In 1969, Neil Armstrong became the first man to set foot on the moon, marking the culmination of a $24 billion NASA space program. Ten years later, NASA sheepishly admitted they could not return to the moon even if they wanted to -- they couldn’t remember how.
This is a perfect example of what is referred to as the “knowledge gap”: the loss of critical information when employees leave their place of employment. In the case of NASA, all the key people involved in the original Apollo 11 project had retired…and no one thought to jot down what they knew. To make matters worse, blueprints for Saturn V, the only rocket powerful enough to travel to the moon, were lost.
Even though this NASA fumble took place 30 years ago, the exact scenario is being played out in spades as Baby Boomers (those individuals born between 1946 and 1964) are reaching retirement age. Most employers have made no effort to capture the Boomers’ knowledge before they eventually leave. In the next 20 years, 76 million Boomers will sing the Johnny Paycheck song as they walk out the door, taking with them an entire generation's worth of knowledge that can never be replaced. There is an inconvenient truth in the potential calamity, and most companies aren't ready for the aftermath.
Boomers make up more than one third of the nation's work force. They fill many of its most skilled and senior jobs. Thanks to their near-workaholic habits, they are among the most aggressive, creative and demanding workers in the market today. Economists predict their exit will cause a great, sucking hole in the workplace universe.
Companies need to bear in mind that the coming retirement years are going to be larger than at any other time in U.S. history. With 76 million Boomers leaving the workforce and only 46 million Generation Xers (those born between 1965 and 1980) available to take the newly vacant roles, there will be a deficit of 30 million workers. So while the Millennials (also known as Generation Y -- those born between 1981 and 1995) number approximately 100 million, the oldest of them are still too young and inexperienced to step into leadership roles.
A study earlier this decade by the Bureau of Labor Statistics reported that more than 17% of Boomers holding executive and managerial positions are expected to leave their careers by 2010.
While some companies have begun scrambling to hire trainees, and close the potential knowledge gap created by the Boomer exodus, most companies haven't even taken notice, according to Elizabeth Kearney, founder and president of Kearney & Associates, a nationwide alliance of experts who specialize in this trend.
In fact, according to the Institute for Corporate Productivity (i4cp), only 29% of responding organizations report that they incorporate retirement forecasts into their knowledge transfer practices. Furthermore, i4cp found that only a third add "skills gap analysis" into those forecasts; less than half say they train their managers to identify critical skills; only 23% are educated in critical skills transfer; and most companies admit they do not formally measure the effectiveness of their knowledge transfer practices.
Cornerstone OnDemand has released a whitepaper finding that most organizations, particularly larger ones, are not ready for the pending talent shortage caused by the looming retirement of Boomers. The paper, titled, "Managing Talent in the Face of Workforce Retirement," summarizes key findings of Knowledge Infusion's "2010 Talent Readiness Assessment," which indicates, among other things that:
- Organizations with more than 2,500 employees indicated that approximately one in five workers are over the age of 55;
- More than 50% of respondents said the retiring workforce will cause a knowledge/skill gap; and yet,
- Less than 30% of organizations that responded had a knowledge retention plan in place.
- Harvest critical information now and make it available at point-of-need. Companies should begin by identifying where they are most at risk from the loss of knowledge and experience. This involves, in part, establishing performance management and career development processes that identify employees with the most critical knowledge and expertise. For example, to sustain business after the 9/11 attacks, Delta Air Lines was forced to make workforce cuts to remain competitive. This meant that Delta had less than two months to identify which of the 11,000 laid-off employees had jobs for which no backups or replacements had been trained, and then capture that knowledge before it walked out the door. Supervisors worked with a team from Delta’s learning services unit to narrow the list down to those veterans whose departure would represent a critical job loss. Once these outstanding performers were identified, they were interviewed about their roles at the company. This way, Delta retained as much critical knowledge as possible on very short notice.
- Use real-time collaboration tools to enable workers to interact with colleagues. As collaboration and knowledge management have grown, relevant technologies and tools have become increasingly sophisticated. Things like workspace portals are revolutionizing knowledge management and collaboration solutions by giving workers access to enterprise data and applications, productivity and virtual collaboration tools, and documented knowledge, all of it personalized.
- Use advanced e-learning techniques. Performance simulation gives employees the opportunity to practice, in real time, the key skills and competencies they must acquire to address knowledge drain.
- Employ better workforce planning and targeted knowledge retention initiatives to address the brain drain that now threatens entire industries.
