A comparative analysis of knowledge retention strategies at selected banks in South Africa

Abstract

The purpose of this study was to analyse knowledge retention strategies at selected banks in South Africa. A comparative analysis of knowledge retention strategies at two leading South African banks underpinned the focus of this study. The importance of retaining organizational knowledge assets is highlighted in this study. A survey research design was used to collect quantitative data from middle-level managers at selected banks. All usable quantitative data were collected from middle-level managers through the use of Survey Monkey and Zoomerang – an online survey platform. The quantitative data were analysed through the use of Microsoft Excel 2010. One of the shortcomings of using the quantitative research methodology was failure to ask probing questions where questionnaires were used. The study established that selected banks did not have formal knowledge retention strategies. From the findings, there was no specific knowledge management (KM) policy guideline to inform selected banks on how to retain organizational knowledge; however, there is was an acknowledgement of the presence of communities of practice, mentoring and apprenticeship, subject matter experts, leveraging retirees, knowledge portals and storytelling. In this study, originality was premised on setting down a major piece of new information utilizing the General Knowledge Model premised on four KM practices, namely, CREATION, SHARING, TRANSFER and RETENTION. These four KM practices should be recognized as fundamental pillars of KM.

Keywords

Knowledge assets knowledge management knowledge retention strategy

Introduction

Papmehl (2007) asserts that knowledge is in high demand in today’s economy but in short supply, and if organizations do not succeed in attracting and retaining tacit knowledge, there will be a negative impact on their bottom line. In the knowledge-based economy, managers are expected to focus on issues of knowledge capital over more traditional assets and on the capability of their organizations to harness these knowledge assets. Banks should utilize their knowledge resources effectively to create competitive advantages and develop a greater ability to act and adapt to the ever-changing tastes and needs of customers (Chigada and Ngulube, 2014). A bank’s competitive advantage is enhanced when management embraces knowledge management (KM) philosophy as a strategic asset central to product and process innovation, executive decision-making and organizational adaptation and renewal.

Theoretical foundation

This study was premised on the General Knowledge Model (GKM) as illustrated in Figure 1. The GKM comprises four KM fundamental practices that form the backbone of KM philosophy. The GKM arranges KM activities in a chronological but deterministic way, allowing rigorous automated knowledge to flow through complex knowledge systems from an asynchronous process. The model was adopted in this study because it allowed the researcher to trace individual knowledge retention strategies and understand how effective each strategy was to specific actions and decisions. Schiuma (2012) opines that managers should be interested in managing knowledge not for the sake of KM, but the design and planning of how organizational knowledge assets should be preserved and utilized to enhance organizational performance. As shown in Figure 1, the first KM practice in the GKM is knowledge creation which comprise of activities associated with the entry of new knowledge into the organization. This means that there is a need to identify and recognize organizational knowledge assets as they enter, discovered or captured in the organization. Once knowledge has been created, there is need to retain that knowledge through preservation and maintaining the viability of knowledge within the system. Retained knowledge should be allowed to flow from one part to the other (sharing), filtering, translation, conversion and rendering. Shared knowledge should be utilized or applied to business processes.

Figure 1.

General Knowledge Model (Chigada, 2015).

Statement of the problem

Cheese et al. (2008) opine that the increasing fluidity of global employment markets, shifting workforce demographics and changes in the nature of the work make it more difficult for organizations to attract, retain and engage employees. There is thus a strong focus on retaining the talent of the organization and looking at new ways to achieve this. The selected banks in South Africa have been facing staff attrition culminating in organizational knowledge loss. In view of the aforementioned, this study explored the current knowledge retention strategies at two leading South African banks. Key employees who create intangible value-adding assets, and who often transport those assets in their heads when they change employers, were leaving the banks in large numbers; resulting in the banks’ activities being adversely affected. Mass exodus of experienced personnel presented challenges where knowledge and expertise were not shared or transferred to other employees; culminating in voids that eroded innovation and the risk of unavoidable mistakes increases, becoming a regular occurrence. Knowledge which is key in today’s organizations can be categorized as either explicit or tacit. Explicit knowledge refers to knowledge that can be formalized and captured, such as learning from a text book. Clark (2004: 1) defines tacit knowledge as ‘personal knowledge embedded in individual experience and involves intangible factors such as personal beliefs, perspective and the value system’. When knowledge workers leave an organization, both explicit and tacit knowledge leaves with them.

The objective of this study was to investigate knowledge retention strategies at selected banks in South Africa. The study was informed by the following research questions:

What knowledge retention strategies are used at selected banks?

To what extent are the knowledge retention strategies effective?

Literature review

This study was undertaken after realizing that the impact of the fast-changing information environment of the 21st century makes it reasonable and necessary for an organization such as a bank to determine and define what constitutes its knowledge assets. The importance of such a knowledge capability for an organization has come to be conceptually well-understood because knowledge is so different from other organizational resources and as such, organizational knowledge should be safeguarded (Chigada and Ngulube, 2014). The confluence of current economic, generational and human influences on the workforce causes a greater number of employees to shift in and out of jobs, departments and companies, draining organizations of critical skills and knowledge. Therefore, the contemporary business manager is faced with a daunting task to preserve organizational knowledge assets. This entails designing and implementing knowledge retention strategies. Hough et al. (2010) define a strategy as a method or plan chosen to bring about a desired future such as achievement of a goal or solution to a problem. Loss of organizational knowledge assets is a problem that requires immediate solutions; hence, the widely acknowledged knowledge retention strategies are as follows:

Communities of practice

Communities of practice (COP) are voluntary groups of people held together by a common sense of purpose, sharing a set of problems, concerns and a passion for a particular topic. Experts deepen their knowledge and expertise in a particular area of concern by interacting on an ongoing basis with a real need to know what each other knows (Albers, 2009; Wenger, 1998, 2006). Construction projects envisage COP where project managers, civil engineers, mechanical engineers, electrical engineers, architects, designers, structural engineers and other experts converge to work on a specific project in order to improve shareholder value and needs. Jain (2011) posits that such people have a common sense of purpose and common interests; they share work-related knowledge and experiences and engage in a collective process of learning. The use of COP allows individuals to share both tacit and explicit knowledge by taking information and materials. Banks operate distinct strategic business units engaging in varying levels of project management; thus, COP become ideal platforms for sharing and acquiring knowledge. It is difficult to transfer tacit knowledge; therefore, the use of COP helps knowledge transfer from the experienced, skilled, talented old employees to the new employees through projects or meetings (Jain, 2011). The use of COP denotes knowledge creation practice as shown in the GKM and such activities are imperative in the organization.

Mentoring and apprenticeship programmes

Mentorship and apprenticeship programmes are designed for transferring knowledge from experienced employees to the inexperienced employee (Nonaka, 1995). Mentorship entails the pairing of an experienced member of staff with an inexperienced or new employee in order to assist the new employee in acquiring new knowledge (Beazley et al., 2002). In the event that succession planning programmes are put in place, mentorship is adopted to ensure the inexperienced employee is prepared enough and ready to perform in a job role. Nel et al. (2012) state that during mentoring and apprenticeship training, senior or experienced managers transfer their knowledge, wisdom, specific insights and skills to their juniors within a short space of time so that, when the experienced employees leave the organization, the organization’s practices, knowledge, history, stories and culture are preserved. Similarly, organizations use internships as knowledge sharing strategies. The Oxford Online Dictionary (2015) defines an internship as an opportunity offered by an employer to potential employees, called interns, to work at a firm for a fixed, limited period of time. Interns are usually undergraduates or students, and most internships last for any length of time between one week and 12 months. During the internship, the interns are exposed to real work settings, work with mentors or experienced employees who transfer their knowledge, expertise and experiences to the interns, which is represented by knowledge transfer in the GKM shown in Figure 1.

Subject matter experts

Subject-matter experts (SMEs) are experienced individuals who demonstrate a mastery of a particular topic or job (e.g. a computer systems engineer or a pilot) and play a crucial role in KM in the organization because they can provide solutions. The Oxford Online Dictionary (2015) defines an SME or domain expert as a person who is an authority in a particular area or topic. Banks employ project engineers, systems engineers, business analysts and other critical skills. Banks are leveraging on highly skilled individuals to create and share knowledge assets. Nel et al. (2012) opines that retention of scarce skills is proving to be a challenge for many organizations due to global war for talent. The use of SMEs is in line with knowledge utilization practice, as shown in Figure 1, where different activities and events connected to specialists apply knowledge to business processes.

Leveraging retirees

Retirees are used by organizations as consultants who provide critical skills and experience for special projects or assignments to mentor junior and less experienced employees, thus allowing them to share knowledge and experiences. Retirees should be allowed to return to work as consultants who are immediately productive as they know the organization (Poole and Sheehan, 2006). Organizations can adopt a phased retirement approach where employees reaching retirement continue to work with reduced workloads (Wamundila and Ngulube, 2011). The South African labour market like other economies faces skills shortage in specific fields such as information technology, engineering, health and accounting due to a low throughput ratio from tertiary institutions. With reference to skills shortages, organizations resort to leveraging retirees as sources of knowledge and expertise to solve complex business problems (Poole and Sheehan, 2006). Retirees are hired for a specific period of time to work on special assignments; thus providing opportunities for knowledge acquisition (less experienced employees) and knowledge sharing (experts).

Storytelling

This strategy envisages people-to-people interactions, COP and teaching of lessons learnt, and storytelling provides the required interaction set-up (Poole and Sheehan, 2006). Storytellers in an organization maintain cohesion and provide guidelines for people to follow (Holbeche, 2005). Stories are instrumental for knowledge sharing and collaboration, because listeners are given an opportunity to ask questions which then puts the story into perspective. An organization that adopts any or all of the knowledge retention strategies highlighted above is regarded as a learning organization or one that has recognized the importance of knowledge. It should be noted that storytelling is not as effective as other strategies discussed if there is interference. The use of motivational speakers is becoming a globally accepted strategy for information sharing. Famous motivational speakers such as Robert Kiyosaki, Chris Garner and Tony Robbins are essentially storytellers whose aim is to share personal life experiences. The audience has the opportunity to ask questions culminating in knowledge sharing.

Knowledge artefacts

The Oxford Online Dictionary (2015) defines an artefact as a man-made object of cultural or historical interest and these include documents, files, papers, conversations, pictures, thoughts, software, databases, email messages, data sets, winks and nods, and whatever else can be used to represent meaning and understanding. In the daily life of a knowledge worker, artefacts are fundamental objects in the knowledge stream, resulting in knowledge artefacts. Repository-based knowledge management systems are a typical KM initiative employed in today’s organizations to promote knowledge sharing between their members (Weber et al., 2008). In the process of knowledge sharing, it should be borne in mind that the knowledge to be shared is retained in knowledge artefacts, such as lessons learned, alerts or best practices. The contemporary cyberspace advocates the use of databases as information repositories that allow information and knowledge seekers access to metadata. Knowledge artefacts represent knowledge retention in the GKM.

Methodology

This study was conducted at two leading South African commercial banks, whose head offices are in Johannesburg, Gauteng Province, with each bank having approximately 600 branches countrywide. Data were collected from selected banks’ geographically dispersed middle-level managers. The geographic locations of the respondents for this study envisaged the adoption of a quantitative research methodology. A web-based open-ended questionnaire was designed and distributed to all middle-level managers through the use of Survey Monkey.

The quantitative research methodology was adopted because it enabled the researchers to collect large volumes of data from many research respondents; thus, culminating in rich sets of data was extracted from diverse participants (Chigada and Ngulube, 2014). Data were presented in numerical, percentages and tabular format (Babbie 2010). Stangor (2011: 15) opines that quantitative research is descriptive research that uses more formal measures of beliefs, attitudes, intentions and behaviour, including questionnaires and systematic observation of behaviour that is subjected to statistical analysis. After receiving all quantitative data through Survey Monkey, the researchers exported the results to Microsoft Excel 2010 for analysis because the tables and figures created by Survey Monkey did not depict the intended picture of the findings. Microsoft Excel 2010 was user-friendly package whose bar charts and pivotal tables allowed the researchers to display two or more dimensions of data in a convenient format. Data were presented in frequency tables depicting the findings from the study.

Findings and discussions

One hundred and ninety (190) questionnaires distributed and 101 (53.15 per cent) responses were received which were consistent with the findings of Greenlaw and Brown-Welty (2009) who found out that a response rate of 51.58 per cent from a web-based survey tool was higher than many responses rates of that type of survey as reported in literature. Of the 101 respondents who participated in the study, 58 (57.43 per cent) of the respondents were from bank A and 43 (42.57 per cent) were from bank B. Responses were envisaged from the participants to provide their opinions on which strategies were used in safeguarding knowledge in their banks. Respondents indicated the following knowledge retention strategies:

COP,

mentorship and apprenticeship training,

SMEs,

leveraging retirees,

storytelling,

succession planning and

establishment of knowledge portals.

Communities of practice

Of the responses received, 20 (19.8 per cent) felt that COP helped transfer knowledge from the experienced, skilled, talented old employees to the new employees; 14 (13.86 per cent) of the respondents were from bank A, while 6 (5.94 per cent) of the respondents were from bank B. The findings showed that bank A used COP as the main knowledge retention strategy compared to bank B. The rate (7.92 per cent) of responses between bank A and bank B is significantly huge; an indication that COP was a vital strategy for bank A. At bank A, employees shared work-related knowledge and experiences through COP which is consistent with the findings of Mngadi and Ngulube (2009) who established that some academics at the University of KwaZulu-Natal and University of Zululand utilized COP to share knowledge. The wide use of COP at bank A justifies this practice because the bank thrust its processes on a project-based approach. The main challenge foreseen in banks that prevents employees from belonging to a COP is the aspect of stringent confidentiality policies.

Mentoring and apprenticeship

The second knowledge retention strategy that emerged was premised on mentorship and apprenticeship. Mentorship allows senior or experienced managers to transfer their knowledge, wisdom, specific insights and skills to their juniors or less experienced colleagues within a short space of time. Eighteen (17.82 per cent) respondents indicated that their bank used mentorship and apprenticeship as a knowledge retention strategy. Twelve (11.88 per cent) of the respondents were from bank A, while 6 (5.94 per cent) of the respondents were from bank B. Comparatively bank A leveraged mentorship and apprenticeship than bank B as evidenced by a 5.94 per cent response rate difference between the two banks. Popularity of mentorship strategies is attributable to the ability of senior or experienced managers transferring their knowledge, wisdom, specific insights and skills to their juniors. Nel et al. (2012) state that senior managers can impart organizational knowledge assets to juniors before experienced employees leave the organization so as to preserve the organization’s practices, knowledge, history, stories and culture.

Subject matter experts

Twenty-two (21.8 per cent) of the respondents said SMEs played a crucial part in their bank by demonstrating a mastery of a particular topic and impart their knowledge to less experienced colleagues. Interestingly, more (11.88 per cent) respondents were from bank B, while 10 (9.91 per cent) respondents from bank A culminating in a 1.97 per cent response rate difference in favour of bank B. Although the response rates were close to each other, the findings showed that process engineers, economists, systems engineers, software engineers, fraud detectives, financial managers and actuaries were classified as SMEs at selected banks. These individuals provide expert solutions; which best explains why bank B has been leading in mobile banking technology solutions in South Africa.

Leveraging retirees

Retirees are used by organizations as consultants who provide critical skills and experience for special projects or assignments to mentor junior and less experienced employees, thus allowing them to share knowledge and experiences. The use of retirees as consultants who provide critical skills and experience to junior mentors was perceived as one of the strategies a bank can adopt. Eleven (10.89 per cent) of the respondents from bank A and 8 (7.92 per cent) of respondents from bank B stated that retirees played an important role in retaining organizational knowledge assets. From the illustrations in Table 1, bank A was using retirees in response to skills shortages, as sources of knowledge and expertise to solve complex business problems (Poole and Sheehan, 2006).

Table 1.

Strategies for safeguarding knowledge at selected banks (N = 101).

Strategies for safeguarding knowledge at selected banks	Bank A frequency	Bank B frequency	Total number of respondents
Communities of practice	14 (13.86 per cent)	6 (5.94 per cent)	20 (19.8 per cent)
Mentoring and apprenticeship	12 (11.88 per cent)	6 (5.94 per cent)	18 (17.82 per cent)
Subject matter experts	10 (9.91 per cent)	12 (11.88 per cent)	22 (21.8 per cent)
Leveraging retirees	11 (10.89 per cent)	8 (7.92 per cent)	19 (18.81 per cent)
Storytelling	4 (3.96 per cent)	–	4 (3.95 per cent)
Succession planning	3 (2.97 per cent)	2 (1.98 per cent)	5 (4.95 per cent)
Knowledge portals	4 (3.96 per cent)	9 (8.91 per cent)	13 (12.87 per cent)
Total	58 (57.43 per cent)	43 (42.57 per cent)	101 (100 per cent)

Storytelling

The other finding from the study was that storytelling was not widely used at selected banks, but respondents acknowledged its existence as knowledge retention strategy. Four (3.96 per cent) of the respondents from bank A, while bank B did not have responses regarding the usage of storytelling. The low response rate was probably attributable to the fact that selected banks relied more on information communication technologies to share ideas and information; hence, storytellers were not highly regarded. However, Holbeche (2005) emphasizes that stories are instrumental for dialogues between listeners and storytellers.

Succession planning

As illustrated in Table 1, 3(2.97 per cent) and 2 (1.98 per cent) of respondents from bank A and bank B, respectively, indicated the existence of succession planning programmes in their bank. Wolfred (2008: 3) states that succession planning entails all plans put in place to replace leaders or key individuals when then leave the organization through resignation, deaths, retirement or dismissal from work. The presence of succession plans in both banks signifies the importance attached to survival and continuity expected by leadership of banks. Groehler and Caruso (2013) state that succession plans are systematic knowledge retention and development of intellectual capital programmes for business survival.

Knowledge portals

Respondents from both banks indicated the existence of knowledge portals. The majority (8.91 per cent) of respondents from bank B indicated that their bank advocated for the use of knowledge portals to retain organizational intellectual capital. Four (3.96 per cent) of respondents from bank A concurred that knowledge portals were gaining popularity in their bank as well.

The study revealed that selected banks used other strategies for safeguarding knowledge such as job rotation, staff secondment and promotions. Safeguarding institutional knowledge can leverage efficiency across an organization’s services to all stakeholders through accessing the right information and converting that information into knowledge (Chigada and Ngulube, 2014). The loss of organizational knowledge through workforce attrition can be dire to the organization. Part of the banks’ critical knowledge largely rests with people rather than processes; therefore it is paramount to preserve such knowledge before it leaves the organization. Failure to harness the expertise of senior or experienced people, the potential to innovate is eroded and the risk of unavoidable mistakes increases, becoming a regular occurrence (Albers 2009). Knowledge loss can negatively affect the operations and performance of the bank. The loss of expertise and on-the-job knowledge that was built up over the employee’s career, the loss of client intelligence, established internal and external networks and loss of social and networking skills are some of the risks of losing implicit knowledge in organizations due to staff attrition (Gupta and Govindarajan, 2000).

Conclusion

The study established that COP (13.86 per cent) was the preferred knowledge retention strategy at bank A, while bank B preferred the use of SMEs (11.88 per cent). Mentorship and apprenticeship (11.88 per cent) was the second most preferred strategy at bank A, while bank B utilized knowledge portals (8.91 per cent) as the second most preferred knowledge retention strategy. Failure to harness and retain organizational knowledge exposes the organization’s weaknesses to competitors. Competitors thrive on weaknesses of their opponents for competitive advantage. This study was important because awareness was created on the importance of retaining intellectual capital. Although the study revealed the existence of knowledge retention strategies, more effort was needed to improve the current approach to knowledge retention. Global war for talent is a fast growing topical debate that affects knowledge retention in banks; therefore, banks need to devise ways of retaining employees’ know-how and best practices so that knowledge can be passed onto future workers and replacements (Thilmany, 2008).

Further research

Areas that envisage further interrogation include institutional policies relating to the extension of retirement age, use of information communication technologies as platforms for safeguarding organizational knowledge and how change is managed in the knowledge economy. The use of knowledge portals is an interesting area that warrants further research to determine the architecture required for such KM systems.

Footnotes

Declaration of Conflicting Interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

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