One of the biggest keys to a companyâs success is its ability to communicate among various teams and departments. Bad things can happen when a company doesnât communicate effectively.Â
For example, several years ago a major car manufacturer had trouble with ignition switches. The faulty ignition switches were causing some cars to stall while they were being driven. A group of engineers made decisions about how to fix the problem without knowing that another team had designed the airbags not to deploy when the engine is off. This led to accidents, some serious, and millions of cars being recalled.
Had there been better communication and collaboration between these teams, they might have avoided these costly mistakes.
Unfortunately, these organizational siloes are not uncommon. While not all business silos lead to catastrophic results, silo mentality does reduce efficiency and can contribute to poor company culture.Â
So what is âsilo mentality,â and how can you prevent it? Read on.
What are business silos, and where do they come from?
Silos are large, cylindrical structures used to store bulk items such as grain. Business silos in business are used as a metaphor to describe how employees are divided into different teams, departments, and geographic locations.Â
Silos usually form organically as a company grows. Employees are divided by roles, skill sets, rooms, floors, buildings, cities, and countries. Silos can exist in a company of any size but are more common in large companies, especially where there are multiple geographic locations.
From an organizational perspective, silos make sense. They give you an overview of a large, complicated, and diverse systemâkind of like an org chart. When you hire new people, silos can give you a better idea of where to put your new hires.
So silos themselves are not the problem. The real problem is silo mentality.
What is silo mentality, and why is it bad for business?
Silo mentality, or silo thinking, creeps in when people develop a sense of isolation. Over time, isolation can lead to employees feeling a greater sense of loyalty to their team rather than to their employer. This loyalty to each other can lead to decreased trust of individuals working on other teams and in other departments. Communications eventually break down, employees are reluctant to share information, and collaboration among various teams is less likely.Â
This mentality is often seen as a top-down problem. Senior management might be competitive, have distrust of other managers, or feel reluctant to share information with other departments. These attitudes are eventually passed down to teams and individuals.Â
In time, teams lose focus and no longer share a vision with the rest of the company. They develop an âus vs. themâ mindset. All of this can lead to a bunch of problems, including:
- Intense competition: Competition can be a good motivating factor. But it can become a problem when teams stop sharing information and collaborating with others because they want to âwin.âÂ
- Inefficiencies and redundancies: Working in isolation can lead to unnecessary, inefficient, or duplicated work. This prevents your team from being agile and adaptable. And it slows down progress in the organization and can lead to poorly developed products. Â
- Confusion about responsibilities and ownership: When working with a silo mentality, there is sometimes a lot of buck passing. Employees will say, âthatâs not my jobâ and try to pass off work to others.
- Not being able to see the big picture: If employees canât see the big picture, they wonât know where their work fits in the overall project. And they wonât have a sense of how their work impacts work being done on other teams and other departments. Â
- Reduced accountability: When employees are confused about responsibilities and where their work fits with other work, who is accountable when something goes wrong? If they are reluctant to take ownership, they wonât feel accountable for their work.
- Unease with corporate culture: Silo mentality and isolation can make employees feel like they are working in a vacuum. If they donât feel like theyâre getting the support they need, it can lead to poor decision-making and low morale. They might see the companyâs culture as toxic and feel like they need to look for a job somewhere else. Â