Employee turnover rates are set to reach over 40% in 2023, an increase of almost 10% since 2019. The result? The loss of business-critical yet undocumented institutional tacit knowledge. In Part 3 of our Enterprise L&D series, experts Michael Hendrix and Eileen Ramirez outline three techniques to overcome this challenge.  

Tacit knowledge – the skills, ideas, and experiences a person holds – is incredibly difficult for companies to capture and disseminate across the workforce. However, its capture is critical as its loss is impacting the bottom line.

The challenge is that it’s hard to measure exactly how losing tacit knowledge impacts the organization. How does it affect key accounts? How much does it delay large capital projects? To what extent is poor decision making due to lack of experience? Are regulatory or compliance measures missed due to poor awareness?

Since these numbers don’t exist on the balance sheet, it can be hard to immediately notice the effect of business-critical knowledge loss when a subject matter expert leaves or retires.

In today’s dynamic work environment, capturing tacit knowledge is now more important than ever, and the business implications are significant. But what can companies do to overcome this challenge and conduct knowledge transfer effectively?

Addressing knowledge attrition is now more important than ever

Knowledge attrition has always been a problem for companies, but it’s particularly significant now due to the accelerated rate of changes impacting organizations, including the following:


Ageing workforce

The largest generation in history – Baby Boomers – is now reaching retirement. As they leave the workforce, they take with them vast amounts of knowledge and expertise.

On average, this generation has spent over 10 years at their companies, enabling them to accumulate a wealth of company-specific and experience-based knowledge. Much of this know-how isn’t typically captured in job handover documentation and is lost upon retirement.

Increased job mobility

As the older generation retires, younger generations tend to shorten their tenure at any one company. Employees are more frequently changing jobs. In fact, tenure is starting to fall within the range of five years for older Gen X, and three years for Millennials and Gen Z. This means that they haven’t had the time to gain or develop deep expertise or institutional knowledge.

This trend has resulted in an all-time high knowledge loss and information leakage.

Technological advancements

Technology is evolving rapidly – as a result, companies must constantly adapt to stay competitive. When employees leave, they take with them the knowledge of how to use the technology and how to integrate it into the company’s operations.

Without this expertise, companies may struggle to keep up with technological advancements.

The business implications to tacit knowledge loss are considerable

While knowledge is an intangible asset, companies are assessing its cost in various ways. One way is to calculate the total cost of hiring an external employee. These costs include training and recruitment, as well as the loss of productivity that occurs during onboarding.

Research indicates that approximately 42% of an employees’ skills and expertise aren’t documented or known by anyone other than themselves. This means that new hires will have to learn almost half of the skills required to do the job well, on their own. Over time, this results in reduced productivity and, ultimately, impacts the bottom line.

Another cost to account for is the loss of productivity of related team members. If the person leaving is a leader, the productivity of the entire team will drop.

Other implications of inadequate knowledge capture and transfer techniques can include:

  • Potential business continuity disruptions or safety hazards
  • Mounting pressure on remaining employees to recover and fill gaps which can trigger decrease in job satisfaction and exasperate the attrition problem
  • Widening knowledge gaps that can impact customer service and lead to brand deterioration

Companies with complex and thoughtful employee exit strategies are continuing to come up short in mitigating this knowledge drain.

How to transfer knowledge successfully

Not only is tacit knowledge difficult to capture, but the lack of formal processes is greatly hampering efforts to do so.

Companies currently execute knowledge transfer in an ad-hoc basis, without proper planning or structured processes in place, and no plan for what to do with the data captured.

Often, attempts for proper knowledge transfer happen at the business unit level, and the information isn’t leveraged across the organization. While the intentions are good, the execution varies widely in quality. Without a structured approach, spearheaded by the learning and development organization, any data captured often remains siloed in a disorganized fashion.

Ideally, data captured through knowledge transfer exercises would be housed in a mature content ecosystem, where data is organized, searchable, and mapped to job skills.

3 techniques to capture tacit knowledge

The solution is a structured approach consisting of three techniques, each designed to capture at-risk expert knowledge:

  1. Active Knowledge Share: A conversational meeting with a group of people on a specific topic or case of mutual interest
  2. Expert Interview: A one-on-one interview focused on capturing an expert’s knowledge
  3. Knowledge Transfer Academy: A series of sessions scheduled over three to six months. It’s designed to extract and transfer critical business expertise from the expert to successors and others in related roles

Data accumulated from each technique can be leveraged to create future trainings and minimize the problem of knowledge attrition. The result from these techniques is twofold: Not only do participants learn from the shared wisdom, but a direct instruction project can be launched to build capacity across the organization.

Such a project feeds into the modern learning ecosystem, a topic we discuss in Part 4 of our series. The article will focus on the future vision of learning technology architecture.

To discover how our knowledge transfer portfolio can unlock value for your organization, reach out to our experts for more information.


Part 1: The importance of maturity in a learning and development strategy framework

Part 2: Enabling an agile learning organization 

Infosys Consulting's Knowledge Transfer Portfolio

A structured approach to capture and transfer critical business knowledge, skills, and expertise across your organization.

Michael Hendrix

Michael Hendrix

Partner, Talent & Organization Practice

Michael is a +25-year veteran of IT, Consulting, and Outsourcing. His primary area of domain expertise is in organizational change, learning and knowledge management, as well as HR services. Michael prides himself on helping his clients to align people, processes, and technologies to drive individual and organizational performance.

Eileen Ramirez

Eileen Ramirez

Principal Consultant

Eileen is an experienced learning and development consultant with over 10 years’ experience working as an Instructional Coach, Facilitator, and Curriculum Designer. She has worked with Infosys for six years leading large-scale change management and L&D initiatives, focusing on delivering business value to our clients.

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