Staff Turnover as a Possible Threat to Knowledge Loss

Topics: Management, Knowledge management, Business continuity planning Pages: 20 (7091 words) Published: April 6, 2013
Staff Turnover as a Possible Threat to Knowledge Loss
Urbancová Hana, Linhartová Lucie

Abstract The article focuses on labour turnover as a potential threat to knowledge loss. Labour turnover results in an organizations inability to ensure knowledge continuity. In this study, induction was used to identify factors within organizations that determine employees’ exit from organizations. The verifiability of these factors was tested by means of correlation and regression. Subsequently, the presented causes of employee turnover were specified as potential threat to knowledge loss. In the current knowledge economy, employees in an organization are considered the key competitive advantage and the most important asset. If an employee leaves an organization, they take the knowledge they have acquired with them. The loss of knowledge is a potential threat to an organizations existence, especially if an employee with valuable knowledge leaves to join a competitor. Therefore, this paper deals with knowledge continuity as a probable means of eliminating this threat. Dependencies between selected qualitative variables were tested to determine their impact on organizations. The study concludes by indicating that, today‘s knowledge-based organizations must be aware of the main causes and consequences of employee fluctuation so as to maintain their competitiveness in times of economic crisis. Key words: Turnover, employees, knowledge, knowledge continuity, competitive advantage

Employee turnover is considered to be one of the persisting problems in organizations (Armstrong, 2009; Reiß, 2008). In particular if it involves quality employees who have worked for the organization for many years, high performers and experienced and loyal individuals (Branham, 2005, Katcher, Snyder, 2007; Somaya, Williamson, 2008). The turnover means that another organization may gain a new knowledge employee who can become its competitive advantage. The loss of knowledge thus is a threat for the former organization, which increases the significance of knowledge continuity. The available sources state two main ways of knowledge leaving organizations. Beazley (2003) and Stam (2009) state that the main danger for the coming 25 years is in particular the aging population and the retirement of strong age groups; this is supported by statistical data from U.S. organizations. The second way of knowledge loss is turnover of labour (Beazley, 2003; Eucker, 2007). The aging population according to Stam (2009) represents two major risks for organizations, which are the underemployment of older employees and the loss of knowledge. According to the U.S. Bureau of Labor Statistics (Harvard Management Communication Letter, 2003), the issue of knowledge transfer is primarily a challenge for existing American companies. With downsizing, the growing mobility of labour and broader use of random workers, a high percentage of turnover is a reality for the majority of companies. Company managements have to consider how to cope with the potential leaving of their employees for competitors or  Journal of Competitiveness | Issue 3/2011

their retirement. It is one of the essential factors influencing knowledge continuity and it is necessary to eliminate its consequences by means of knowledge management and knowledge continuity management. The objective of the article is to identify factors determining turnover in organizations and to specify their significance. By supporting the tested factors it is possible to eliminate employee turnover and thus reduce the loss of knowledge when employees leave. A partial objective is to test dependencies between selected qualitative variables in relation to knowledge continuity ensuring, which eliminates the threat of knowledge loss, in the process of employee turnover and to confirm their validity or reject them at the selected significance level.

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