If you’ve ever seen a silo on a farm, you understand the image of silo mentality. A silo is a tall, structure with no windows, designed to store grain. Difficult to access since the grain is deposited and withdrawn via machinery, and there are few very limited points of entrance.
Silos are essential to keep grain protected on a farm, however the silo mentality crops up too often in business. Departments store--even hoard--information, leaving it inaccessible to the rest of the company. And resistance to share information benefits no one.
In business the silo mentality is characterised by individuals or divisions that withhold information from others in the organization for various reasons, which might include power struggles, fear, organizational inefficiency, or simply because they don’t take the effort to update shared information.
Silo mentality destroys trust, cuts off communications, and fosters complacency. A siloed organization can’t act quickly or take advantage of opportunities. When information isn’t freely shared, your business can’t make informed, data-driven decisions. Inventory, supply chain, distribution, marketing, and sales suffer when teams don’t collaborate.
One study revealed that 70% of customer experience professionals and executives view silo mentality as the biggest obstacle to customer service. Breaking down that resistance saves money and makes it possible to meet company goals.
Cooperation, communication, and collaboration are the three keys to working across silos. Several effective strategies can help a company break down the silo mentality and improve these traits across divisions and geographical areas.
Silo mentality begins with management. Often, divisions within an organization set goals that benefit their department but conflict with the goals of another. Each manager is focused on accomplishing their specific goals, and that focus frequently incentivizes siloed information and creates resistance to sharing it across teams.
In order to break down the silo mentality, department managers must have the vision that a free-flow of information will help the entire organization.
Some companies have established customer experience councils, others have established a company vision or goal. As the managers of different silos focus on the unified vision, the objectives they establish for their divisions shift from the silo objectives to support that unified vision.
The leadership team must buy in and understand the company’s long term goals, department objectives, and key initiatives before passing the unified vision down to the teams. The unified leadership team will encourage trust, create empowerment, and break managers out of the “my department” mentality and into the “our organization” mentality.
A common problem of silo mentality is that people see things from their perspective and they are likely to make choices that protect their department rather than protecting the company as a whole. To combat this challenge, each person in the organization needs to work toward common goals. When people across the company have the same objectives, they are more likely to communicate better.
Executives need to state these common objectives frequently so they become part of the organization’s culture. Each department’s division-specific goals should reflect the overall goals of the company. Working together breaks down barriers to cooperation, communication, and collaboration
Your company may already hold collaboration tools in the form of its CRM (Customer Relationship Management) software. CRM dashboards allow the entire company to see sales and progress towards goals. When companies give their employees the quality collaboration tools, people will share information and work more efficiently toward the common goals.
Part of sharing information across silos is sharing specific pain points and motivators. Beyond Philosophy cites Paul O’Neill’s turnaround of Alcoa in the 80’s in using a common goal of safety to get unions and managers communicating and cooperating to improve efficiency and quality. They observed that rules the unions had opposed for decades – such as measuring productivity of individual workers – were suddenly embraced, because they exposed safety hazards. Similarly, policies that managers had long resisted – such as allowing workers to shut down a production line – were now welcomed because that was the best way to stop injuries before they occurred. When the entire organization seeks to understand each individual department and the specific issue they face, departmental goals can become the goals of the entire company.
One way to break down silos is to educate, work, and train together in cross departmental exercises. Because companies already figure training costs into their budgets, collaborative training across divisions is a way to dovetail required training with collaborative, silo-breaking practices.
In addition to collaborative training, the silo mentality can also be eradicated through inter-company interactions. Melissa Agnes, a crisis management strategist, recommends holding a town hall to point out the dangers of silo mentality and outlining the plan to change the corporate culture to increase cooperation, communication, and collaboration.
Agnes says that some organizations naturally conduct cross departmental team building exercises; but a company that puts team building exercises at the discretion of managers for small groups might want to consider shifting these to be cross-departmental.
Agnes also suggests physically moving people if it is feasible. When people work near one another, they build rapport and relationships. Proximity builds understanding. Then, as problems arise, teams look to each other for suggestions.
Two groups that don’t always collaborate as they should, sales and marketing, would greatly benefit from collaboration. Mark Scrivner, founder and CEO of ECOS, a cloud-based, digital presentation platform that helping bridge the gap between sales and marketing, explains, “When sales and marketing don’t act as a cohesive unit, projects can take three to four times as long as they should. This results in an immediate loss of sales activity and decreased revenue.” Scrivner even suggests sales and marketing swapping jobs for a time: “This could be as short-term as having marketers sit in on one of your team member’s calls or as long-term as reassigning your sales members to marketing teams to get a feel for the role,” he explains.
Every company may not be able to apply all of Agnes’ or Scrivner’s suggestions; but incorporating at least one can display leadership commitment to improving cooperation, communication, and collaboration.
Granted, division in a company is necessary to complete all the responsibilities. In a sense, this division of labor is a silo. According to Neil Smith and Patricia O’Connell, though, the goal is not to destroy silos themselves but to eliminate resistance to share information. Managers may think that getting rid of silos is the answer, but the structure that silos bring is very important organizationally. They talk about the importance of communicating often.
Some companies have established customer experience councils. One of these was Maersk, a container shipping company. The councils included 3-day training on customer experience that included managers of all the different functions within a region, and then they met monthly to decide which initiatives to implement. Maersk saw 40% improvement in their net promoter score, a metric used to gauge the loyalty of a firm's customer relationships.
In fostering collaboration among the different teams such as sales, operations, legal, finance, internal audit, sales, and marketing, organizations will be able to make better-informed decisions, serve customers better, and ultimately, increase sales.
With motivation varying across teams and individuals, it is critical to find the best way to get everyone working together toward a common vision. To emphasize the unified goal, companies will need to evaluate compensation plans. If the compensation is designed to support siloed goals, the unified vision will not get buy-in from employees.
Compensation should reflect the goals that everyone should be working to accomplish, and each person will be motivated to focus on those goals. People will be motivated to collaborate, to communicate, and to cooperate when their take home pay gets involved.
Sometimes, resistance to share information from others in the organization occurs due to organizational inefficiency or simply because people don’t take the effort to update shared information. A way to increase team collaboration would be by providing useful collaboration tools.
Mark Scrivner says one way to reduce the silo mentality is to use technology to your advantage, and use programs and tools that exist to help the teams work together. For example, he says, a current problem might be that the sales team and marketing have different information about a customer. He advises deploying a tool that will comprehensively integrate customer information, enabling both teams with a new source of information as the glue that holds them together.
A good CRM should integrate well with a variety of apps that make it easy for employees to collaborate. Each team has respective functions that they need to accomplish therefore they use certain apps tailored for their needs, however if you can integrate those multiple apps with the CRM, then collaboration tools are working with the company to break down silos.
When businesses can correlate information within the company, the entire company benefits. Consider, for instance, a large retailer who shares a free-flow of information on inventory, customer service interactions, internal costs, and shipping. Potential problems can be avoided and customer service and satisfaction improved.
Effective strategies that break down the silo mentality include creating a unified vision, working toward common goals, cross-department education, work, and training, communicating often; evaluating compensation plans, and implementing a CRM.
A unified vision of company goals will turn damaging silo mentality into a culture where there is division of labor but not division of information.
The best way to get to know Sales Cloud is to get your hands on the actual product. The free trial also comes with unlimited access to our Sales Community, a group of sales thought leaders sharing ideas about sales for salespeople.
Questions? Our reps have answers. 1-800-667-6389