I previously wrote how creativity, invention and knowledge are the key ingredients for innovation. Innovation thrives in environments that nurture new ideas, creativity and sharing as it is built on existing ideas, knowledge and inventions. As a system, innovation is collaborative, multidisciplinary and requires diverging viewpoints and experiences. It is also inclusive, and it is about bridging and extending linkages and interactions to build something that is greater than its parts.

On the other hand, organizational silos are barriers to innovation. As the name represents, they are highly-vertical, where the communication and collaboration outside of the organization is at best minimal. It seems, as a business matures, it becomes impossible to avoid becoming a victim of a silo mentality. This is mainly due to the nature of business and people: the essence of success strives to keep order and maintain the status-quo that created it in the first place. With that, it is a challenge and a requirement for businesses to reinvent themselves, as recently demonstrated by the Yahoo Memo: The ‘Peanut Butter Manifesto.

Organizational silos come in different shapes and sizes. Some are obvious as they bring out the worst in people: us vs. them attitude, playing schedule chicken, finger pointing, CYA (cover your a**) syndrome, political turf fighting, and power struggles are all common examples where the situation eventually leads to attrition of good people. Hopefully this does not describe your current workplace, however you have probably experienced some of the other types of organizational silos.

• Geographical silos — Globalization increases the urgency to break down geographical silos. Lack of customer information and understanding, disconnected systems, and inconsistent hand-offs between teams in different geographical locations often result in missed opportunities, unhappy customers and waste as everything gets duplicated at all locations.
• Functional silos — These tend to surface between departments where the authority rests with the functional managers, such as marketing, sales, R&D, etc. Although R&D and Marketing collaboration problems are frequently noted, you can experience silos forming within the same department where there are differing types of functional responsibilities. The QA team feeling like a 2nd class citizen compared to developers, or the usability team not feeling listened to are common complaints.
• Organizational silos — Organizational silos usually occur between business units. As a customer, we are the ultimate losers and we feel the impacts of the firm’s disfunction the most. Usually in the form of products that lack interoperability, different customer experiences, purchasing processes, usability, … Basically a lack of company brand.
• Project silos — Lack of best-practice sharing and the inexistence of organizational level project management processes and standards result in project silos. On the surface this might seem innocent, yet it results in inaccurate and inconsistent project status reports with major challenges for implementing an effective portfolio management process, not to mention lack of quality, usability and delayed project releases due to difficulty of managing resources and budgets between projects. This is why there is an increase in PMO (Project Management Office) creation and centralization of project management activities.
• Technology silos — Usually driven by NIH (not invented here) syndrome, needless technology silos result in interoperability issues between products from the same organization, wasted development and testing efforts, increased development costs and increased time to market.

In summary, organizational silos are bad for innovation, bad for the organization and bad for the firm. Fortunately, the symptoms of the illness caused by organizational silos are pretty obvious. So, you know you have a silo problem when:

• You cannot share knowledge or information for developing new ideas or resolving problems;
• You are sure that any information about your firm’s customers, markets or competitors is classified as top secret;
• You gave up on any hope of leveraging and building on your firm’s existing assets, such as IT infrastructure, manufacturing, operations for new ideas and products;
• For every forward step you take, you seem to take 2 steps back and you see its impact in decelerated cycle time of new product introductions;
• You have a culture that values personal expertise and knowledge creation over teamwork;
• Deja vu is your middle name. You feel like you are stuck in the twilight zone, wondering why the history repeats itself, and if you will ever escape;
• You are stuck with bureaucracy and endless pointless meetings even over simple problems, and you are certain that having a root canal would be less painful than this;
• You are stuck in a cycle of incremental improvements and about to suffocate as you are trapped in the confines of the capabilities of your organization;
• Everyone seems to completely lack awareness of who does what in the organization, resulting in duplication of efforts and more needless waste;
• You are convinced they were thinking of your organization when they defined brain drain;

Silos are generally the result of organizational structures, senior-management priorities and values, and the culture that is created through the existing reward system. Using a 5-prong approach, you can break through the silo mentality and bring down the walls.

Emphasise the appropriate values

Trust, respect, honesty, communication and collaboration are the needed values to build your organizational culture around. As you shift from top-down driven organizational dynamics, you need to promote values that will enhance your organizations communication and collaboration capability and enable your teams to resolve conflict and improve their decision making capability at their level.

Build a culture of collaboration

Cultural changes need to start at the top: leaders will need to consistently and constantly communicate and demonstrate the importance of sharing, leveraging and collaborating across the organizational silos. Certainly the reward system can kick start the needed transformation by focusing on making collaborative performance objectives part of the employee review process. Recognition of people who work across the organizational boundaries will also reduce the emphasis on individual achievement, and shift the focus to collaboration.

However, building a culture of collaboration is more than just encouraging better communication and sharing. It is focused on creating value by effectively and efficiently utilizing the available assets (knowledge, people, tools, …) and bridging the gaps regardless of job title, functional expertise or organizational belonging. This requires not only a sense of shared purpose, but also a greater understanding of how everyone contributes to the organization’s success. To create that understanding, invest in job rotations and international assignments, utilize cross-functional teams and invite others from different areas to your meetings.

Rally around a shared purpose

Rather than top-down direction setting, build a sense of shared vision and purpose, personal accountability and empowerment throughout the organization. Shared purpose allows everyone to connect to an idea that is bigger than them, and allows them to see how their day-to-day activities contribute to the bigger goal.

To further the cause, bring systems thinking to your organization by integrating your departments, and building in collaboration by utilizing cross-functional teams, ignoring org charts and focusing on innovation and customers. With that, increase the transparency in your organization, openly communicate decisions, priorities, financial challenges, competitive pressures, and strategic initiatives to all.

Make it easy to connect and share

Lets face it, developers are not the most outgoing kind, but they are curious and usually hungry. And, there are ample opportunities to connect and share. So, look at ways to bring people together in your firm through idea exchange days, open house days, best practices exchanges, internal seminars, brown bag discussions. But don’t stop there, find ways to extend your collaboration network outside of your firm by bringing speakers and scientists, tap into your customers and suppliers.

Also, utilize collaboration technology and social networks to connect your project members, experts, hobbyists, early adopters and visionaries. Make these tools and communities work for you.

Focus on the important stuff and measure accordingly

As I mentioned before, what gets measured gets done. So, focus on the important stuff like your customers and innovation. This further encourages cross-pollination of ideas and collaboration. Furthermore, set aggressive goals that require collaboration, such as the case with P&G where they expect 50% of the company’s new products to come from outside the P&G labs. This requires building a network of outside innovators, scientists, customers and suppliers to tap into new ideas and develop new products.

Also revisit your brand identity and make sure it emphasizes working-togetherness and having one-voice. The standardization of your brand image will not only improve your relationship with your customers, but will further promote a sense of one company, one organization and one team.

There is a right time for everything, including building silos

Though silos are bad, there are times when you do need them, but more clearly what they represent: an enclosed structure and/or a protective shelter.

• Prevent technology and idea contamination in situations where your competitor also becomes your partner. This is more common than you may think, especially in large organizations. It is crucial to limit interaction between your product development teams and teams that are working closely with your competitor to avoid any potential contaminations and lawsuits. It is also a good business behavior.
• Cultivating a new business within a mature organization requires tender care and protection from the big corporate mentality and culture.
• M&A process highlights the tension between staying in full compliance with government rules governing mergers and acquisitions, yet accelerating the integration process as the M&A finalizes. Utilizing the clean room concept, you can gather and analyze sensitive information from both companies, and in turn support the merger teams and accelerate the integration process.

These are certainly valid cases for building a silo and limiting communication to the outside world. However, in your organization, it is still important to maintain an awareness of why, what and how-long this silo will last. Basically, be transparent within a reason.

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