100000 Man years of Experience Lost | Retiral Effect on SBI

Most PSUs (public sector units) in India report to market how much they provision for gratuity every year.

And gratuity is a simple calculation, viz. Gratuity = 15 / 26 X Number of years of experience X Base salary

With this we can calculate

Number of Man years (experience) lost for the year = ( Gratuity provision X 26 / 15 ) / average base salary

I did this for one of the largest PSUs of India namely State bank of India and here is what I got

Number of employees = 222933

Total Staff Cost = 14480 Cr

Provision for Gratuity = 1565 Cr

Provision for Pension = 2473 Cr

Average Salary = 0.0468 Cr (4.68 lakhs) (this number includes both base salary and other perquisites/bonuses)

Number of Man years (experience) lost for the year (min estimate) = ( 1565 X 26 / 15 ) /0.0468) = 57962 man years

Even if you consider double this average salary as Base salary this accounts for 26000 man years (experience) loss per year.

That is a significant level of experience to lose every year and seeing that provisions have increased by almost 40 times this issue will only get much worse going forward

That is one of the grandest problems of KM I have ever encountered

UPDATED: doubled average salary at retirement as it was more realistic

 

Notes on Knowledge Continuity

I was part of a content creation for the bspin conference recently held at Bangalore on Knowledge Continuity. These notes of mine which were part of the first version which got morphed into totally something else when we finished. I felt there were some key points here that may interest Knowledge Managers. So here it goes…

Knowledge Continuity 3 D

Business continuity (for target vectors like performance, functionality, availability, ability to change, etc in IT Services) is provisioned by Knowledge continuity.

Knowledge Continuity cuts across 3 dimensions

1. People Interface/Relationships

· Such as between roles that work only in few phases (tester, BA, Architect) or between vendor and business user

2. Time

· Such as tenure in domain/account/technology

3. Content

· Such as standard operating procedures and heuristics of how experts handle crisis and how it is traded or exchanged

Common reasons that lead to loss of continuity include

1. Forgetting

2. Attrition

3. Too much or too little governance/processes

KM Strategy

Knowledge management as a strategy for achieving continuity intervenes by each of these dimensions

1. Interface: Building newer relationships across diverse groups

· Participative culture builds relationships and sustains rituals

· Diverse (not in bred) relations are formed as part of social network stimulation

2. Time: Bridging gap between expert and novice

· High Cost Experienced Resource versus Profitability equation

· Concept mapping and expertise transfer as methods to reduce time to become expert in the knowledge domain

3. Content: Sustained Knowledge creation socially

· Wiki as a preferred tool, how peer review helps in increasing quality of wikis, differences between closed and open wikis

· Structured Story Listening methods and AARs (after action reviews)

Success Determinants

Success of such KM strategy will be determined by the following

1. Culture prevalent in the enterprise, specifically drivers that create habits

2. Information and Communications Technology and its social utility value (the bargain)

3. People Policies

How to deal with Avoid Task and Seek Attention behaviours?

Below 2 behaviors are common in the workplace that is necessary for every change agent to understand. They are critical to every change and system roll out.

Task Avoidance Behavior

Task avoidance behavior manifests as excuses even when there is agreement that the system or change is a worthwhile thing to try. There are many games like the Yes, but… that makes it difficult to spark action. To work around this issue, what I do typically is keep collecting excuses, and for each of the excuses find what “the precious” is, it could be time, effort, attention, presence among many others and gift them free.

Attention Seeking Behavior

Attention seeking is not really a problem, but it requires significant effort usually in the form of habits to sustain action. Social media actions like "like", +1 or transactional superlatives like "awesome" or even a simple "pat on the back", “Bravo” are undervalued. So to sustain attention it is necessary to come up with ideas that are high pedestal and keep coming up with ideas for different actions. If the prize or attention is easily gamed then it diminishes in value and no longer encourages action. So here the change agents’ job is to come up with large number of ideas using simple techniques like Forced Association, on what is available and direct attention to the action and not the pedestal.