Mitigating knowledge leaks in organisations

Introduction

Many years ago, I was Head of Operations in my organisation. During my tenure, I went from being the least experienced member of my team to becoming a senior member, only second to our department’s doyen. As an operations officer, one of my biggest concerns was knowledge leaks during staff turnover and how long new appointees would take to reach the required levels of competency. A large majority of our resources went into retraining just to keep the system afloat.

After five years, it was my turn to bid farewell to the department whose values I had championed as Head of Operations. During my final two weeks, I focused on ensuring a seamless transition between me and my successor. I shared about my roles and responsibilities, the upcoming milestones, and personal key insights in running operations. Yet, it would only be six months later when my successor decided to leave his role, citing reasons of adjustment issues. Ironically, the very knowledge leaks that I had worked hard to plug, affected the team shortly after my departure.

The department did eventually recover from that setback, but the experience left me probing a deep question: how can we mitigate knowledge leaks in organisations? In this article, I hope to shed light on why knowledge leaks occur, and what are some practical steps which organisations could take to mitigate knowledge leaks.

Knowledge vs. information

We first need to ask the fundamental question of what knowledge is? Russell Ackoff’s DIKW Hierarchy¹ provides a useful framework in understanding what knowledge is and how it differs from information (Figure 1). According to Ackoff, information can be defined as a set of data that is contextually related to each other. For example, a baking recipe (context) that states ‘500 grams of flour’ or ‘1 cup of water’ are measurements of ingredients that provide information to the chef. Knowledge, on the other hand, is information that has been understood such that it provides actionable insights. For example, actionable insight such as ‘bake dough at 180 degrees Celsius for 20 minutes’ is knowledge that is made explicit. We can draw some insights from this; firstly, information is a precursor to knowledge; secondly, information in different contexts can give rise to specific knowledge sets that are insightful and useful. Therefore, it is important that an organisation is aware of critical knowledge that is essential to its operations and can enhance its competitive advantage². Concomitantly, an organisation must be aware of how to safeguard its knowledge well to prevent it from drying up.

Why do knowledge leaks happen?

We arrive at the crux of the issue, which is, why do knowledge leaks happen in organisations? This article discusses two reasons for consideration:

Firstly, as alluded to earlier, is knowledge loss from staff turnover. According to Polanyi³ Knowledge can be categorised into two types: explicit knowledge (EK) and tacit knowledge (TK). For example, the knowledge of baking bread is made explicit in a recipe book through detailed instructions – this is explicit knowledge. When explicit knowledge is codified and shared, it is less likely to be lost to staff turnover or organisational restructuring. In contrast, tacit knowledge resides in the minds of individuals and is gained through experience. For instance, an experienced chef could determine the eventual quality of baked bread just from the smell and touch of the dough – such knowledge is difficult to codify and may not be found in recipe books. When employees leave without capturing or transferring their tacit knowledge, organisations face significant knowledge loss, which could disrupt workflows and reduce operational readiness.

The second reason is due to knowledge decay or broadly, organisational forgetting⁴ which has been defined as either the unintentional or intentional loss of organisational knowledge. Before the COVID 19 Pandemic, many organisations streamlined supply chains to prioritise cost efficiency. However, organisations ‘forgot’ how to manage flexible or resilient supply chains. As a result, many companies struggled to adapt during the pandemic due to a loss of institutional memory. This lesson highlighted the importance of redundancy, without which, a single point of failure could disrupt an entire supply chain.

Based on these two reasons, one could reason that knowledge leaks remain a persistent challenge within any organisation, and if left unchecked, could potentially lead to its demise. The question then remains: what can an organisation do to mitigate knowledge leaks and ensure abundance in its knowledge well?

How can organisations mitigate knowledge leaks?

The key to mitigating knowledge leaks is by ensuring that organisations establish strong and robust knowledge management (KM) systems. KM can be defined⁵ as a systematic process by organisations to create, identify, acquire, use, and share knowledge. Usman and colleagues’ study on KM enablers⁶ provides three suggestions to increase organisational knowledge, thereby mitigating the impact of knowledge leaks. They are:

1. Leveraging on technologies (hardware).
2. Establishing robust processes (software).
3. Building a knowledge-sharing culture (heart-ware).

We shall reference the SECI model to examine how these suggestions would be effective in targeting SECI’s quadrants of knowledge creation⁷ (Figure 2).

1. Leveraging on technologies

History has demonstrated how novel technologies can facilitate the creation and dissemination of knowledge. One notable example was the invention of the steam engine by James Watt, which revolutionized industry in powering machinery and transporting goods and services. Its impact also fostered greater collaboration among engineers, scientists, and industrialists, significantly increasing the rate at which knowledge was created and shared. Boisot’s assessment⁸ of such technological innovation, when effectively combined with processes and people, drives the creation of knowledge assets, and enhances organisational competencies and capabilities.

Even today, technology continues to play a pivotal role in facilitating knowledge creation and transfer. Applying the SECI model, technology aids in externalisation (TK→EK) by enabling individuals to better codify their thoughts. For example, Boeing⁹ uses augmented reality (AR) technologies to provide employees hands-on lessons in immersive virtual simulations while at the same time, creates opportunities for documenting complex procedures in realistic scenarios. Technology also facilitates combination (EK→EK) by enabling the integration of different forms of explicit knowledge. For example, software platforms such as Google Workspace and SharePoint, combined with AI-powered search tools such as Gemini and Copilot, allow employees to store, organise, and retrieve knowledge seamlessly. This ease of access enables knowledge application in new contexts, encouraging creativity and innovation.

2. Establishing robust processes

Effective processes are essential for capturing, organising, and transferring knowledge. The knowledge generation and sharing model by Davenport and Prusak¹⁰ emphasises the need for structured systems to manage explicit and tacit knowledge. We highlight two examples from this model which are knowledge codification and knowledge sharing.

Firstly, knowledge codification, such as the conduct of after-action reviews and exit interviews, is an opportunity for documenting key insights and lessons learnt. This ensures critical information is retained when projects conclude or when employees leave the organisation. Applying the SECI model, knowledge codification is applicable to externalisation (TK→EK). For instance, Toyota’s A3 Report system¹¹ of visually presenting a problem into sequential categories on an A3-sized single sheet of paper gives its employees a standardised approach to solving problems. This system allows the tacit knowledge of problem-solving to be codified which promotes learning among its employees and serves as a repository for solving other related issues.

Secondly, knowledge sharing is about distributing knowledge across the organisation to ensure its availability. Applying the SECI model, knowledge sharing is applicable to both internalisation (EK→TK) and socialisation (TK→TK). This can be done through mentorship programs and cross-training initiatives which are powerful tools for transferring knowledge between individuals. When senior employees mentor juniors or when teams engage in job rotations, they ensure critical skills and insights are disseminated throughout the organisation.

3. Building a knowledge-sharing culture

A culture that values knowledge sharing is foundational to preventing knowledge leaks. According to Nonaka and Takeuchi¹², knowledge creation is deeply intertwined with social interactions. Therefore, encouraging collaboration and mutual trust among employees is key to facilitating knowledge transfer, especially tacit knowledge that resides in employees’ minds. Applying the SECI model, this is applicable to socialisation (TK→TK). Organisations can foster this culture by embracing inclusivity and open communication. For example, companies like Google¹³ prioritise psychological safety, where employees feel secure in expressing ideas and concerns. This openness encourages employees to share critical insights instead of hoarding them, promoting a culture of collaboration and a boldness for coming up with innovative ideas.

Furthermore, leaders play a pivotal role in driving this culture. When the organisation’s leadership recognises and incentivises knowledge-sharing behaviours, such as employees contributing to repositories or mentoring teammates, it reinforces its importance and helps prevent knowledge silos. Thus, organisations could consider embedding knowledge-sharing values into its performance reviews and reward systems. A strong knowledge-sharing culture not only mitigates leaks but also transforms an organisation into a learning entity capable of continuous adaptation and growth.

Conclusion

Mitigating knowledge leaks requires a holistic approach within any organisation. This article explored three essential components of KM systems – technology (hardware), processes (software), and culture (heart-ware) – that encompasses SECI’s four quadrants in creating and sustaining organisational knowledge. By embedding these components into core operations, organisations can not only prevent knowledge loss but also harness its transformative potential to drive innovation, resilience, and long-term strategic success.

Knowledge leaks are a silent threat to organisational resilience, and the discussion on leveraging technology, processes, and culture provides a strong roadmap for mitigating them. Our lecturer Rajesh Dhillon highlights that this is particularly relevant, given the recent wave of layoffs in tech companies across Singapore. Many of these organisations have invested heavily in talent acquisition but failed to embed structured knowledge transfer mechanisms, leaving them vulnerable when key employees leave. The loss of critical expertise, especially tacit knowledge, often leads to disrupted workflows, longer onboarding times, and decreased operational efficiency. Rajesh concurs with the author’s experience when he was serving as Head of Operations and adds that Singaporean organisations need to move beyond just building repositories and rethink KM as an active, embedded process; the recent layoffs should serve as a wake-up call. Overall, Rajesh stresses that organisations who fail to retain and transfer knowledge risk losing not just people, but their competitive edge.

Article source: Adapted from Mitigating Knowledge Leaks in Organisations, prepared as part of the requirements for completion of course KM6304 Knowledge Management Strategies and Policies in the Nanyang Technological University Singapore Master of Science in Knowledge Management (KM).

Header image source: Created by Amoz Yeo with ChatGPT/DALL·E.

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