The Cost Of Corporate Amnesia

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The Cost Of Corporate Amnesia

“Those who cannot remember the past are condemned to repeat it”, George Santayana.

Knowledge and content are an organisation’s most important, yet arguably misunderstood, underutilised and underprotected resources. A huge and growing amount of organisational knowledge and content are collected and stored by organisations around the world. By the year 2020 more than 40 zettabytes of data will have been collected and stored across a wide range of systems, much of it organisational knowledge and content.

Yet despite our increasing ability to generate and capture content, our ability to use and reuse it hasn’t kept pace. Too often content collected and stored at significant expense to organisations is lost, and the benefits that could have come from using it go unrealised, because of ineffective content and knowledge management strategies and systems.

Arnold Kransdorff, who coined the term corporate amnesia in 1998, noted that in the absence of effective knowledge management, organisations were doomed to be “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”.

Unfortunately, nearly 20 years later, most organisations, even those that have invested heavily in  knowledge management or enterprise content management systems, would still identify strongly with Kransdorff’s words.

Corporate amnesia, a.k.a knowledge loss, still poses a significant challenge to organisations trying to remain competitive. Nearly 80 per cent of organisations report being affected by knowledge loss and nearly two thirds of business leaders see knowledge loss as their key concern.

The average Australian business turns over between 13-16 per cent of employees each year and the average US business slightly under 9 per cent. This figure is likely to increase with large number of Millennials entering the workforce (fewer than 1 in 5 plan to stay in their organisation long term1) and the large number of Baby Boomers retiring (more than 10,000 reach retirement age every day in the US).

Most companies understand that employee turnover results in lost productivity and added cost in the form of recruitment, replacement and training costs. How many also understand that, in the absence of effective knowledge management, staff turnover also results in the loss of that employee’s unique skills, knowledge and the ability to access the networks that employee developed across the organisation and often beyond?

Even when knowledge can be captured, there’s no guarantee that an employee, or their colleagues will be able to find, use or reuse it. Even with the new generation of knowledge management and enterprise content management systems, enterprise search engines and federated document repositories, employees still struggle to find information that’s essential to their role, resulting in lost productivity and significant opportunity cost.

Approximately 20 per cent of an employee’s work day is spent looking for information and 59 per cent of middle managers in large companies report missing important information, almost every day, because they can’t find it (Accenture via The Wall Street Journal).

At their core, issues with knowledge loss relate directly to the inability of the current generation of knowledge management and enterprise content management systems to effectively capture, formalise and manage tacit or contextual knowledge.

The Enterprise Metadata Management Application (EMMA) integrates with a wide variety of systems enabling tacit knowledge to be captured and formalised, improving efficiency effectiveness and helping to reduce knowledge loss.

EMMA enables the discovery and formalisation of knowledge networks, the previously unknown or unseen relationships between different people and pieces of information/knowledge stored across a system, or a range of systems. The formation and expansion of these knowledge networks helps to establish the context in which organisational knowledge was created and is used, providing one of the first effective ways to capture and formalise tacit knowledge.

Rather than just record and display the existence and location of organisational knowledge and resources, EMMA enables users to map, browse and (eventually) visualise he relationships between different pieces of knowledge across an organisation and beyond.

Click here to find out more about how EMMA has helped Agriculture Victoria, a division of the Victorian Department of Economic Development, Jobs, Transport and Resources reduce knowledge loss and decrease the time employees spend searching for information.

 

 

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