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Eliminating Business Silos

January 31, 2014 by Dr. Jon Warner in Process Improvement

Eliminating Business Silos

The term “Business Silos” first started to be widely heard in the mid 1970’s when many organizations engaged in serious “downsizing” and significant reductions in employee headcount was experienced to be very different in one team, department or division versus another. This led to a high degree of employee and group defensiveness and a new attitude started to emerge in which “protecting the group’s turf” became far more important than ever before. A “silo mentality” is now quite widely regarded as a “mind-set” that may exist in certain teams or departments within organizations which do not wish to share resources or information with other teams in the same organization, and/or which would lead to an advantage for one team over the other. Unfortunately, this type of mentality often significantly reduces efficiency and effectiveness across the organization and may even have a negative impact on overall morale of people who can start to see the culture as becoming overly “political”. In such circumstances people then withdraw, reduce overall levels of productivity or even leave the organization.

So how do we make our organization silo free?

According to the author Patrick Lencioni, who has written extensively about business silos (and specifically in his book: “Silos, Politics and Turf Wars”), silo-free organizations need to have a compelling context for working together in cooperative ways. He says this is created by five components. These are:

1. They Create a Single or Unifying Vision for the Entire Enterprise.

Lencioni suggests that silo thinking tends to prevent any kind of unified vision of the future across the organization.  This cannot be just the CEO’s view of what the future looks like or even the most senior managers, but should be the common view of all leaders across the enterprise. There should therefore be a high level of executive “buy-in” and deep understanding of the organization’s long-term goals, department objectives, and key initiatives within the leadership team prior to passing it down to teams and individuals within them. A unified leadership team will consequently encourage trust, empower people and operate in much more collaborative ways across processes and departments. 

2. They Work Together Towards the Highest Goals.

Once all leaders have a unifying vision or set of strategic future foals for the entire enterprise, any departmental objectives can be assessed for any inconsistencies or conflicts which may exist (which may be creating something of a silo mentality). In practical terms, this means that leaders at all levels should explain the overall vision, turn it into tactics and team goals and then look for any local goals or objectives which may not be in accord with achieving the overall vision. In this way, leaders and their teams have a collaborative frame of mind which seeks to solve misalignment issues and problems at the outset and not when they have created problems or led to a silo mentality. 

3. They Seek to Motivate and Incentivize Employees to Achieve Overall Goals.

Although general motivation and incentivizing efforts are common across many organizations, to remain silo free, these efforts have to be more customized to meet the needs of specific teams and individuals. This is not to say that the rewards should be necessarily different from one team to another (in quantum terms) but should recognize that a particular team and/or individuals need different methods to motivate them to achieve the over-arching goals of the whole organization. Each leader therefore needs to establish what the best recognition approaches should ideally be and then use the most apt motivation or incentivizing methods which reward collaborative, sharing and enterprise wide goal-achieving behavior. 

4. They Focus on Positive Follow-through and Execution.

A vision and its sub-goals/objectives not only have to be widely and consistently communicated but consistently executed. Leaders should therefore work hard to allocate people and resources carefully and establish reasonable time frames for action in order to complete any common goals. And because these large-scale or enterprise-wide goals often involve complex processes which flow across departments or teams, apart from local team meetings this entails that regular coordinating meetings should take place cross-functionally. This allows leaders to talk about progress in a “big-picture” way as well as to help each other out when there are setbacks or problems or to move resources around when there is a need to do so – all acting to counter any silo thinking.

5. They Innovate and Share Knowledge Widely.

Most teams and departments will have specialized or functional knowledge in most organizations, which they may want to solidify and maintain. However, this should not be at the expense of the need to achieve the wider enterprise goals, which means sharing that knowledge freely. In other words, all teams should be open to sharing knowledge and experience with other external teams and be open to accepting new knowledge from these external teams. This creates a climate in which knowledge innovation and sharing becomes the norm and there is then no advantage created by silo thinking – the more you share knowledge the more knowledge is shared in return – a kind of virtuous circle. 

Summary

Lessening the impact of silos, where they exist, is not an easy task and may take considerable time (especially when economic times are tight and teams may feel defensive). However, the effort can pay huge dividends as the impact of silos can be extremely detrimental to individuals, departments and the organization as a whole. The steps to overcome silos may have different impacts in different environments but each one of these steps should help to break down some of the barriers and ensure that more of the employees across processes and therefore departments are “rowing the organization boat” in the same broad direction.

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About Dr. Jon Warner

Dr. Jon Warner is a prolific author, management consultant and executive coach with over 25 years experience. He has an MBA and a PhD in Organizational Psychology. Jon can be reached at OptimalJon@gmail.com

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One Comment

  1. David ToothFebruary 2, 2014 at 3:51 am

    This is a very interesting topic and I would offer a couple of observations:
    1) Silo behaviour can either be created or re-enforced by the implementation of Key Performance Indicators (KPI’s) that do not support consistent goals across different Business Units or Disciplines. Thus Senior Management should give serious consideration to purpose/structure of KPI’s across an Organisation.
    2) In an Organisation where silo’s are well entrenched, it is difficult to implement effective problem solving processes, such as Root Cause Analysis. RCA is most effective when it is ‘team based’ , with team members drawn from the most relevant areas, regardless of the existence of silos!

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Jon Warner

Jon Warner is an executive coach and management consultant and in the past has been a CEO in three very different companies. Read more

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