Thursday, December 4, 2014

Is Silo Eating your Strategy for dinner

Silo builds the wall in people's mind and creates the barrier in organization's 'heart.' 

Many of us like the witty quote from Drucker: “culture eats strategy for lunch.” The strategy is indeed in the face of more risks than culture, could it be the SILO – the symptom of industrial management mindset will eat your strategy for dinner?

Digital means more fluid and responsive network forms. We have transitioned from an industrial to digital era –the knowledge and relational economy - with this shift has come a change in organizational forms away from the traditional rigid hierarchies managed through "command and control" to more fluid and responsive network forms. Yet many apply old management mindsets to new ways of organizing, and this legacy of the old economy limits many 'networked' organizations. At the same time, even many new organizations have not developed collaboration as a core competency to support, resulting in the high costs of conflict and inertia when values collide, members remain disconnected, hoard knowledge and power within silos - in essence, organizations lose their collaborative advantage as they are being over managed and under led, and do not have the competence to collaborate. 

Breakdown silos is everybody’s responsibility, and leaders have to walk the talk. Silos don't come down to individuals as the core cause - they emerge as a result of organizational wide influences - so the focus should be more upon the  whole of organizational change, rather than individual change - colleagues, organizational leaders, sponsors etc, all have a hand in the existence of silos and all have a role to play in breaking down silos.

Reducing barriers and optimizing connections and synergies are always beneficial. Silo strategy will more than once lead to failure, and it’s important to have strategies that are in sync with business vision and mission and, more importantly, coordinate and integrate between all teams to achieve macro success at the enterprise level. However, the choice of words vs. the actual mentality is always up for interpretation. The case of working in an environment where there are barriers to getting things done is so counter-productive, and barriers are in every place. Hence, it is strategically imperative to create synergy via optimizing connection and harnessing collaboration.   

Silo drags down the digital speed. Organizations do need to be more agile and responsive to rapidly changing circumstances, but that doesn't mean doing the old things faster. It means doing less on autopilot, and paying more attention to decisions and actions. Speed, agility, responsiveness, reductions in silos and innovation can only function well if there is a clear, concisely articulated vision, mission, and values. If the communications are clear and people embrace the values, it is remarkable what can happen. So the significant improvements are possible to create win-win-win situation: 
Win 1. The customers get better service 
Win 2. The costs of inefficiency are reduced 
Win 3. The workers take ownership of the process

Silos aren't interested in innovation. Silo thinking has a vested interest in maintaining the status quo, it dislikes the new way to do things, stifles innovation, prefers to stay in the comfort zone, be inflexible to adapt to the changes; does not care about whether the whole is better than the sum of pieces.  There are far more devastating costs to the well-siloed organization than speed. The cost in lost creativity is much more critical, because it stifles the change to produce the creative working environment, or increasing the profitability of the company.

Silo cannot be torn down overnight, unlike culture, it is more visible, when you try to accomplish the work, it is the very barrier to stop you from doing it; it is more touchable, like the wall in people’s mind to create distance from the trust, your change management needs to handle it effectively before it eats your strategy.


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