For almost 30 years, consultants pushed a simple and credible idea – that silos are bad and need to be broken. This orthodoxy is rarely challenged, yet a third of a century later silos still exist.
Is the focus on breaking organizational silos really the right answer? Or does it require a different approach that focuses on data instead?
In the early 1980’s, Jack Welch was CEO of General Electric (GE) – a company that was widely accepted to be inefficient and overly bureaucratic. He embarked on fundamental reforms of how GE did business internally and became the standard bearer for the ‘boundary-less organization’. Welch’s argument was organizational silos are barriers within businesses which lead to inefficiency. As his mantra took hold, consultants and experts began to talk of the need to break silos in an increasingly zealous way.
However, it’s questionable whether this ‘one size fits all’ approach which focuses on silos of people really solves what is a more fundamental problem – the lack of a seamless flow of data across the business.
Keep the silos – break the data silo
In our data-focused environment, it’s data silos, rather than organizational silos, that make businesses inefficient. Writing in the Harvard Business Review , Ed Wilder James argued the focus needs to move away from organizational silos as “there is a bigger and costlier demon that lurks in enterprises. A demon that … often makes initiatives impossible: data silos”.
The reality is that any business which is unable to make data-driven decisions based on high quality data will lose its competitive advantage. Ultimately, it’s the data silos that reinforce the barriers to information flow, which management need to smash.
The lazy mantra of ‘break the silo’ can actually damage some of the most useful structures that evolve in your business. So, how do businesses create a real strategy based on data convergence? Here’s a checklist of the key areas to look out for when planning your convergence strategy.
Understanding the silos
Understanding how silos operate can be difficult, especially in businesses with an indistinct internal structure. Recognizing that each skill group has its own way of working is the first step towards understanding them.
But how can we promote reuse of data if we do not have a view of who is using what? Unless we connect the data flow to its business usage, data will remain siloed and the firm’s overall effectiveness to create a more coherent and higher quality data asset hampered.
Filling the gaps
To ensure data flow is flawless, it’s not just the system that matters. Everything has to work together like a well-oiled engine – that requires all the parts to be in perfect working order.
The key areas to look out for are gaps in:
- Skills – there will not be a free flow of information if employees don’t have the appropriate skill sets to collect, enter and analyze data. Training in these areas needs to happen before the implementation of any new system.
- Data – incomplete data sets are an ongoing issue across industries. Data can’t be made actionable or effectively analyzed if it’s irrelevant and outdated.
- Legacy systems – data can easily become trapped in legacy systems. It’s imperative data is extracted and moved into a format that can be used within any new system, before the new system is put in place.
- Processes – all processes should be set up to ensure consistency of data and data flow. Data needs to be harmonized across the business as does the organization’s data governance framework.
- Technology – issues in this area cause a range of problems. For example, employees may not receive up-to-date information at the right moment. This may cause consequential issues such as execution fragmentation and marketing messages arriving out of sync or at inopportune times.
Finding the right partner
The hunt for the perfect partner that shares your vision is never easy. It is likely businesses partner with several different organizations. It’s important to share a vision and working.
Additionally, you will have chosen several platform providers. To ensure you achieve true convergence, it’s vital any new element is completely interoperable with your existing elements. Without that, you risk setting up de facto data silos and isolating legacy systems within the organization.