Use Czech Results to Check Your Transfer of Tacit Knowledge

Transferring data is easy. Stick it in a document or a spreadsheet and attach it to an e-mail. Load it into a database. Start a wiki. "Explicit knowledge is encoded in formal organizational models, rules, documents, drawings, products, services, facilities, systems, and processes and is easily communicated externally," writes Ludmila Mládková, University of Economics, Prague, in the Global Journal of Business Research.

There is, however, that other kind of knowledge. "The tacit dimension of knowledge is perceived as highly personal and hard to discover and formalize… It is deeply rooted in action, procedures, routines, commitment, ideas, value and emotions. It is always related to a living being or to a group and is difficult to share and communicate," Mládková says. This tacit knowledge that we rely on most to get us through the workday (otherwise, we'd be looking things up every minute) is also the hardest to share. Hence my fear of "Hit-by-a-Bus Syndrome." When knowledge is hoarded, the extended absence of an expert or a workload shock to a critical team can bring important company operations to a grinding halt.

All is not lost, my friends. There are ways to share tacit knowledge, and ways to encourage people to do the sharing. Mládková has been researching how well companies do this in her country, the Czech Republic. Since 2004 she has conducted intense interviews with 145 companies ranging from a seven-person shop to multinational firms. She freely states she has not used a rigorous sampling technique, and thus she refrains from doing statistical analysis on her data. I think, however, her observations should give any CEO or other team leader pause to ponder what their own organizations are doing to spread tacit knowledge.

Based on her review of prior research, Mládková says there are three ways:

• Coaching, in which the expert "tries to articulate (knowledge and skills) and demonstrate them to the apprentice. The enviable part of the apprenticeship is sharing through the non-verbal personal practical experience of the apprentice, carefully monitored by the master."
• Communities, which "are groups of people who have some common interests… and share knowledge, experiences, tools and best practices to solve problems."
• Storytelling, through which the knowledgeable person creates "a virtual experience that enables the listener or reader to create his own tacit knowledge in reality, simulated by the story."

For all the emphasis on coaching in the business literature, the practice is not emphasized in Mládková's sample. Of the 145 companies, only 91 (63%) said they used coaching. Among that subset, 44% used direct managers as coaches even though Mládková calls into question "if they have enough time, knowledge and willingness to be good coaches." Less than 15% of companies using coaches selected them based on experience, work results, or expertise. A miserable 26% paid for coaching. Subtracting the 14% of coaches that were external and had to be paid, this suggests only 12% of the companies rewarded internal knowledge transfer financially, and a miserable 4% did so by other means. In fact, only 5% actively managed their coaching relationships, though 46% got involved when problems erupted.

I found it reassuring that two-thirds of the sample had learning communities, but the results went downhill from there. Only one-quarter reported having formal communities. A stark disconnect appears also:

• Nearly half the companies agreed the communities helped with innovation, quality, and delivery times, and 64% said they improved cooperation.
• Yet 41% provided zero support of any kind to their learning communities; only 23% provided financial support; only one-fifth rewarded participants; and a paltry 16% bothered to measure community performance.

This hands-off approach likely leads to problems: Half the companies said communities refuse to cooperate with other communities, and 40% said communities "create knowledge monopolies." In other words, many companies allow their learning communities to create the very problems knowledge-sharing practices are meant to solve.

Only 41% of the surveyed companies claimed storytelling was used to transfer knowledge. I guarantee the worldwide figure is 100%. Humans are natural storytellers, and I have never been in a company where I did not hear a story told to make a business point. Clearly companies don't even get the concept. Not surprisingly, then, it is an under-used skill in Mládková's sample, with only 30% of the companies saying their managers intentionally used stories to transfer tacit knowledge.

Mládková found the ratio of negative stories to positive ones reported by her companies was 70% to 30%. "The type of stories that prevail in an organization tells a lot about its health," she suggests. "Negative stories indicate the organization is in some trouble and tries to cope," she says. "Positive stories indicate positive changes in an organization." What is the ratio in your company? Your team? What are they telling you about change?

"Results of the research indicate that organizations in the Czech Republic still do not understand the importance of tacit knowledge and do not know how to work with it and how to manage it," Mládková surmises. My experience suggests organizations in the U.S. would not be very different. Do you, dear leader, set up formal coaching arrangements between the experts in your team and other team members, and measure and reward good results? Have you created formal learning communities and given them time and incentives to expand and trade their knowledge? Do you seek out and share stories that will help your people connect the dots between what they do and better ways to do it?

If the answer is "no" to any of these and you are a CEO, I think we just found a source of competitive advantage for your company. But even if you lead only half-a-dozen people, your answer and Mládková's discovery may be pointing out a way to improve team performance and avoid the dreaded Hit-by-a-Bus Syndrome.

Action Item: Identify an area of expertise in your team or company that was mostly developed through work experience instead of formal education. With you team, develop a strategy to use formal mentoring, a learning community, or storytelling to spread that expertise among more people.

Source: Mládková, L. (2012), "Sharing Tacit Knowledge within Organizations: Evidence from the Czech Republic," Global Journal of Business Research 6(2):105.