Inefficient Knowledge Sharing Costs Large Businesses $47M Each Year

The average large U.S. business loses $47 million in productivity each year as a direct result of inefficient knowledge sharing, according to the Panopto Workplace Knowledge and Productivity Report.

SEATTLE, WA — The average large U.S. business loses $47 million in productivity each year as a direct result of inefficient knowledge sharing. According to the Panopto Workplace Knowledge and Productivity Report, U.S. knowledge workers waste 5.3 hours every week either waiting for vital information from their colleagues or working to recreate existing institutional knowledge. That wasted time translates into delayed projects, missed opportunities, frustration among employees, and significant impact on the bottom line.

In a first-of-its-kind study of more than 1,000 U.S. workers, the Workplace Knowledge and Productivity Report finds that 42 percent of institutional knowledge is unique to the individual. This knowledge was acquired specifically for the employee’s current role and is not shared by any of their coworkers. When that employee leaves their job or is otherwise unavailable, their coworkers are unable to do 42 percent of that job.

Additional findings in the report include:

  • 60 percent of respondents found it difficult, very difficult, or nearly impossible to obtain information vital to their job from their colleagues.
  • The average employee spends 5.3 hours per week waiting for assistance or insights from coworkers. During this time, employees either recreate their colleagues’ existing expertise or simply delay the work in question.
  • Delays due to unshared knowledge have a major impact on project schedules. 66 percent of all such delays will last up to one week, and 12 percent will last a month or more.
  • 81 percent of employees report feeling frustrated when they can’t get the information they need to do their job.
  • 85 percent of employees agree that preserving and sharing unique knowledge in the workplace is critical to increasing productivity.
  • 81 percent of employees state that knowledge gained from hands-on experience is the hardest to replace once it’s lost.
  • In companies with higher turnover rates, employees were 65 percent more likely to state that it could be “very difficult” or “nearly impossible” to “get the information needed to do my job well.”
  • While the average new hire receives 2.5 months of formal training, it can take up to 6 months for an employee to actually ramp up in a new role. These employees often struggle for up to 3.5 months learning the details of their job on their own, seeking out information, and inadvertently replicating work.
  • Nearly 3 in 10 employees believe their organization does not provide an adequate amount of training for its employees. And half of respondents state that their organizations could benefit from providing more training resources and opportunities for employees.

In an era of increasing job specialization and remote work, business leaders must prioritize knowledge sharing to curb productivity losses, reduce employee frustration, and improve the bottom line. This will require technology solutions as well as a shift in organizational culture.

“Every employee in every company contributes to institutional knowledge,” said Eric Burns, co-founder and CEO of Panopto. “However, employee expertise is fleeting when it’s only shared through conversation. To remain competitive, businesses must provide the tools to preserve institutional knowledge and instill a culture of teaching among employees.”

More in Labor