How Institutional Knowledge Decay Impacts an Organization’s Growth.

 

In the information age, knowledge is power. Knowledge is constantly evolving, and we are being bombarded with new knowledge every day. What was a fact few years ago is now considered outdated or irrelevant. The decay of knowledge not only affects us an individual but is also affecting the organizations. Technologies change constantly leading to decay of knowledge. Companies need to keep up with the market trends and constantly innovate to stay relevant and competitive.

Organizations generally go through a rigorous process for hiring the rights skills and experience. Also, the workforce is trained in specific skills and tools to align with their role and organization’s goals. But the fact of the matter is that employees leave and take along with them crucial knowledge and experience.  Also, people retire, taking their wealth of experience and insights which is then lost to the organization where an employee gained it all. Organizations are then left struggling to fill the skill gaps outgoing employees leave in their wake.

Failure to capture the experience of employees who leave, and past mistakes that proved disastrous and left behind a trail of lessons learnt, prove disastrous for growth of organizations.  These learnings are knowledge that needs to be captured, constantly revisited and revised, and disseminated seamlessly for growth and progression of organizations in the highly competitive market space.

According to Arnold Kransdorff, when this knowledge is left undocumented, it leaves organizations “plagued with an inability to learn from past experience, which leads to reinvented wheels, unlearned lessons, a pattern of repeated mistakes, productivity shortfalls, and a lack of continuous performance improvement.”

Knowledge decay hampers innovation. Innovation directly implies the services and service delivery which directly impacts the organization’s profitability.

Moreover, when institutional knowledge is lost because of the exit of an employee, and if the organizations fail to capture knowledge and disseminate it, it definitely puts the business in perilous position. The missing download of insights and knowledge from the outgoing member, makes joining of the new employee inefficient, affecting his productivity, efficiency, and morale which directly impacts the organization’s business goals.  

To remain informed and relevant in the market, organizations must adopt knowledge management systems for capturing the knowledge, preventing the loss of expertise as well as to constantly review and update the knowledge base.

By making collaboration, knowledge sharing and rewarding the knowledge sharing efforts, a part of your organizational culture, you can definitely prevent the decay of institutional knowledge, keep your employees armed with best tool and practices to foster innovation, and stay mile ahead of your competitors.

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