing seismic shifts, companies need to move their focus to preserving knowledge, as it’s one of their most important tools for growth and longevity. Preserving knowledge is vital for risk management as it enables organizations and individuals to leverage past experiences, learn from mistakes, and make informed decisions to minimize risks and enhance overall resilience. Having a plan in place to preserve critical knowledge despite organizational changes will help companies create certainty in an uncertain world.