How corporations are scrambling to tap the expertise of baby boomers before they retire
Each night during a recent sales trip to Rio de Janeiro, Black & Veatch Senior Vice-President Michael Perry would review the day's progress over dinner with several junior staffers accompanying him. After watching Perry in action, they had plenty of questions: Why had he worked toward a compromise when the Brazilian client clearly wasn't going to budge? How was he accounting for the different cultural perspectives of the British, Japanese, and South Korean businessmen who were potential partners in the deal?
Perry and colleagues returned to Black & Veatch's Kansas City (Mo.) headquarters with strong progress to report on the $1 billion energy project. But the 59-year-old executive had done something that will probably prove even more valuable for the company in coming years, after his retirement: He instilled some of his specialized negotiating skills in his would-be successors.
Knowledge handoffs like this are becoming more common at companies, motivated by the concern that droves of retiring baby boomers will mean huge losses in irreplaceable intellectual capital. "When people leave organizations today, they are potentially taking with them knowledge that's critical to the future of the business," says David DeLong, a business consultant and author of Lost Knowledge: Confronting the Threat of an Aging Workforce. Whether it's a key client relationship, mastery of an outdated computer language, or simply knowledge about where certain files are saved on a company server, every business has stored up bits of information and knowhow that isn't written in a manual or recorded in a training video.
Many companies are rolling out initiatives aimed at capturing mission-critical knowledge before it walks out the door, and making it stick with younger generations of workers.
At the start of this year, Perry and several other senior leaders and key technical workers at Black & Veatch entered a phased-retirement program designed to reduce their workload, give them some time to reinvest their knowledge in the company, and give them some free time to begin adjusting to retired life. Some days, Perry's knowledge-transfer activities involve updating an 80-page training manual to include changes that have been made in recent years. But much of his time goes into what he calls "informal mentoring" of around 30 to 40 employees who will need to know some his more intangible skills once he's gone—like negotiating with a hard-bargaining Brazilian. "I have never been creative enough to figure out how to write that stuff down," says Perry.
Some of the inspiration for the Black & Veatch initiative came last year, when HR leaders from the company participated in a research working group on "multigenerational knowledge transfer," organized by management researcher the Conference Board. Meeting periodically over a nine-month period, representatives from Black & Veatch, American Express (AXP), Procter & Gamble (PG), and six other companies compared notes on the best ways to facilitate a knowledge handoff from one generation of workers to the next.
No Lectures, Please
One of the biggest hurdles, most agreed, was getting baby boomers to speak the language of Gen Xers and Gen Yers. According to Diane Piktialis, a Conference Board program leader and co-author of a new report, Bridging the Gaps: How to Transfer Knowledge in Today's Multigenerational Workforce, baby boomers are used to learning in a classroom environment where they are passive and "you have one instructor or expert who is in control." Younger workers, on the other hand, "want interactivity. They want things in little chunks, and they want to be in control" of how they learn.
This means that if senior leaders simply lecture their successors about their entire history at the company, the message will probably fall on deaf ears. Instead, says Piktialis, companies should encourage soon-to-be retirees to use digital tools like Wikis, blogs, and instant messaging. An "aha" moment during the research working group came when one participant, a senior manager who mentors multiple younger workers, realized that rather than setting up a formal monthly meeting with each one he should learn how to use instant messaging to check in with them on a more casual basis.
Many companies realize that they are on the verge of losing stores of knowledge but don't know where to begin efforts to retain it. "Focus on specific business needs," says Kent Greenes, co-author of the Conference Board report and an independent knowledge-management consultant who has worked with companies like Hess (HES) and Northrop Grumman (NOC). Frequently, Greenes and his team will be called in to gather expertise from about 20 experts in a company and use their responses to help the client achieve one tangible business outcome.
Gaining an Edge
Other approaches target specific business units or roles within the company. A pilot knowledge-transfer program at American Express focuses on senior employees in technology, because it's easiest to assess what skills needed to be passed on there—according to Jim Rottman, head of the company's workforce transformation group—and finance, because that's where the company has some its most important client relationships. An initiative in P&G's research and development unit targets "connectors," or senior technical workers with the most relationships and influence within the organization.
Experts agree that, over the coming years, companies that have these programs in place somewhere in their organization will gain a competitive edge. "Leveraging the collective knowhow of organizations is really going to pay for itself now, as we're approaching complex problems and going into new markets and working globally," says Greenes. "Wherever it has been difficult to do things, that's when you're going to see knowledge management come to the fore."
Click here for a slide show on 10 knowledge transfer methods that will help senior workers impart their wisdom to the younger generation.