The UK Nuclear Industry: Knowledge Transfer and Retention - Essay Example

Therefore, there is a high risk that a vast amount of critical knowledge accumulated by the first generation of experts since the “Golden Years” of Nuclear Engineering can be lost forever (von Estorff and Debarberis, 2010). Hence, one of the most critical challenges for the UK nuclear industry in the near future will be the development of effective knowledge preservation and knowledge transfer strategies. Ignoring this issue will pose a threat to the safe, reliable and economically efficient operation of nuclear plants as well as will make it impossible to maintain a competitive advantage.

Kahlil Gibran (1883-1931) Modern companies are facing countless challenges in a rapidly changing, unpredictable and unstable world. Nowadays many of them believe that organisational knowledge is a key resource in value creation and knowledge management (KM). Many companies consider that knowledge management can successfully address those increasing challenges (DeLong, 2004; Drucker, 2003; Quinn, 1992; Reich, 1992; Teece, 1998; Tsai and Ghoshal, 1999). In other words, organisations believe that knowledge leveraged effectively can help increase productivity and efficiency, stay competitive, survive the market and economic pressures, satisfy growing customer’s needs, improve decision making and problem-solving processes as well as promote innovations (Gupta et al, 2000; Hahn and Subramani, 2000).

Civi (2000) explains knowledge is a company’s most important asset. Civi (2000) also asserts that knowledge can be worth up to 75% of the company’s value. Although this statement is just an estimate, because knowledge cannot be measured as worth, it shows that knowledge is an important element of a company. That is why knowledge is important to manage effectively. Moreover, many new organisational theories state that organisational knowledge and how it is applied is the only competitive advantage that a company has in the era of the knowledge economy (Gupta et al, 2000; Binney, 2001; Davenport and Prusak, 1997 and Civil, 2000).

In order to understand why timely KM is so important to organisations, the loss of long time employees without new employees as replacements needs to be examined. Even though sometimes the impact of lost knowledge can be delayed, it still will have a tremendous effect and cause a high financial loss as soon as the need for that knowledge arises (DeLong, 2004). One example is during the 1990s Boeing workforce was reduced by 50,000 people. Shortly after the reduction, the company started to experience more problems with aeroplanes than usual.

An investigation performed by the FAA revealed that most errors were in the area of production and engineering. Boeing made a mistake when it reduced strategically important employees. As a result, it had to reemploy 9,000 people in an effort to solve the problems with production and engineering (Leibig, 2001). Another example is from the finance sector. One of the Swiss banks encountered major problems after one of its IT systems experts left the company. In order to solve the problems with their IT system, the bank had to pay $250,000 to this expert to fix the problem since no one else inside the company could find a solution (Probst and Knaese, 1998).