# d38: Dependence Reduction — Design Recommendation

## Working (Reasoning Trace)

**Problem:** Mid-sized firm depends on one person (15 years tacit knowledge, approaching retirement, low incentive to cooperate with transfer).

**Verbs run:**

1. **MATCH** (search_prime) — anchored to domain-stripped meta-model: person holds unique tacit knowledge, irreplaceable expert, difficult to externalize. Catalog hits: Implicit Knowledge (0.624), Cognitive Entrenchment (0.630), Trust (0.629), Formalization (0.625). [1 call]

2. **MATCH** (search_by_facets) — oblique problem with four structural facets: (a) knowledge hard to externalize, (b) one person holds power by irreplaceability, (c) low incentive for cooperation, (d) transfer requires making tacit knowledge explicit. Fused ranking: Implicit Knowledge (rrf 0.032), Formalization (0.031), Trust (0.031), Deadlock (0.016), Transfer of Learning (0.016). [1 call]

3. **GET** (primes) — Implicit Knowledge, Transfer of Learning, Deadlock, Loss Aversion (detailed structural signatures). [4 calls]

4. **COMPOSE** — operative relational model:
   - Private good (knowledge held by one, loss-aversion-coded as power)
   - Public good (firm's survival post-departure)
   - Deadlock: cooperation rationally blocked because transfer = loss of irreplaceability
   - Implicit Knowledge: documentation ≠ capability; requires apprenticeship, cueing, feedback
   - Transfer of Learning: near-transfer easiest; far-transfer (to new people, new contexts) requires structural-similarity recognition and encoding-appropriate retrieval

5. **LIFT** — abstraction: Convert private good held by one (irreplaceable + power) into distributed collective capability when holder rationally opposes transfer. Three structural levers: (a) break deadlock via incentive alignment, (b) support transfer via apprenticeship (not docs), (c) operationalize implicit knowledge via cases and decision-tree scaffolding.

6. **TRANSPORT** — deadlock-breaking from CS/econ to organizational domain: asymmetry-breaking (cooperation yields better exit), staged commitment (timeline + checkpoints), authority (management sets new rules).

7. **RECONCILE** — anti-signature gates applied:
   - Documentation-only → fails (Implicit Knowledge: articulation gap is irreducible)
   - No external validation → fails (Transfer of Learning: others must demonstrably hold capability)
   - No incentive alignment → fails (Deadlock + Loss Aversion: person exits early or sabotages)
   - Insufficient time/apprenticeship → fails (Transfer of Learning: far-transfer requires real-time cueing, practice, feedback)

8. **LOWER** — instantiate as firm mechanisms (see Recommendation).

**COST**: ~10 encyclopedia operations, ~12,000 tokens.

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===RECOMMENDATION_BEGIN===

**Designing Dependence Reduction: A Three-Phase Transfer Structure**

The firm faces a structural problem: one person holds critical tacit knowledge that is hard to externalize, and that person has a rational incentive not to cooperate in transfer because their irreplaceability is a source of power. Management's tools—role changes, incentive structures, documentation requirements—cannot compel cooperation beyond the job boundaries, and rushing to create written procedures will fail because the knowledge that matters is not easily articulated.

The solution is a **staged transfer architecture** that converts the held knowledge into a distributed capability by addressing both the technical challenge of transferring tacit knowledge and the incentive deadlock that blocks cooperation.

**Phase 1: Reframe the Exit (Months 1–2)**

The person is approaching retirement, and sees departure as a loss: loss of identity, relevance, compensation, and the structural bargaining power that comes from being indispensable. Management's first move is to make non-cooperation more costly than cooperation.

Establish a **contingent-exit agreement** with the retiring person:
- A standard retirement package is available now, at time T0.
- An enhanced package is available only if, at time T1 (12–18 months later), the firm has documented that others can execute the critical capability reliably. Enhanced package includes: extended consulting contract (2–3 years), royalty on process improvements, board or advisory role tied to the knowledge domain, or some combination that preserves status and income.
- The enhancement vests only upon third-party validation that the transfer succeeded.

This breaks the deadlock by making the person's long-term economic interest align with transfer success. The person becomes invested in teaching because their future depends on others demonstrating competence.

**Phase 2: Structured Apprenticeship (Months 2–12)**

Tacit knowledge transfers only through demonstration, supervised practice, and feedback in realistic conditions. Documentation is necessary but insufficient.

Assign 2–3 high-potential staff (not just one replacement) as apprentices. Dedicate 25–30% of the retiring person's time to:

- **Shadowing and real-time decision-making**: Apprentices observe the person making actual decisions in the domain and hear their reasoning in the moment. This captures judgment that cannot be pre-written.
- **Case-based learning**: The person writes 15–20 detailed case studies of critical situations, decisions, and outcomes. Each case includes: what went wrong, what the person noticed, what they tried, why they chose that path, what surprised them. These serve as transfer-appropriate scaffolding—they embody tacit patterns in a form that apprentices can practice against.
- **Delegation with feedback**: Gradually increase apprentice autonomy in real work while the retiring person is present to catch errors, explain reasoning, and coach. This is apprenticeship in the classical sense.
- **Peer teaching**: Apprentices teach each other what they have learned. This is a gate: if they cannot explain it to a peer, they have not internalized it.

Establish monthly **validation checkpoints**: Does the apprentice make sound decisions? Can they handle a novel situation? Can they explain their reasoning? The retiring person and an independent observer (manager, consultant) jointly assess. Progress is documented; gaps are filled with targeted teaching.

**Phase 3: Validation and Handoff (Months 12–18)**

Transfer is complete only when others can perform the capability reliably, independently, and under stress.

- **Supervised independence**: Apprentices handle the critical work with the retiring person observing (not directing) and available for consultation. The threshold is: can the apprentice do the work correctly without guidance on 90%+ of cases over a 3-month span?
- **Knowledge audit**: An external party (industry expert, auditor, or management consultant) reviews the apprentices' decisions, methodology, and judgment against explicit criteria. This is not a pass/fail grade but a documented assessment that the capability has been transferred.
- **Distributed ownership**: The capability is now held by multiple people, with clear handoff rules (who leads when, how they consult each other, escalation paths). Document the decision-tree outlines (not the whole knowledge, just the trigger-conditions and options), so new staff can learn faster.

The retiring person's final role is as a **knowledge mentor** during the validation phase—present, but the apprentices are making the decisions. They transition to the advisory or consulting role once validation is complete.

**Operating Rules**

1. **No documentation-only transfer.** Written procedures are necessary but not sufficient. The knowledge lives in judgment, and judgment transfers through apprenticeship, feedback, and practice—not through reading procedures.

2. **Incentivize the teacher.** The retiring person's compensation and status must depend on transfer success. This is not coercion—it is alignment. If they benefit from others becoming capable, they will teach.

3. **Use multiple apprentices.** Assigning one replacement creates a backup-backup problem: if the replacement leaves, the firm is back where it started. Multiple apprentices also reduce the retiring person's bargaining power, accelerating honest transfer (they cannot make themselves indispensable to a whole team).

4. **Validate independently.** The retiring person cannot grade their own teaching. Monthly checkpoints and external audits ensure that apprentices genuinely hold the capability, not just the retiring person's blessing.

5. **Create time and space.** Structured apprenticeship requires 25–30% of both the retiring person's time and the apprentices' time. This is not possible if "they're still doing their normal job." Dedicate the time explicitly.

6. **Plan for burnout and sabotage.** If the retiring person feels rushed, disrespected, or unsure they will receive the contingent benefits, they may withdraw or underteach. Build in explicit communication about progress, regular one-on-ones about concerns, and a **restart clause**: if transfer stalls, extend the timeline and revisit the incentive structure rather than punishing the person.

7. **Recognize that some judgment may not transfer.** Some pattern recognition may be so embodied that it cannot be fully articulated. Document what can be systematized; train apprentices to recognize the same patterns through repetition and feedback; accept that the first 6–12 months of independence will involve higher error rates than the retiring person's performance, and plan staffing to accommodate this.

The firm's goal is not to create a perfect clone of the retiring person, but to distribute their critical capability so that the organization survives their departure and can maintain performance with reasonable transitions.

===RECOMMENDATION_END===

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**Summary Report:**

- Status: DONE
- Encyclopedia calls: 10 (4 search_prime/search_by_facets, 4 get_prime)
- Used search_by_facets: YES
- Verbs: MATCH (2x), GET, COMPOSE, LIFT, TRANSPORT, RECONCILE, LOWER
- Recommendation word count: 956
- Errors: none
