The Business Case for Investing in Knowledge Management/Knowledge Transfer
In today’s knowledge-based economy knowledge is viewed as an organization’s best sustainable source for a competitive advantage. In the electricity sector, knowledge has tended to accumulate within an organization primarily because the workforce has been stable with employees making their career in one organization, if not the sector. A growing concern is the estimated 28.8% of the electricity sector’s workforce that is projected to retire in the next half decade. Electricity Human Resources Canada’s (EHRC) 2008 Labour Market Information (LMI) Study predicted there will be an insufficient supply of workers to fill the demand of the sector to meet the growing consumer demand for electricity. This gap exists at all levels of the industry, from engineers through technicians and trades people. This means that the sector will have to double its hiring of recent post-secondary graduates at a time when the demand for such workers is increasing in many other sectors as well.1
Today, the demographics and changing dynamics of the Canadian labour force poses a number of risks to the evolution of the electricity sector including:
- The Loss of Knowledge Unique to Organizations – legacy systems, innovations in transmission and distribution, trouble shooting, etc. – the loss of which could have significant implications for business competitiveness, productivity, and the overall health and safety in the harnessing and distribution of electricity.
- Ramping up New Employees: The demographics dictate that new employees will need to be ramped up much faster than in the past in order to replace retiring employees (most likely career employees) who have accumulated years of experience and knowledge.2
- New Skill Requirements: The need to develop new skills in order to deal with emerging technologies such as those related to smart grids and new electricity industries such as wind and solar.
- Facing the Workforce of the Future: A new generation of workers who no longer plan to have a career in one industry, let alone the same sector. They are more highly mobile and change jobs frequently, taking their technological savvy and any knowledge they have gained with them.
The productivity level of the workforce is the electricity sector’s key competitive driver. Losing many experienced, specialized, technical people and hiring new, knowledgeable but inexperienced, workers may have a detrimental impact on productivity, regulatory compliance and safety levels.
Companies within the sector will need to focus and invest in knowledge management (KM) and knowledge transfer (KT) in order to effectively harness their knowledge and business intelligence and transfer this knowledge to current and new employees.
The Value Proposition from Investing in KM/KT
In the context of the new economy, future leaders are likely to face not simply a labour shortage, but a knowledge shortage, as organizations bleed technical, scientific, and managerial know-how at unprecedented rates.3 One cannot underestimate the value of investing in KM/KT. Often KM/KT is focused on transferring knowledge from employees who are leaving and/or ensuring current employees are adequately prepared to assume new positions within an organization and/or know where to get the required information/direction they need to perform their job. KM/KT also supports organizations in tapping into and more effectively using existing information and data and creating new knowledge through standardized searchable databases, increased sharing, and collaboration. What is clear is that the benefits from investing in KM/KT are often cumulative including:
- The greater the formal and informal networking, the greater information and knowledge acquisition.
- The greater the knowledge acquisition, the greater the organizational innovation and efficiency.
- The greater the amount of innovation, the greater the market and financial performance.
Without effective and well-proven KM/KT strategies and processes in place, corporate memory is at risk of being lost which has grave business and sector-wide implications.
Electricity Sector-Based KM/KT Toolkit
EHRC recognizes the need for organizations within the sector to more effectively harness and use its critical knowledge to improve operating efficiencies, identify future business opportunities and improve overall decision-making.
EHRC, supported by a Sector-based Steering Committee, has developed the KM/KT Toolkit to provide support to organizations wishing to introduce and/or advance their approach to KM/KT. Approaches to KM/KT are as varied as each organization that employs them, and the problems that they face. Therefore, it is important that organizations have access to a number of tools and approaches as well as the experience of others, which can be adapted to their unique organizational culture, workforce risks and business strategy.
Recommendations to Employers, union organizations and interested stakeholders
The KM/KT Toolkit highlights the research findings and best practices used within the electricity sector and provides organizations with tools and resources for implementing KM and KT practices and programs. Based on its review of KM/ KT and the current practices and needs within the electricity industry, the KM Steering Committee recommends the following:
- Make knowledge management a business priority-set goals, plans and targets.
- Use KM to drive a learning culture, encouraging knowledge sharing and support decision-making.
- Embed KM and KT in your corporate strategies and business processes (e.g., corporate risk assessments and asset management strategies).
- Identify critical knowledge and create plans and structures to transfer this information - create a detailed road map.
- Engage senior leaders by creating an awareness and understanding of the organizations key knowledge risk and challenges.
- Identify a champion for the KM/KT project/initiative and link this project/ initiative to business objectives.
- Undertake regular KM and workforce assessments.
- Integrate KM/KT into human resources management plans and processes (e.g. recruitment, training and development, performance programs and succession planning).
- Review all HR policies and programs to ensure they support effective KM/KT.
- Generate KM/KT quick wins by piloting programs and working with program champions - review pilot programs and realign structures and systems.
- Develop benchmarks and measurement tools to show the value of KM/KT practices and programs to the organization - measure program progress and communicate.
- Empower, inform and enable management, employees and unions to work together to manage knowledge and collaborate for the benefit of the organization and industry.
- Encourage individuals to get involved in professional KM/KT networks both in Canada and internationally to leverage best practices.
- Industry, labour and education should come together to identify the knowledge and skills needed within the industry and work together to create and support accelerated learning options for both current and new employees.
To ensure the success of the KM/ KT Toolkit, it is important to obtain feedback from stakeholders within the industry to determine if the tools are both practical and appropriate. Further, the area of KM and KT is continuing to evolve and this valuable toolkit needs to be maintained and updated.
The KM/ KT Toolkit is intended to be an interactive portal whereby companies can both access and contribute information, tools and resources. The goal is to create a KM/ KT network with stakeholders throughout the sector and leverage best practices. In order to promote and sustain the use of the KM/ KT Toolkit and portal, the following next steps are recommended:
Engage the Sector
- Develop a KM/KT community of interest and promote collaboration in the sector.
- Through the portal, encourage the development of Wikis, blogs, provide resources and best practices, ‘ask-an –expert’, discussion groups, etc.
- Coordinate face-to-face events, webinars, or workshops at sector-based conferences to build and sustain a community of interest.
- Promote ways to encourage collaboration in the sector between employers, government, academics (to inform educational programs), and other key stakeholders such as unions and think tanks.
Maintain a Portal to Support the KM/KT Toolkit
- EHRC will maintain the KM/KT portal, developed as part of this project, on its website. The portal is intended to be accessed by electricity sector firms and interested stakeholders for KM/ KT information, tools and resources.
- Use the Portal as a ‘hub’ where new resources and tools can be submitted, reviewed and posted on the website.
- EHRC and its sector stakeholders will be responsible for attaining appropriate funding and resources to maintain the KM/KT Portal over time.
- Develop an annual evaluation plan to monitor the use and obtain feedback from stakeholders on the benefits and practicality of the Toolkit, and the network that is developed
- Evaluation plans could include: 1) web survey of users as they exit the portal, 2) web tracking of those who have visited the Toolkit and downloaded tools and resources and 3) a survey or discussion board for users to provide feedback on the tools.
1 - Electricity Human Resources Canada Powering Up the Future: 2008 Labour Market Information Study - Full Report. http://electricityhr.calmi/etc/en/docs/LMI%20REPORT%20ENGLISH%20FINAL%20LONG%20Nov%2024.pdf
2 - Greenes, K. & Piktialis, D. (2008a) Bridging the Gaps: How to Transfer Knowledge in Today's Multigenerational Workplace
3 - Delong, D (2004) Lost Knowledge: Confronting the Threat of an Aging Workforce