Knowledge hoarding isn’t the only obstacle organizations face. Knowledge loss is another common challenge organizations face today, especially as baby boomers begin to phase out of the workforce.

What happens to an organization when its most experienced and knowledgeable employees leave the company? What exactly is the organization losing?


When employees leave, they take with them the unique business knowledge and experience necessary to efficiently and effectively get the job done. While this is a serious problem for almost every company, most do not think about the challenges presented by knowledge loss until an employee has already walked out the door.

To size up the problem, let’s take a look at an example of the challenges organizations face due to knowledge loss. According to Mark Bailey, Director of Staffing and Recruiting for General Mills:

“When we calculate the cost of replacing an employee, we factor in way more than the direct recruiting costs and lost production while the job is vacant.” Bailey explained that some positions within the company, such as marketing managers, take five to six years to master. If seasoned employees leave, General Mills loses everything those individuals have learned about consumers and how to effectively market products to them. The loss of one marketing manager’s knowledge could cost the company millions of dollars.”

Furthermore, with the departure of a skilled and knowledgeable employee comes the cost correlated with the loss as well. It is estimated that the cost of replacing an employee is around 2x their annual salary. This, compounded with the loss of knowledge and productivity, leaves companies facing very steep consequences.

Here are the steps for minimizing the cost and impact of knowledge loss from departing employees:

1. Start Succession Planning (Now!)

Using the mindset that “two is one, and one is none” is a good approach for filling critical roles in your company or on your team. For any role that is vital to your business (and hopefully they all are), having more than one employee who can do the job is important. If you don’t have more than one person, begin by identifying who the next in line would be and start training them up ASAP.

2. Establish a Culture of Learning

The companies that are most resistant to knowledge loss are the ones that encourage open collaboration, curiosity, and continuous learning. For example, Starbucks’ system of corporate learning allows them to gain knowledge of new marketing or product ideas that can then be transferred to other national areas within Starbucks. Be creative when coming up with ways to build a culture of learning; host informal “brown bag” lunches once a month, where you invite one employee to share what they work on and talk about their specific approach or process. Or, have show and tell or “Ask Me Anything” sessions with company executives and management where employees can learn how they got to where they are today.

3. Document Everything

Especially for growing companies, this is a hard, but important step. By taking the time to document critical processes as they are defined and developed, you will eliminate the possibility that the knowledge will remain siloed in an individual’s head.Ultimately, start early, be proactive, and take a disciplined approach to capturing, sharing, applying, and leveraging knowledge in your organization.

4. Enlist the Help of Knowledge-Sharing Software

By incorporating the critical business information and experience employees possess into the organization’s knowledge-holding strategy. A centralized knowledge base is a key piece to a successful strategy. By documenting business processes and employee experience, knowledge is preserved within the organization as a resource for new hires. A knowledge base enables employees to access the information they need to become onboarded and successful in a shorter period of time.

5. Encourage and Reward Employees for Sharing Their Knowledge

With the right software in place, you can leverage gamification as a way to recognize and reward knowledge contributions with badges and reputation scores. At DZone Software, we have even seen some companies that provide real-world incentives to employees who achieve a certain reputation score or earn specific badges.

Despite the roadblocks that come with an employee walking out the door, an investment in a solution like AnswerHub enables organizations to combat knowledge loss and foster a culture of efficiency.