Managing Knowledge

Organizational knowledge is what makes a company exist. It is a tacit or explicit understanding system of causes and effects. It is formed by previous experiences and is stored in shared mental models, assets, standard operating procedures, rules, and routines. The complexe network of all this knowledge is a source of competitive advantage in itself.

Companies' competitive advantages come from their ability to learn and retain the information that may be useful to them. But companies also forget. Forgetting and learning have trades-off, they can be beneficial or detrimental, voluntary or not. In any case, they can affect companies" performances, in the long term or short term. To be able to perform at its best, a company should be able to remember only what it needs to and forget what must be discarded. Managing knowledge is both about learning that it is about forgetting.

Companies should manage their knowledge for 2 reasons. First, it is costly. When a company forgets what it once knew, it has to spend resources and money to acquire this knowledge back. Not only time and money are spent, but the opportunity cost might also be high. Second, learning depends on forgetting. Transforming your business is as much about acquiring new skills and habits that it is about forgetting the previous ones.

## Managing knowledge through forgetting

To understand how to forget, we must address the different nature of knowledge. It can be new or old, forgotten intentionally or not.

### Accidental Forgetting

Based on the framework, there are 2 types of accidental forgetting. Memory decay, when valuable long term knowledge is lost, and Failure to capture, when new knowledge never actually makes it to the company memory.

Concerning **Memory Decay**, Knowledge that is not used regularly tends to decay. Key people leave the organization, routines are forgotten, relationships break apart and documents are lost or thrown away. Valuable knowledge is often hidden, implicit, informal. This information may be stocked in employee's minds or leftover notes, it is rarely or never formalized properly. The cost of acquiring back these unique pieces of knowledge can be tremendous in terms of money and time. Keeping track of it is also extremely challenging it requires a formal strategy of retaining information and even a designated person to identify and protect the company's knowledge.

**Failure to Capture** refers to the inability of an organization to incorporate, retain, or transmit information. It may occur when an employee leaves the company without transmitting his knowledge. To counter this practice, new knowledge must be made explicit and then communicated to the rest of the organization.

### Intentional Forgetting

If the unintentional forgetting of key knowledge can be damaging for the company, the inability to forget old practice can block it in its past. An organization needs to learn how to unlearn outdated information but also avoid to learn bad habits in the first place.

**Unlearning** is needed when an acquired piece of knowledge has become damaging for the company. It occurs generally when new technologies or market change render previous knowledge ineffective. unlearning require to break down old routines and habits, managerials culture, or even the organization's structure. Once a routine is in place, employees tend to not question the assumption behind said practices, leading to possible wrong decision makings.

The best alternative to unlearn may be to not learn in the first place. Step in to avoid **Bad Habits** to take holds. This requires a strong skill in distinguishing good and bad habits as they form, and the ability to foster one while blocking the other. As your organization builds up learning capability, it should also build strong identifying skills. Leaning is easy, learning the right thing is harder. We tend to overly value the learning from or mistakes or failure for example. Distinguishing the good learning and the bad from the whole package may be tremendously difficult too.

### The pitfalls

* A common pitfall is the raise of "heroe" employees, the experts that know something nobody else does, the ones that can stop an organization from functioning if they leave. Managers should connect these employees with others so they can share their knowledge. However, they may see the sharing as a potential threat to their survival in the company. giving financial incentives or even offering to replace outdated skills with new ones could soften the process.
* Nobody likes to change. Forgetting old habits and learning new ones could jeopardize some employee status. They will fight the status Quo unless they are given a reason to change.
* Sometimes, the learning you are trying to forget is so embedded in your business practice that unlearning may put your whole business at risk. You may want to go to the extreme of selling part of your company or dilute a business unit into your organization.
* Overlearning from failure or mistakes

## Readings

Managing organizational forgetting - Pablo martin de Holan.