Do you have aging workers who are planning to retire soon? Chances are, if knowledge loss isn’t a concern for you today, it will be within a few years.
With a record number of baby boomers set to retire over the next several years, companies of all kinds would do well to incorporate the collective proprietary knowledge, innate strategies and transferrable skills of older workers into their training plans.
A study by the Corporate Learning Solutions group at the American Management Association (AMA) revealed only 14 percent of almost 1,100 senior managers and executives surveyed feel their company is “well prepared” for a sudden loss of key leaders. A startling 22 percent (more than one-in-five) say their companies are “unprepared.”1
Furthermore, most of the same people surveyed (71 percent) recognize that transitioning this knowledge in succession planning is “more important” now than in previous years. Less than 1 percent felt it is “less important.” Twenty-seven percent said the importance is about the same as in the past.
There are a couple of reasons for this. First, many companies have simply been in survival mode during the economic downturns of 2009-2010. But now, they are looking at sustainability and longer-term growth, where a competitive advantage is often tied to top talent.
Second, the need for cost-cutting has led many companies to seek out younger, less experienced workers who will demand lower salaries.
Given these circumstances, it is critically important that the knowledge of your departing workers be captured into trainable forms. It is better, and cheaper, if this can be planned before such a person retires.
Having these employees contribute to training curricula development or deliver training and train-the-trainer sessions is a good start.
According to William Rothwell, professor of learning and performance at Penn State University, “Most organizations don’t even bother to try to capture the knowledge of some of their best employees before they leave. Fewer than 40 percent make any effort at all in asking people to write down ideas for their successors.”2
Typically, such companies have no idea how much collective wisdom they have in departing employees, until those employees are gone. Thus, they have to call employees back and pay them a salary on top of their retirement package.
While many of the studies cited focus on management jobs, the U.S. Bureau of Labor Statistics has stated recently that demand for technical jobs is increasing, and the people who can fill such jobs is in short supply. So, one can make the argument that knowledge and skills transfer in technical fields will suffer from the same sort of “brain drain” as older workers retire.
Companies will soon have to start scrambling to identify their high-ranking technical people and determine the most appropriate training development and delivery strategies for preserving their knowledge.
There are a number of steps you can take now, if you still have a couple of years before the wave of retiring boomers hits your company:
- Identify what work processes and technical knowledge/skills are primarily tied up in your older workers.
- Seek out the key leaders and technical people nearing retirement who maintain these processes, skills and knowledge.
- Determine the best learning methods for delivering the above.
- Get these people involved in the learning and succession strategies you select.
Putting this off, or avoiding it entirely, can prove costly – either in additional expense to retain these employees after retirement, or in lost revenue and reduced growth due to a large loss of talent.
1 AMA study cited in Chief Learning Officer magazine, January 24, 2011.
2 Rothwell, William. Quoted in Chief Learning Officer magazine, January 26, 2011.