Institutional Memory

(Photo by Luca Recchia at Scopio)

One of my posts last week was about archives and called them societal memory.

Most businesses, even large ones, don’t maintain a formal archive of their past. They do have institutional memory, regardless of whether they realize it. A large portion of the value of the business depends on it. But if a business isn’t aware of that, it isn’t well cared for or protected, and that can have serious consequences.

In business acquisitions, this is why a business with thorough, fully documented, well used policies and procedures commands a higher price than a business of the same type and size that has not taken such care with its methods. Usually, the justification for the price premium is that having complete, documented procedures indicates the business is well run. That isn’t necessarily true. The policies and procedures could be extensive, documented, and terrible. But it’s more likely for a good business to formalize its methods than for a bad one to go to the bother.

We tend not to think about it in terms of institutional memory, but we should. When the way a company does things is not documented, all the knowledge about how things should be done resides in the company’s people. Losing key people can kill the business.

Sometimes one person is at the heart of a business. Seymour Cray was the big name in the design of supercomputers. For many years, Cray computers were synonymous with supercomputers. Massively parallel computing pushed supercomputers aside, taking on comparable computing tasks at a lower price/performance ratio. But in their heyday, supercomputers were the only way to tackle certain types of tasks such as climate modeling.

Cray Computer Corporation folded in 1995, no longer able to sell supercomputers. In 1996, while on a contract in Colorado Springs, every workday I drove by SRC Computers, the company Cray had recently started to design a massively parallel computer. One day I saw in the local news that Cray was dead. On the interstate highway at the north side of town, another driver in a big hurry cut him off, causing his car to crash. I remember feeling stunned.

SRC Computers was able to carry on as a business, although it changed its focus to reconfigurable computing. That was possible because the company wasn’t completely dependent on Cray’s genius, having just started on a path that was relatively new for him as well as for anyone else in the company.

If he had died in the midst of designing his famous supercomputers, it would have been an entirely different story. A lot of science we rely upon now would have been delayed until massively parallel computing came along to tackle it. In some fields such as climate science, the consequences don’t bear thinking about.

But essential institutional memory doesn’t always involve a unique genius or something exotic.

Years ago an artistic friend got terribly upset because her favorite brand of charcoal sketching pencil was no longer being made. No other brand was like it. The feel of it, the subtlety she could achieve in a sketch, was incomparable.

If I remember correctly, somebody bought the company that made the pencils. The new owner dictated new terms of employment that the workers hated, so they quit.

The workers were the only people who knew how to make the pencils turn out so uniquely pleasing. They took their knowledge with them. That killed the company.

Last week, after the archives we toured the Calderdale Industrial Museum. The old machines in there deserve a post, or maybe an entire book, of their own. Some of them have clearly documented manuals about how to maintain them and use them. Some don’t.

There is a loom that makes carpet the way it was done when weaving patterns on factory looms were driven by holes punches in hard cards. It occupies an entire large room. On Saturdays the museum runs it. A woman tends to the huge number of spools of colored yarn feeding the machine, and when a yarn breaks she quickly ties together the ends. A man runs the loom.

The museum staff mentioned he’s the only one who knows how to run it. He’s got to train somebody to make sure institutional memory will carry on.

If you have a business, school, organization of any kind… it has institutional memory too, one way or another. It’s probably more complicated than a few documents you can archive. And if you want the organization to carry on and on into the future, its institutional memory needs to be nurtured and protected. Just in case.