HRM 5600 Module 2 Written Assignment: Capturing What Veteran Underwriters Know Example

Before the Experts Retire: A Knowledge Management Strategy for Garden State Mutual

Student Name

Master of Science in Human Resources Management, Thomas Edison State University

HRM-5600: The Entrepreneurial Organization: Learning as Competitive Advantage

Mentor Name

Month Day, Year

Before the Experts Retire: A Knowledge Management Strategy for Garden State Mutual

Introduction

Garden State Mutual's underwriters know things that are written down nowhere: which contractors cut corners, how a coastal neighborhood floods, which questions reveal that an applicant is hiding a prior claim. Twenty of its 60 senior underwriters could retire in the next five years. If their knowledge leaves with them, the company will lose both underwriting quality and the raw material for new products. This assignment applies knowledge management theory to that problem.

Foundational Theories

Tacit and Explicit Knowledge

Explicit knowledge can be written and shared in documents, databases and manuals. Tacit knowledge is personal, rooted in experience and hard to put into words; Polanyi's observation that "we can know more than we can tell" is often cited to describe it. Most of what makes Garden State Mutual's best underwriters valuable is tacit.

Nonaka's Knowledge Creation Spiral

Nonaka (1994) proposed that organizations create knowledge through four conversions. Socialization shares tacit knowledge through shared experience, as when a junior underwriter works beside a senior one. Externalization turns tacit knowledge into explicit concepts, through dialogue, metaphor and models. Combination joins explicit knowledge into new systems, such as a rating guide. Internalization turns explicit knowledge back into tacit skill through practice. Knowledge grows as it moves through this spiral from individuals to groups and the organization.

Knowledge Management Systems and Strategies

Alavi and Leidner (2001) reviewed how information systems support knowledge creation, storage, transfer and application, and stressed that technology helps only when it fits how knowledge is actually used. Organizations often choose between two strategies: codification, which captures knowledge in databases for reuse, and personalization, which connects people so they can share knowledge directly.

Applying the Theory

Because underwriting expertise is mainly tacit and judgment-based, a codification-first strategy would capture only the easy part. Garden State Mutual should lead with personalization and use codification to support it.

Communities of practice deserve emphasis. Brown and Duguid (1991) argued that much learning happens in informal groups of practitioners who share problems and stories, and that organizations should support these groups rather than replace them with formal procedures. A community that brings underwriters and claims specialists together would also expose patterns, such as recurring claims on new types of smart home devices, that could become product ideas.

Barriers to Knowledge Sharing

Szulanski (1996) found that the main barriers to transferring practices inside firms were not motivation but the recipient's lack of capacity to absorb the knowledge, unclear cause-and-effect relationships and difficult relationships between source and recipient. At Garden State Mutual, juniors may lack the background to understand why a senior made a decision, and some seniors may fear that sharing reduces their value. Pairing over months builds absorptive capacity, and recognizing mentoring in performance reviews and retirement transition plans reduces the fear.

Knowledge Management and Entrepreneurship

Knowledge management supports entrepreneurial behavior in two ways. It preserves the deep knowledge of risk that new products need, and it creates places where knowledge from different functions meets. A new product idea usually comes from combining knowledge that was previously separate, such as claims patterns and underwriting rules, which is exactly what the community of practice and case library make possible.

Conclusion

Garden State Mutual's expertise is mostly tacit and at risk of retiring. A personalization-first strategy built on Nonaka's spiral, supported by a case library and a cross-functional community of practice, preserves that expertise and turns it into material for innovation, setting up the organizational learning analysis in Module 3.

References

Alavi, M., & Leidner, D. E. (2001). Review: Knowledge management and knowledge management systems: Conceptual foundations and research issues. MIS Quarterly, 25(1), 107-136. https://doi.org/10.2307/3250961

Brown, J. S., & Duguid, P. (1991). Organizational learning and communities-of-practice: Toward a unified view of working, learning, and innovation. Organization Science, 2(1), 40-57. https://doi.org/10.1287/orsc.2.1.40

Nonaka, I. (1994). A dynamic theory of organizational knowledge creation. Organization Science, 5(1), 14-37. https://doi.org/10.1287/orsc.5.1.14

Szulanski, G. (1996). Exploring internal stickiness: Impediments to the transfer of best practice within the firm. Strategic Management Journal, 17(S2), 27-43. https://doi.org/10.1002/smj.4250171105