What Is An Organizational Silo?
If you're agriculturally minded, you'll know that silos are vast, cylindrical storage tanks traditionally used on farms to store grain or fermented feed. Their purpose is to keep the contents of the silo separate from other vital farm assets. This is positive as farm silos promote efficiency, reduce waste, and maximize profits.
In the corporate world, however, silos in organizations have more negative connotations as they separate individual teams from the rest of the business. These self-contained teams operate independently and focus on their own objectives rather than the company's broader mission.
The result? Some 40% of company employees report they don't feel adequately supported by colleagues in different departments who "have their own agendas."
Types Of Silos
Multiple varieties of silos can exist within an organizational culture, including:
When a segment of your business has its own tools, processes, or language and doesn't effectively share this knowledge outside the silo.
Knowledge exchanges may become "stuck" in individual channels. For example, if a crucial conversation happens in a private Slack group that other team members can't access.
Regional offices may compete against each other, even though they belong to the same organization. More recently, adverse silo effects have emerged in office-based, remote, and hybrid workplaces when employees club together based on location or environmental factors.
Management teams may form their own leadership silo that prevents vital company information from trickling down the ranks to entry-level employees.
Merger And Acquisition (M&A) Silos
When an influx of employees arrive at a newly blended organization, it's easy to develop an "us" and "them" silo mentality.
Shift workers with the same schedules can operate independently from those clocking in later in the day.
Why Do Organizational Silos Exist?
Some experts will argue that a siloed organization is entirely natural. Employees will always be drawn towards working with people they share similarities with or those with the same team goals. As co-author of The Harvard Business Review Leader's Handbook, Ron Ashkenas says, "Working in silos is more natural than working collaboratively. It's a tribal mentality."
There's also a use case for actively encouraging organizational silos in projects that only require the input of a single team. Inviting communication and collaboration from outside parties can create a case of "too many cooks in the kitchen." Too many voices can negatively impact a team's function and slow project momentum.
But not all silos are deliberate, and they often come down to a lack of strategic planning. Silos can take root in poorly managed companies, which is a problem when knowledge transfer stalls between these entities.
Some of the top reasons why there are silos in organizations include:
Failures In Leadership
Leaders must continuously share their company's vision as a constant reminder of how each team's work fits into the bigger picture. Employees may become inward-looking and isolated when leaders don't clarify the desired outcome.
Bill Crim, CEO of United Way of Salt Lake, explains, "In complex organizations, you need some way to keep everybody on the same page. When you let silos develop because there’s no organization-wide view into what’s going on, that’s the worst possible way of working."
Operational silos can develop if companies don't build organizational structures that encourage internal collaboration. For example, a non-silo company might use formal systems like the RACI matrix to enhance communication across teams by defining who is Responsible, Accountable, Consulted, and Informed at each stage of a project or workflow.
Without such a system, expect to see poorly designed reporting lines or communication bottlenecks.
35% of companies expect onboarding to happen organically without investing a single dollar. When this happens, new hires often feel disoriented if they join a company and don't receive the tools they need to fit in.
Joiners must rely on their teammates to share their knowledge but may find it challenging to gain insight into the rest of the organization. As the team grows, the cycle continues, with the walls around the silo getting higher.
High-performance organizations encourage healthy competition to foster innovation and creativity. And if the entire company collaborates to position itself as a marketplace leader, this is an excellent use of competitive spirit.
But silos form if employees focus on internal rivalries with adjacent teams rather than uniting to beat external competitors.
What Happens When Departmental Silos Form?
Departmental silos create some common frustrations that many employees and leaders are already familiar with.
1. Duplicate Work
Expect some overlaps when teams operate in a silo and lack awareness of what the other departments are doing.
Example: Payroll and HR teams can easily duplicate some of their organization processes if they don’t share the same database.
2. Departmental Misalignment
Teams can't plan strategically or coordinate to hit shared objectives when they don't communicate or understand each other.
Example: Marketing and sales departments want to achieve the overall goal of increasing sales conversions. But if the marketing team doesn't check that their qualified leads have the budget to proceed with a purchase, this can lead to frustrating prospect calls for the sales team.
3. Loss Of Company Vision
When teams get too immersed in their processes, they may lose sight of how their work contributes to larger company goals.
Example: Your product development team might be focused on hitting their project deadline but don't consider that rushing could produce a negative customer experience.
4. Communication Problems
When teams don't discuss their work regularly, there are more chances of miscommunication and fewer opportunities to prepare for the next stage.
Example: If the customer success team isn’t aware of a new product launch, they may not be ready to handle an influx of customers.
5. Lost Revenue
When customer experience operations happen in silos, these inefficiencies and lack of communication cost money.
How Do You Spot Organizational Silos?
You're probably wondering if your organization is filled with antisocial silos that don't want to cooperate with the rest of your teams. The great news is that it's easy to spot these outliers if you look for the following indicators:
Perhaps the most obvious sign of silos is when departments are in open conflict. Unless your organization has a bottomless budget, this often happens if teams must compete for limited resources, including additional headcount for their department.
This tug of war can lead to bitterness—a one-way street to disengagement if one siloed team feels that the company doesn't value its contribution.
Negative Customer Experience
Negative customer ratings are an enormous hint that things aren’t working well behind the scenes. The ROI of Uniting Unified Communications and Contact Center reports that siloed contact center agents spend 15% of their day attempting to overcome communication hurdles to resolve customer queries.
If your data tells a similarly frustrating story, you may have knowledge gaps between departmental silos impacting your front-line workers.
If your sales teams are promising one thing, but your social media posts and blog copy says another, it's time to unite your teams and revisit your messaging.
Companies with successful onboarding programs ensure that new joiners ramp up to become productive and loyal to their new company over three months. But onboarding into a silo could take far longer.
Onboarding or regular pulse surveys focus on employee experience and provide clues about how new hires view team cohesion. These survey results will highlight if communication issues are impacting their settling-in period.
When your teams have neither the time nor the inclination to get to know each other, you might notice they don't know each other on a first-name basis. Knowing a person's name is a basic courtesy and a mark of respect. It's also an essential first step in bridging gaps between silos.
An easy way to break those walls down is to try a simple team-building game to learn names in a group juggle.
10 Strategies To Reduce Organizational Silos
Don’t panic if you’ve identified departmental silos in your company because we’ve got ten stellar strategies to bring your isolated teams back into the fold. Try them out to create a network of interlocking units with excellent communication skills.
1. Stymie Silos Before They Start
81% of HR and DEI practitioners believe diversity, equity, and inclusion initiatives benefit their companies. And Jessica Arias, Director of People & Culture at OnPay Payroll Services, agrees that encouraging employees to bring their whole selves to work will block silos from forming in the first place. She tells us:
“Avoid silos by staying on top of diversity, equity, and inclusion (DEI) initiatives. Not only do they foster an environment where individuals feel comfortable being themselves, but they also fuel collaboration across an entire organization, encouraging individual departments to work together and reach—or exceed—goals as a team. By creating a culture in which employees feel comfortable expressing themselves, departmental silos will naturally crumble (or prevent them from taking shape altogether) to ensure all voices are heard and elevated.”
2. Open Up Communication With Internal Discussion Boards
Communication in the workplace relies on a positive flow of information across all departments and ranks to avoid the frustrating cry of "No one told me." Companies must pay as much attention to internal conversations as to customer or business partner communications, but this will require buy-in from your leadership teams.
“Communication needs to be a two-way street, with management and staff equally involved, not just one taking orders from the other. To break down these silos and get teams comfortable with open communication, creating an internal discussion board could be a great stepping stone. For starters, all the interactions take place virtually, so even remote and hybrid team members can take part. And second, you can build these forums interactively and even create a reward system that motivates employees to participate in important discussions."
3. Encourage Cross-Departmental Communication
Knowledge hoarding is a common problem when departments don’t talk to each other, which is why companies need a cohesive strategy to keep everyone on the same page.
“Silos can form when teams work on projects in isolation. Perhaps this quarter’s sales forecasts are low, and your sales team wants to develop new tactics to close deals more frequently. To do so, they’ll need insights from your marketing division to better understand the market they’re targeting. If they go without, their approach could lack nuance or accuracy. This practice is damaging from an operational perspective, as this can allocate internal resources toward costly and ineffective initiatives.
To keep departments connected, HR leaders must protect information flow and foster collaboration as a matter of priority. We’ve seen success by creating tailored channels on platforms like Slack; think separate groups for “Sales and HR” or “Finance and Marketing.”
4. Over-Communicate For Clarity
Overcommunication means you can never repeat a vital message too many times. It's better to be repetitive than risk your team not hearing what you have to say. This also ties in with the theory of "spaced repetition," where people are more likely to remember and understand your message when they hear it multiple times at intervals.
“Over-communicating is easy to do and yields immediate benefits. I have done this successfully by copying at least one decision-maker from each team or department on important emails and requesting that they do the same. Over-communicating in this way will help spread information across the organization and allow others to provide their perspective or feedback. This is a quick and fast way to break down silos and improve communication flow.”
5. Foster Interpersonal Connections Between Employees
The pandemic and increased remote work have made building interpersonal connections between employees more challenging. There is a significant decrease in water cooler conversations and lunch with coworkers. Challenging doesn't mean impossible, though. There are many things companies can do to improve connection at work.
"This can be done by organizing social events, starting conversation groups, or simply encouraging employees to take the time to get to know one another. When employees feel like they have a personal connection with their colleagues, this can help break down the barriers that can prevent effective communication. Additionally, fostering a culture of open communication across the company makes it easier for employees to share information and ideas."
6. Establish A Culture of Psychological Safety
The term "psychological safety" was coined by Dr. Amy Edmondson, a Harvard Business Professor who studied how clinical teams worked together. Her research concluded that teams with a higher volume of good outcomes made more mistakes than those with a lower volume of good outcomes. The difference was that the teams open to admitting and communicating their mistakes felt more comfortable expressing themselves in this psychologically safe space.
“Psychological safety occurs when members of your team feel at ease taking risks and being openly vulnerable in front of one another. There are some effective ways to increase psychological safety in the workplace. Involve team members in different decision-making processes and ask follow-up questions. Establish a culture of feedback where it is embraced and not feared. Avoid being negative and placing blame.”
7. Focus On Company-Wide Upskilling
59% of organizations consider upskilling and reskilling a top L&D priority. Skills development doesn't just enable individuals to reach their professional goals. It also opens doors between teams, providing clear pathways between enriching roles throughout the organization. A transparent career mapping framework opens team members' eyes and highlights opportunities beyond their silos.
Dawn Wood is an HR Manager at Woodyatt Curtains. In her opinion:
"One of the best ways to improve communication across a company is to foster a sharing environment by consistent, company-wide upskilling. Whether that's training for something as simple as Microsoft Teams and Zoom for a hybrid workforce, right down to introductory training for other departments to gain a deeper understanding regarding the work of their colleagues. An open, communicative environment flourishes in a workplace that is continually pushing the boundaries of learning (across all departments, not just keeping the learning department-specific.)"
8. Crowdsourcing Problem-Solving
It's easy to pigeonhole leaders or experienced employees depending on their specific areas of expertise. But if you continually turn to the same people when challenges arise, you could be missing out on the unique skill sets of other employees.
Sheila Callaham, Executive Director of Age Equity Alliance, discusses the importance of moving away from siloed problem-solving in favor of creative crowdsourcing solutions for business challenges. Here, she discusses this fantastic outcome of relying on collective intelligence.
“In one example, gamers of all ages (from middle school to self-described grandmothers) took part in a crowdsourcing challenge to configure ways to fold proteins—and then later RNA. They solved in three weeks what scientists could not solve for 15 years. Companies can achieve the same results by encouraging employees across the organization to problem-solve in areas outside their job functions. Employees self-group according to interests and work together to solve business challenges. By recognizing and rewarding cross-functional teams' problem-solving, you incentivize them even more."
9. Offer Teamwork Incentives
In an ideal world, employees would naturally seek horizontal collaboration opportunities with their peers. But there's nothing wrong with incentivizing your teams if they need a gentle nudge.
In a recruitment study, 85% of employees admitted that monetary incentives are an effective motivator. Alternatively, social incentives like praise and peer recognition go a long way toward improving cross-departmental teamwork.
Derek Bruce, Senior Director of the Skills Training Group, reveals why incentives effectively break through silo barriers. "By clarifying that the company values collaboration, HR can help to create an environment where employees are more likely to communicate openly, work together towards common goals and break down silos within a company."
10. Roll Out A Company-Wide Communication Strategy
According to an Asana report, workers use an average of 9 tools each day. So it's no wonder we can end up feeling overwhelmed. But if everyone has different tools to track conversations, it's easy to feel like you're left out of the loop or that your specific department is going in its own direction. All of this creates adverse silo effects in the process.
"A company-wide communication strategy could involve creating a communication charter or policy that outlines the company's communication goals, objectives, and strategies. Additionally, the company could establish communication standards and protocols to ensure that all the employees are using the same methods and tools to communicate with one another. The reason this communication strategy is so important is that it can help to ensure everyone is on the same page and that information is being shared effectively across the company."
Overhaul Your Organizational Structure With Nectar
At Nectar, we make it easy for teams and employees to stay connected, which prevents silos from forming in the first place. But even better, we make it fun, too!
Use our challenges feature to incentivize your departments to participate in team-building exercises, including health and wellness challenges and company training. It's a fantastic way to reinforce behavioral factors and improve positive outcomes for your entire workforce.
Our recognition tool is another way to blitz silos by allowing employees to give meaningful shoutouts to peers, which display proudly in the Nectar feed. Encourage employees from adjacent teams to comment and add points to each other's shoutouts as an uplifting form of social reinforcement.
Ready to eliminate the harmful effects of department silos and supercharge your organizational performance? Start building a productive company culture by checking out a self-guided Nectar tour or requesting a free demo today.