Retirement: Companies Keep Know-how in Place

Some companies are taking proactive steps to retain knowledge.

By Seán Ottewell, Editor at Large

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The impending retirement of large numbers of engineers is forcing chemical industry companies to grapple with how to retrieve as much useful information as possible from aging staffs as well as how best to store and re-use this knowledge in a way that will improve business performance. At least a few firms already are well along in their efforts.

Take, for example, Air Products, Allentown, Pa. Although reluctant to mention specific numbers, the company admits a significant portion of its senior technical staff will be eligible for retirement over the next few years. Fortunately, the company began to tackle knowledge-transfer issues in 2000 when it restructured its business units into one global company managed by 11 key global processes.

"As part of this regrouping we needed to be able to transfer knowledge much more consistently. Then about three years ago we looked at particular applications of knowledge management — especially its retention and transfer. This is really important in light of the people coming up to retirement. To compete globally we have to utilize our knowledge much more efficiently," explains Karen Castillo, lead project engineer in the company's Global Engineering Organization (GEO).

We developed concepts on the topic 'transfer of knowledge,' for instance, the early succession plan and the systematic transfer of knowledge.

– Hans-Carsten Hansen, president of human resources at BASF
Air Products participated in a benchmarking study by the American Product Quality Center (APQC), Houston, to learn best practices from other companies. "We observed that we were actually using a lot of the same techniques — such as shadowing and mentoring — but that we needed to apply them in a better way. So in 2008 we kicked off a specific pilot project to further develop these tools and processes," says Vince Grassi, director, global learning and knowledge management.

The pilot, which ends this September, focuses on 20 individuals with critical knowledge in a variety of areas. They include process engineers, product development engineers, liquefied-natural-gas heat exchanger engineers and cold box designers (Figure 1).
Air Products Knowledge Transfer
Figure 1. Company quest: Air Products almost a decade
ago began major efforts to capture critical knowledge.
Source: Air Products.

"We develop a customized knowledge-transfer plan for each individual based upon the types of knowledge to be transferred, the appropriate audience, and the methods to be used to transfer the knowledge. We are using various techniques such as interviewing, shadowing, mentoring, presentations on key topics, storytelling and roundtable discussions," adds Grassi. Each plan is prioritized to ensure that the most important information gets transferred first.

The idea is to develop tools and processes during the pilot that can be formalized into simple-format templates for each manager to use. These then will become part of the normal work process.

To ensure that the initiative is genuinely company-wide, one senior person from each of the 11 business processes — including Castillo, who is also project manager for the knowledge transfer and retention pilot project within the GEO — takes part in a community of best practice.

The result is a huge culture change. "We are asking experts to share their experiences with other people," notes Castillo. "In the past this might have made them feel devalued. But most see that the company as a whole is much more efficient by doing this. We are finding that most of the senior technical experts are also very good teachers and mentors. They are happy to pass on their expertise to others. A few need a little bit of coaxing to participate."

Overall, much of the value of the pilot has come from the discussions among people. "A lot of information — such as design methods and procedures — are already written down. What we are trying to do is capture the tacit knowledge: the first-hand experiences, the lessons learned, those 'rules of thumb,'" says Castillo.

"Eighty-percent of all knowledge is tacit anyway. So it's the conversations that give you the 'why.' We have already documented the 'what.' Their stories tell the 'why'," concludes Grassi.

Broad Problem
The demographic challenge certainly isn't limited to the U.S. For instance, BASF, at its main site in Ludwigshafen, Germany, also must contend with the consequences of an aging workforce, including engineers.

"At the moment nearly 22% of our employees are older than 50 years. Within the next 10 years this percentage will increase to 57%. Then we will face a time period in which 1,200 employees will retire from BASF every year. We have to compensate and intercept the resulting losing of knowledge," says Hans-Carsten Hansen, president of human resources.

To this end the company has begun a program called Generations@Work to preserve both productivity and innovativeness. Besides knowledge transfer, it focuses on sustaining physical and mental wellness, age-appropriate workplaces and systematic maintenance of BASF's image as an attractive employer.

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