When Someone Leaves
Someone resigns and suddenly the smooth-running process judders. Reports don’t reconcile, customers chase, small fires appear. The manager insists the handover was done properly. The process map looks fine. But something’s missing.
The truth emerges slowly: what the business thought they did, and what they actually did, were different things.
These gaps reveal fragility. Mid-sized companies carry more single points of failure than they’d care to admit. Beneath the tidy diagrams sit invisible seams of judgement, tacit skills, and accumulated fixes that make the system actually work.
The gap is between knowledge and knowhow. Knowledge is explicit - it sits in documents, job descriptions, training decks. Knowhow is embodied. It’s the subtle adjustment, the timing that makes the flow work, the fix you only learn by having seen the problem before.
Economist César Hidalgo makes this point in Why Information Grows: information alone doesn’t create prosperity. What matters is knowhow - embodied in networks of people who can combine and recombine skills. It’s not what’s written down, but what’s enacted.
Businesses confuse the two constantly. They think the process map is the process. It isn’t.
The shift is to stop treating knowhow as disposable and start treating it as capital. That doesn’t mean turning everything into a manual. It means four moves.
First, spot the fault lines. If this person walked tomorrow, what would break? Those hidden dependencies are where the asset lives. Naming them openly is the first act of protection.
Second, make it visible. Not everything that sits in someone’s head is worth keeping. Alongside the sharp fixes and hard-won judgement live inefficient shortcuts, outdated rituals, and occasional madness. Every business has some of this. Seeing it clearly lets you separate what works from what should be stripped away.
Third, build light scaffolding. Once you know what matters, give it enough structure to survive a handover. Checklists, worked examples, simple principles - devices that preserve judgement without flattening it.
Fourth, make it iterative. The real value comes when knowhow isn’t just preserved but sharpened. Each cycle of doing improves the system. Today’s fix becomes tomorrow’s baseline. A scientific loop applied to operations. That’s how resilience compounds.
The most sophisticated business systems show where this leads. Toyota’s Production System began with small efforts to make tacit factory knowhow visible and improvable. Over decades, those loops of learning compounded into one of the deepest moats in modern industry.
Danaher’s Business System followed a similar arc. Each acquisition wasn’t just new financials - it was a new contributor to a learning network. Captured practices spread across the group, but they were never static. Replication accelerated improvement; improvement deepened replication. That’s why DBS is so hard to copy. It’s not a manual, it’s a living network of knowhow.
Look at your org chart. Pick three critical roles. For each one, ask: if this person left tomorrow, what would break? If you can’t answer specifically, you don’t know where your dependencies are.
Start with one. Map what breaks. That’s your knowhow inventory. Make it visible, give it light scaffolding, make it improvable. Then move to the next.
The companies with the deepest moats didn’t build them through strategy documents. They built them by turning the knowhow that already existed into something durable and compounding.
Related: Hidden Bottleneck · What Looks Like Instinct · Reading Guide