December 5, 2025

Institutional Knowledge why it matters

Experience matters, cutting costs requires rational choices, not promises.

Cutting experience isn’t saving money, it’s burning it.

You have to spend money to make money, and that means strategic spending, not reckless spending. So why do so many people waste money?

A concept I’ve been thinking about recently is institutional knowledge. The reason it’s been on my mind is because of AI, and some real-life experience that reminded me just how important it is, like the Amazon Web Services outage in November 2025 (I’m writing this in the past and publishing it in the future).

There’s a common trope going around that AI will save money and cut costs. People love to talk about “waste”, “They’re wasting money!” “Stop wasting money!” “We can use AI to save money!” But what strikes me is how many people ignore institutional knowledge, the kind of know-how that actually cuts corners and reduces costs overall. It’s the knowledge people build up over years. They know how things really work. That experience is something that gets passed on to junior staff.

Instead of managing budgets properly and tightening processes, a lot of industries, Hollywood and TV in particular, have focused on cutting labour costs. The lazy way out. They’ve turned full-time jobs into flexible gig work. The result? They’ve destroyed institutional knowledge. You end up with part-timers doing work that ends up costing more. Without experienced crews, studios don’t have a clear image of what they want to capture, so they film loads more footage, which costs more money. Filming overall has gotten more expensive, while the business model doesn’t match the costs. Too many big-budget productions, when what’s really needed are smaller, leaner operations. Studios have started to outsource and cut costs, but if it were me, I’d be cutting costs at the top first and making sure budgets are tighter.

The same thing is happening in the video game industry. Companies are cutting senior staff and replacing them with cheaper, less-experienced workers. The result’s the same: higher costs, lower quality, and mistakes that could’ve been avoided if someone who’d seen it all before was still around. Same story, people don’t value the labour and creativity that humans bring. Instead, they focus on buzzwords without understanding the value of anything. You can produce tons of AI-generated art, but here’s the thing: without junior jobs, nobody becomes senior, and nothing new gets produced.

All of this should be common sense, yet everyone keeps making the same mistake. It makes me think the real problem isn’t technology or workers, but management. If you actually want to save costs, you need experienced labour. But instead, we seem to only value experience when it’s cheap, and we don’t want to invest in the people who have it. Same story with actors, and with so many others.

When the boss is paid 200 times more than the lowest earner, you’ve got to wonder, is that not reckless spending? Wouldn’t it make more sense to give them less so more can be shared across everyone else? We’re stuck in a trap, really, following the herd. People say if you don’t pay massive salaries, the “talent” won’t come to you. I don’t think that’s true, but I can understand why people believe it. Which means, in the end, the only real answer is that government must act.

Anyway, that’s today’s morning musing, me, the cat, and a cup of tea. So what the hell do I know really? Yet I do wonder if smarter people have the same thoughts I do.

I know this train of thought isn’t perfectly woven together, but hopefully it gets the idea across. Institutional knowledge isn’t just nice to have, it’s the thing that keeps everything running.