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Combatting corporate memory loss

10 November 2021
  

Preventing corporate memory loss in your workplace will contribute enormously to your people feeling like they’re part of a team and knowing what’s expected of them. In the ‘age of the employee’ it’s the secret ingredient to company success.  

Companies grow and change over time. Employees come and go, organizations are restructured, projects are launched and completed. In the course of all these changes knowledge is gained – and lost. If knowledge isn’t tracked and available to employees then over time people lose their understanding of the company's history or how they fit into the big picture. 

What is Corporate Memory? 

The individual's capacity to acquire, retain, and recall knowledge is associated with their long-term memory. In business, corporate memory refers to the collective ability to store and retrieve knowledge and information. 

Corporate memory consists of accumulated information based on past decisions.

Corporate (or organizational) memory spans all the repositories in which a company may store knowledge. This includes the more formal records, as well as tacit knowledge embedded in people, organizational culture and processes. 

Walsh and Ungson (1991) identify 3 stages in the process of building corporate memory: 

1. Acquisition:  

Corporate memory consists of accumulated information based on past decisions. This data isn't kept in one central location, but is divided across different retention facilities. Information is periodically added to the organizational memory after each decision is made and the ramifications are considered. 

2. Retention:  

Past experiences are retained in 5 repositories: 

      • Individuals 
      • Culture: the language and frameworks that exist within an organization and form shared interpretations. 
      • Transformations: the procedures and formalized systems that the organization employs. These systems reflect the firm's past experiences and are repositories for embedded knowledge. 
      • Structures: these link the individual to other individuals and to the environment. Social interaction is conditioned by mutual expectations between individuals based on their roles within the organization. The interaction sequences form a pattern over time and begin to extend to an organizational level. This can take place both through formal and informal structure and it constitutes a social memory which stores information about an organization's perception of the environment. 
      • External activities: the surroundings of the organization where knowledge and information can be stored, e.g; former employees, government bodies, competitors, etc.
3. Retrieval:  

The memory of organizations can be retrieved manually or automatically. The latter refers to a straightforward, almost effortless approach to retrieving organizational memory, which is typically part of a pre-established sequence of actions. Controlled or manual retrieval refers to the deliberate attempt to access stored knowledge. 

What Causes Corporate Memory Loss?  

A large corporation without a well-defined continuity plan will lose market share and revenue as customers start buying from a competitor. But make no mistake, corporations are not the only entities at risk; in the public sector, the consequences of “corporate” knowledge loss can be dire. 

The three key causes of corporate memory loss are: 

1. Staff turnover 

One of the biggest problems of corporate memory loss is employee turnover due to leavers, retirement, illness or death. Companies lose time and money filling open positions. It's estimated that each person hired costs $4,000 in recruiting expenses alone! 

2. Knowledge silos 

With hybrid working, the days of discussing business over coffee or lunch meetings in the employee lounge seem as outdated as the fax machines, but it also means some crucial knowledge is lost. 

Not only does work take place outside of the workplace, but it's also increasingly common for specialists from outside the firm to handle certain business functions. Modern businesses frequently connect with a variety of people, including partners, vendors, freelancers and customers. 

3. Data/information overload 

What's worse: the constant noise in your head or all those notifications that keep popping  up? 

Information overload is a real phenomenon that prevents us from taking decisions or actions  because we feel we have too much information to consume. 

The Importance of Corporate Memory 

Corporate memory is a valuable asset for the organization as it incorporates hard-earned insights, high-level experience and technical skills. 

Thinking woman in glasses looking up with light idea bulb above head isolated on gray wall background

Corporate memory can only be applied if it can be accessed. To make use of it, organizations must have archives with effective retrieval systems and good memory recall among current employees. 

Corporate memory can include: 

  • Prior data and information 
  • All internally generated documentation related to the organization's activities 
  • Intellectual property (patents, copyrights, trademarks, brands, registered design, trade secrets and processes whose ownership is granted to the company by law, licensing and partnering agreements) 
  • Details of events, products and individuals (including relationships with people in outside organizations and professional bodies), 
  • Relevant published reference material 
  • Institution-created knowledge 

Of these, institution-created knowledge is the most important. It’s the combination of data, processes, experience, expertise, values and information and it can span decades.  

Explicit or tangible knowledge takes the form of documents, records and reports that can be stored and physically shared between people. Implicit or intangible knowledge includes personal stories, intuition-based learnings and skills that are more difficult to pass on to someone else but can be transferred via training or mentoring. 

How to reduce corporate memory loss 

Here are a number of solutions that can help with corporate memory loss. 

1. A fit-for-purpose intranet

Conventional company intranets have evolved from a static homepage to knowledge-sharing platforms able to unlock hidden corporate value.  

One of the key ways to avoid information overload it to keep things simple, clear and relevant. Does your intranet or digital platform support this? 

Ideally your intranet should also serve as a digital platform for company-wide communication and development, as well as a resource for comprehending and utilizing corporate memory to decrease repetition and promote invention. 

Wouldn’t it be great if you could find the precisely the right expert and suggest them when the conversation with the customer begins? Imagine the time and effort saved in not having to come up with a solution from scratch. 

2. Create a platform to turn tacit knowledge into explicit knowledge 

As mentioned above, there are two different kinds of knowledge: tacit and explicit knowledge. Tacit knowledge is the larger entity as it comprises all of your employees' silent know-how. These concepts and procedures must be converted to explicit understanding as soon as possible - it needs to be standard practice!  

The key is to create a culture that encourages people to share their ideas, and makes it easier for them to contribute their knowledge. The faster people can find information, the easier that information is to act on. 

A couple of practical ideas are to encourage people to write internal self-help blogs, to create and contribute to internal wikis and to reorganise new employee training around a knowledge base, as basic job functions are often best taught on the job. 

3: Use collaboration technology to increase meta-knowledge 

Knowledge is most productively shared across departments when you bring individuals with defined specialties and credentials together. People are more likely to listen to each other when they have goods to trade and both are acknowledged specialists. Take the time to link department heads together to collaborate on tasks and encourage interdepartmental collaboration. 

Collaboration technology facilitates this further. In a study by Professor Paul Leonardi from the University of California, Santa Barbara, researchers found that collaboration technologies increase ‘meta-knowledge.’ 

Gleaning ambient awareness from passively observing communications between other co-workers and teams in a digital environment allows people to seamlessly learn where to get information or access files related to their work. 

After just six months of using a collaboration hub, workers’ understanding of ‘who knows what’ improved by 31%, and subjects increased their knowledge of ‘who knows whom’ by 88%. 

4. Change the way teams are formed

Teams that come together dynamically, based on the mission, or project, at hand rather than a set hierarchy or org chart are powerful and driven. When working alongside people from different departments, people come to appreciate the value of having input from different specialities. And as collaboration leads to success, it fosters greater collaboration and success. 

Loss of knowledge, however it occurs or is described, results in the organization losing competitive advantage and power. Knowledge needs to be managed and retained effectively so that companies can grow and expand without losing their capability. 

Imagine a workplace where everyone is on the same page, collaborating and sharing knowledge in the shared pursuit of big goals. We can help you make this happen with Atlas. 

Learn more about Atlas

We would love to hear more about your experience. How has corporate knowledge loss impacted your company? 

Author bio

Katya Linossi

Katya Linossi

My job is to shape the vision, strategy, culture and performance of ClearPeople. Other than being passionate about making workplaces more inclusive, I enjoy planning our next travel adventure (post pandemic) or trying out a new recipe.

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