The Importance of a Knowledge Sharing Culture

The costs of retraining and consultancy fees could be factored in as necessary evils of running a business, but the wider effects of knowledge hoarding can have disastrous consequences.


The importance of knowledge management within organisations used to be a thing that could be easily overlooked. However, with the Baby Boomer Brain Drain phenomenon and the millennial job-hopping trend changing the face of the workforce, the harmful effects of knowledge loss are becoming more and more evident.

In this article we’ll show you what organisations stand to lose by allowing experts to hoard knowledge and just how badly things can go wrong when this aspect is ignored. We’ll also see how the learning and development community is innovating to combat this trend and pave the way for a more collaborative culture.

First, let’s look at the catalysts that are forcing business leaders to re-examine their approach to knowledge management.


The Reality of Knowledge Loss

The Baby Boomer Brain Drain

Business leaders have recently been swept into a panic due to the Baby Boomer Brain Drain. The generation of employees born between 1946 and 1964 makes up the largest generation in US history. As they approach retirement age, the fear is that this huge portion of the workforce will take their knowledge with them when they go. It’s been estimated that this phenomenon is already resulting in 10,000 departures per day in the US alone.

Loss of employees due to retirement has always been a reality of every organisation. The fear induced by the recent spike has in fact had a positive side-effect — it has highlighted the problem of letting experts create a monopoly of knowledge and the dramatic effects that the loss of these deep smarts can have.

Gen Y and Job Hopping

At the other end of the generational spectrum, those born between the 80s and 90s have a very different approach to job loyalty. These millennials tend to hop from job to job, seeking a wide breadth of experience, rather than a job-for-life. This could be attributed to the sense of insecurity created by the 2008 financial crisis, but Tom Turner, president of , thinks it has more to do with a shift in management culture.

“In the past, employers expected employees to feel appreciative of having a job, but now employers need to feel appreciative of having their employees. Because of this, a culture of performance where everyone understands the expectations and is held accountable for performing to them is key.”

The cynic might say that there’s little point training these people if they’re just going to leave anyway, but even so, this stresses the need for a more efficient way to manage knowledge within an organisation and make it easily available from the first day an employee starts work.


The Cost of Knowledge Loss

Knowledge Hoarding slows growth

On a practical level, knowledge hoarding can impede organic growth within organisations. In a culture that doesn’t promote knowledge sharing, the knowledge hoarder reigns supreme. There could be many reasons for this: perhaps they enjoy the status of being ‘the go-to guy’, or maybe there’s simply no mechanism in place allowing them to share their expertise. You can probably cite anecdotal evidence from your own experience where a project was slowed down because the expert was on holiday.

Retraining costs

A 2014 report from industrial forecasting consultancy, Oxford Economics, estimated that it costs more that £30,000 to replace a member of staff, with the bulk of this cost resulting from the loss of productivity in the 28 weeks it takes to bring a new recruit up to speed. Since high attrition rates may become the new normal, a greater focus on knowledge sharing and mentorship within organisational culture might at least reduce this training period.

Consultancy fees

As many as 42% of companies have reported rehiring retired experts as consultants according to a 2013 survey. Rehiring retirees at a premium not only costs the business more, but it’s ultimately ineffective. Whatever stopped these experts from sharing knowledge as employees doesn’t change when they become consultants. More often than not once their consultancy period is over, they leave the same knowledge gap behind them.

Knock-on effects

The costs of retraining and consultancy fees could be factored in as necessary evils of running a business, but the wider effects of knowledge hoarding can have disastrous consequences. When BP lost its senior corrosion technician, Richard Woollam, replacing him wasn’t considered a big priority for the business. Less than a year later, a quarter-inch hole in a corroded pipeline went unnoticed for 5 days. In that time of 250,000 gallons of oil spilled into Prudhoe Bay creating an environmental incident and ultimately costing BP millions of dollars.

Corporate Amnesia — failure to learn from mistakes

Less than five years after the Prudhoe Bay incident, BP once again learned a brutal lesson about the effects of inadequate knowledge sharing. The 2010 explosion at their Deepwater Horizon oil rig not only caused loss of life and one of the biggest ecological disasters in history, but it cost the company $54 billion in federal and state claims.

Entrepreneur and writer, Margaret Heffernan, suggests that this disaster might have been avoided if a greater focus had been placed on organisational knowledge.

“What’s really horrifying,” she says, referring to an earlier explosion at their Texas City refinery, is that, “you find many of the same causes. There were exhaustive investigations as to its causes, [but] nobody did very much to encode the memory.”


How to Promote Knowledge Sharing

By now, you can see that knowledge management is critical to business success, but what can you do to turn the tide of knowledge loss in your own organisation? The key is to make knowledge available to everyone, and not to let one person be the guardian of expertise in any particular area. Here are a few more pointers to improve knowledge transfer:

Create a platform/knowledge base

The first thing you need is a platform where all of your information can be stored and accessed. Ideally, it should be open to all employees and it should give you the ability to categorise and sort documents and assets according to departments. Not only does this make it easier for employees to find the most relevant information for their roles, but it lets you maintain a hierarchy of information dependent on their level in the business.

Encourage discussion

Discussion is an essential part of a knowledge sharing culture and it achieves several aims. It lets your employees contribute their own unique perspectives, it ensures that obsolete information gets flagged up quickly and it gives those with less experience an opportunity to ask questions and look for clarification. As part of their ongoing training, this lets you harness the possibilities of informal learning, which makes up 90% of all work-based learning.

Maintain and Curate Knowledge

Creating an online discussion area also lets users vote on the content they deem the most useful. On social learning platforms, for example, the content can be weighted depending on its popularity, in much the same way as content on any other social network. This ensures that the best, most relevant information is seen by more people and it also highlights any content that, for one reason or another, is underperforming.

Grow more experts

On these social platforms, the content isn’t the only thing that can be weighted; the users of the system can also rise to prominence by interacting with fellow employees, submitting content and rating it. This gives everybody an incentive to engage with the platform more, but it also lets the administrators identify who the real experts are in any given topic. In the case of a learning platform, this is a very useful way to find people within the organisation who can contribute to the training programme.

Incorporate user-generated content into the Formal Training Programme

The effects of a knowledge sharing culture are most evident within the L&D department. Learning managers and platform administrators are under constant pressure to keep employees engaged with their training programme, and providing fresh content on a regular basis is a big factor. A platform that encourages knowledge transfer is a powerful asset, giving content creators a bank of fresh content that’s targeted specifically at their audience.

Recognise and reward contribution

“Insufficient or inefficient reward systems may lead individuals to believe they are better off hoarding rather than sharing what they know.”

So says a 2013 report in the Journal of Knowledge Management. One of the main reasons experts have been reluctant to share their expertise is that they feel undervalued. The prevailing attitude of ‘what’s in it for me?’ is unhelpful to the business, but it’s also understandable. Give these experts an incentive for sharing what they know. Modern learning management platforms, for example, incorporate gamification as a method of creating virtual rewards and some have even developed the ability to convert these virtual rewards into tangible benefits.

Make mentoring part of the promotion process

The best way to make a new initiative succeed is to embed it in your processes. If your experts need to prove that they’ve mentored another employee before they can be promoted, they’ll be much more likely to share their knowledge. This also means that their position as an expert depends not only on what they know, but how well they can teach others.

Knowledge Management is inextricably linked to training and development and a culture that encourages knowledge sharing can help training managers capture and capitalise on the informal learning that happens on a daily basis. With the right solution in place, organisations needn’t worry about the detrimental effects of knowledge loss and can instead focus on continued growth.


This article first appeared on Growth Engineering’s blog. Subscribe now to get regular news, insight and updates from the market leaders in learner engagement technologies.