Opinion Column

Silos - on the farm and in your workplace

By Larry Schruder, The Delfi Group

This week’s column carries on from our last column’s exploration of organizational structure and its importance to your business performance and success.

As I travel around the Valley countryside I see tall, sturdy, immovable silos dotting the horizon, marking the location of busy farm operations. Farm silos exist to store grains or food sources for livestock, each food stored separately until it is time to mix the unique feed formula required for each application. But silos exist other places as well – specifically in many of the organizations that we work in every day. Although you cannot reach out and touch them, these organizational silos are just as real as their name-sakes on the farm – are just as tall, just as sturdy, and often, just as difficult to move.

Organizational silos are barriers that exist between different departments or management units of a company, causing people that work for the same employer to become uncooperative, obstructionist, unhelpful, and sometimes even to work against one another. This can be labelled organizational politics, departmental rivalry, or turf warfare – but it all manifests the silo mentality of independence, disconnectedness and lack of big-picture thinking.

Organizational function or expertise silos are artifacts from the past, when information was scarce and had to be centralized for ease of access. They were formed at a time when the need for cross-functional connectedness was low. Each team of experts had a unique and non-over-lapping role to play on the end product – and then stepped aside to allow the next team to take over. But times have changed, making this old artifact no longer appropriate to the business of today

In today’s business world, this old organizational mindset most often develops into a silo mentality – when each group or department no longer shares information with other groups – and finger-pointing becomes the common answer to the question “what went wrong.” When employees interact poorly with people outside of their silo, it becomes difficult to do the work of the business. A tight-knit department that works well together can be a plus for a business. However, organizational silos can be like fortresses within a company and eventually cause serious problems that might not be noticed until the damage is done.

Organizational silos usually are resistant to change, operating to prevent easy access to the information they hold and throwing up barriers to change and co-operation. Silos make it difficult for communication and collaboration to occur across units. Each group works to protect its own interests. One unit might not tell another unit that customers are complaining about packaging, preventing the company from responding effectively to customer concerns. Groups might neglect to share information with owners and managers. Some silos use different forms and processes for the same business function or prepare similar reports without sharing or combining data. Organizational silos cause redundancy and poor decision-making and stifle creativity and innovation.

Some of the common organizational silo pressures today are sales vs. marketing; sales vs. production or manufacturing; production vs. design; accounts receivable vs. customer service; human resources vs. line management; purchasing vs. inventory control; management vs. union; salaried vs. hourly; plant vs. head office. And there is plenty of room for more than one of these dysfunctional relationships to be present in any one organization. You can quickly get a picture of a very fractious workplace with internal teams struggling against each other in an honest attempt to contribute its best to success in a complicated business world.

Although silos can be found in any size organization we can say the larger the organization the more fertile the environment for the germination and establishment of deep silo roots. Our typical complex organization charts are really no different that the farm pictures above – tall sturdy structures that have little reason to over-lap. Such structures quickly develop a culture and view of the world that is unique to their silo, even though they are all part of the same company.

Silos can form when employees develop more loyalty to their own group than to their employer. As silos solidify, members become more insular and distrustful of other employees or departments. Once trust disappears, it becomes increasingly difficult for groups to work together. Silos need the strong support of local management to thrive and flourish - and many managers fall to the temptation of trying to make a name for themselve by being the best manager possible by building the strongest functional unit possible. And the bigger-picture pain begins.

Lack of trust among team players is a fundamental reason why teams do not reach their full potential. Lack of communication and interaction with each other makes the development of trust between members of different silos very difficult. Silos belong on the farm where they serve a useful purpose. Within organizations, they are an artifact of the past that are as destructive to success as boulders are on the airplane runway. Allowed to exist without challenge, they make it very difficult for true organization-wide teamwork to develop - which is a critical element for success in today’s competitive marketplace.

Next column we will explore some ways to begin to break down such silos and eliminate their negative effects in YOUR workplace.

Larry Schruder is president and co-owner of The Delfi Group, Pembroke and can be reached at larry.schruder@thedelfigroup.com .