We all know that employers face a growing shortage of skilled staff as the Baby Boomer generation reaches retirement. So why have so few organizations taken action to ensure that they can retain and pass on the vital knowledge that these employees possess?
With more than 25 per cent of the current working U.S. population reaching retirement by 2010, a new report by online recruiter Monster suggests that a mere one in five American companies have a formal strategy in place to capture critical knowledge and experience from older employees approaching retirement and transfer this knowledge to newer employees.
To matters worse, only 12 percent of human resource managers said that knowledge retention was seen as high priority within their organizations - despite the fact that a third of them acknowledge that 20 per cent or more of their workforce will be eligible for retirement over the next few years.
"While institutional knowledge is increasingly an organization's most valuable asset, our study found many companies do not have the processes in place to preserve and redistribute this critical information," said Jesse Harriott, Monster's vice president of research.
"Bridging this gap represents a significant opportunity for companies to gain a competitive edge in a global economy where knowledge is increasingly becoming the primary resource for value."
The study suggests that while HR managers may recognize the looming issue of losing institutional knowledge due to retirement, many face barriers to establishing strategies and tactics that could help to pre-empt the problem.
One of the most significant of these is that many employers perceive conventional employee turnover as posing a bigger threat to their organizational knowledge than retirement, since younger workers leaving an organization not only take away knowledge, but also take it to competitors.
Compounding this attitude, only a third of firms said that workers are rewarded or even encouraged to share organizational knowledge with colleagues.
Even identifying what represents critical knowledge is proving to be a problem. Just a quarter of the firms surveyed reported having a formal method to actually identify the knowledge that needs to be protected and retained and more than half added that their inability to measure the ROI or effectiveness of their knowledge retention efforts was a further stumbling block to implementing a formal strategy.
"As knowledge is perceived to be a key source of internal power, employees often think that sharing what they know makes them less valuable to the organization," Jesse Harriott said.
"In reality, the opposite is true. Therefore, employers must strive to make information-sharing part of the company culture."
Concrete steps organizations can take to help mitigate the affects of brain drain include appointing a Chief Knowledge Officer responsible for organizational knowledge, implementing programs to identify knowledge assets and sources and offering knowledge-sharing incentives for employees and incorporate standards in performance reviews.
Other tactics include leveraging technology Ė using things like blogs and wikkis to enable employees to redistribute and access organizational knowledge.
"While brain drain is a looming problem for employers, it presents an excellent opportunity for innovative companies to position themselves for better competitive advantage," concluded Harriott.
"Companies that aggressively manage and protect their knowledge can readily increase their value as an organization."