New Webinar On Demand: Organizational Silos that are Slowly Crippling Your Team’s Productivity

Welcome to the cPrime webinar on why organizational silos are slowly crippling your team’s productivity. We want to thank you for joining us today and before we start, we would love to ask a couple of polls. So we’re gonna send the first poll up and the first question is do you have a hard time reaching people in other parts of your organization who need to have knowledge? Do you have a hard time reaching people in other parts of your company who have knowledge you need? We’re gonna allow individuals a couple of moments, get a high percentage of you voting. It seems to be an issue in your company.

Okay, so we got about 34% of you, it’s about midway with the next section around two so definitely have some of those challenges. For our second poll we want to ask the question, do people outside of your department understand what you do? From a scale of one to five, one being they don’t know and then five confidently saying they do know. This will definitely allow us to more essentially focus our webinar today by those answers to the poll questions, so we thank you for that. I’ll give you a couple of seconds to finish the poll.

Excellent. The results there are we’re about midway there as well for “I know they don’t know” and it’s possibly the reason why you’re joining our webinar today. Thanks for those poll results, we really appreciate that. I’d like to now start the webinar and introduce you to Jaleh Partovi, who’s and Agile Coach here at cPrime. Jaleh.

Jaleh Partovi: Thank you so much Patricia and welcome everyone. It’s wonderful to have the opportunity to be here and I’m delighted that you guys have joined. A bit about myself. I’m an Agile Coach with cPrime. I work with teams and organizations to help them get started or get better at applying agile practices as well adapting and agile mindset. Prior to focusing my career on agile coaching and training, I had positions in project, program and portfolio management in a number of industries, delivering corporate systems and business transformational initiatives.

Would also like to mention my Agile certification credentials, CSM, CSP, CSPO [inaudible 00:02:57] Scrum Alliance. As well, I am an SPC Scale Agile Framework Program consultant. Next slide please, Patricia. For today’s webinar, I’d like to share with you some learnings from experiences as well as research about silos, organizational silos and silo mentality. Silos can happen in any firm, large or small, and can be detrimental to organizational success by chipping away at productivity among numerous other undesirable consequences. For example, breaking teams apart by specialization areas, like engineering, operations, product management, etc. that’s modeled after the traditional divide and conquer strategy that aims to break up large problems into smaller parts no longer works effectively in today’s business climate.

This approach to organizational modeling unfortunately creates divisions of labor that causes so many walls of confusion among the silos, that the organization’s speed and agility is affected. Now even though in some industries silos are important for efficiency purposes, in order to remain competitive and to succeed during times of significant change, various parts of the organization need to work together, but these various parts, we often find are siloed and unaccustomed to or even unable to communicate with one another because they’re either culturally misaligned or mistrustful or territorial.

As well, silos create an environment where sharing and collaborating becomes challenged or sometimes even virtually impossible. This causes problems that show up in multiple other areas. To mention a few: in duplication of cost and effort, lack or little knowledge transfer or synergy, and the largest problem of all, a lack alignment with the overall company strategy. Now having listed all of this, that’s not to say that silos inevitably prevent success. We can recognize common problems associated with silos and can even anticipate them and then counteract them by practices and mindsets that build trust and improve collaboration. That’s what we’re going to focus on for today’s webinar, obstacles and challenges that arise from outmoded organizational models and explore techniques to deal with both the structural barriers and the silo mentality that stifles communication and keeps teams from working together as optimally as they otherwise could.

Next slide, please. Let’s start off with what we mean by silos and how they form. Silos are psychological and physical barriers that separate people, business units or locations and prevent people from collaborating with one another. Silos exist within us and our workplaces. As humans, we’re self interested. It’s not malicious. We were built to focus on ourself. Geography and organizational design can create physical silos that impede information flow. It’s hard to learn what someone is doing if they work in another building or another country, but even in small companies office doors create silos. If I don’t see you or interact with you daily, I won’t be thinking of you.

Silos come in a variety of flavors, for example, most large companies have divisions or even groups and functions within divisions that operate in silos. This can be for good reason. In the knowledge economy, jobs often require that professionals work with people who have similar professional skills to fulfill specific mandates. The need for deep expertise leads employees to follow vertical career paths, staying within a functional group, let’s say supply chain or HR. Often, though, we see little opportunity for individuals to bring knowledge from one area to another. For example, someone from finance bringing their knowledge and expertise to HR while also learning about talent management.

Silos can exist to harness knowledge based skills or specific job functions. They can also be geographic. In our increasingly global business environment, companies of a certain size and scope are required to have multiple locations, often in various countries or across continents. In other cases it might be necessary to have a line of business or function in a specific location, for example, an energy company locating downstream operations near the energy source. Another example, acquisitions or entry into new markets that can increase cultural disconnects. All of these dynamics can compound the effects of existing silos or create new ones by causing a sense of separation for the line of business or function from the rest of the company.

Now last but not least, another cause for silos can be decentralized or partial ownership of cross-business processes. This happens when lines of business or functions try to optimize their own part of the operations with little regard for how they might be affecting other parts of the organization or even customers. In doing so they develop an adopt their own systems that could result in uncoordinated overlap or a plethora of unintegrated platforms. This creates technology silos because technology isn’t shared cross organizationally. It also creates information silos because of barriers in easily sharing information across organizations.

Now other forms of silos to mention, project silos. This occurs when practices or other information isn’t shared between groups working towards similar goals or in similar ways. Functional silos could also arise when there’s uncertainty about people’s roles within an organization and might lead to redundancy or feelings of under appreciation. For example, a silo could form extending across departments to include similar worker types like administrative assistants or managers of people, etc. Next slide, please.

Now besides the structural silos, there are also cultural or political flavors of silos leading to silo mentality. Silo mentality forms slowly over time. As a result the systems and processes that reward information hoarding. They are often exacerbated by fear, itself a byproduct of a lack of vision or communication or a healthy culture. This is how it goes People begin to develop more loyalty to their group then to the whole organization. Silos solidify and members become more and more insular and distrustful of other groups. As the internal team bonds solidify and trust between members of different silos decreases, it makes collaboration between them less likely. Once trust disappears and team members are unable to or refuse to share vital information, it becomes increasingly difficult for groups to work together. Over time, members of the same silo start to consider their department and organization of its own within the company and forget that they have at least one huge goal in common with the other departments – the success of the company that they’re all a part of.

This helps explain why it’s not a coincidence that most organizations struggle with intradepartmental turf wars. When we look deeper, we find that more often than not silos are the result of a conflicted leadership team. Widely believed, one of the easiest ways to unite people is to give them a common adversary, which motivates them to perform better collectively. If it’s friendly competition it may boost the performance of the whole company as everybody will aim to perform at the peak of their skills. However, with envy or price on the line, people may try to do everything in their power to stop their rivals from winning, like minimizing contact, withholding information, trying to create conflicts of all sorts. Constant disagreement between leaders of different groups likely drives a line between their subordinates. They start to chase only the goals of their silo and withhold information that’s important to their other colleagues. Hence, the bigger the company the more harmful a role silos potentially play. Next slide, please.

Let’s look at potential consequences of silos. In a nutshell, siloed companies miss out on opportunities that come up in a fast paced business landscape. Nor are they able to make productive decisions about how to change in order to leverage those opportunities. In fact, many other chronic organizational problems are a direct consequence of the silo effect. Let’s consider some of these. With silos, people can fall easily into only communicating with those directly around them or those who are at the same level in the organization. When there’s little or unclear communication between groups, the right hand doesn’t know what the left hand is doing. As well, leaders can fall out of touch with employee sentiment and not hear crucial feedback.

Silos also foster complacency. In an organization where people in different divisions have little contact with one another, it’s easy to become inwardly focused and complacent with the status quo. For example, if development has little communication with sales, development people will never know end customers’ changing preferences and the organization could lose out to another competitor who meets customer needs better and faster. Then there are other consequences of silo mentality. Lack of ownership is one. In a silo culture managers often struggle to engage people in collaborating to implement changes. It’s not uncommon for it to feel like pulling teeth to get people to own collective goals. Does it look to you sometimes that people are quite ready to attend meetings, have their say and make the appropriate comments but as soon as the meeting is over they’re overcome with apathy and do little until they go to the next meeting?

Then there’s silo mentality resistance to change. Despite the unsatisfactory nature of the circumstances changes are often still resisted either openly or covertly. Very often problems are perceived to be caused by other people or groups not doing their job properly. Because of this sentiment, groups and their leaders are rarely feeling a need to change themselves. When things start going wrong, problems can quickly create a blame culture. Everyone is eager to ensure that someone else is blame for inefficiency. The latest management fad is then imposed attempting to correct the situation, but staff then feel that they’re subjected to an unending series of apparently meaningless changes that often seem to be for the sake of change and rarely seem to bring about noticeable improvement. This mixture of perception can deepen a culture of resistance and mistrust and in this type of situation naturally work becomes a stressful, frustrating and far less satisfying and productive than it potentially could be.

Therefore, organizations with a strong culture of silo mentality generally suffer from lower morale and even lower job satisfaction. Clearly the list of consequences from silos that we just covered is plenty to keep an organization operation well below their full potential and unfortunately, silos are usually resistant to change. Still, despite the difficulty we can identify and anticipate these common problems and counteract them, and doing so takes the right culture and solutions that build trust, improve visibility and facilitate collaboration. Next slide, please.

To present solutions for dealing with silos, I will be framing them in a model that borrows from principals of integral theory. Integral theory, to give a quick refresher, is about considering as many perspectives as possible, essential from a complete picture of a subject. This approach is being applied everywhere these days and is very much relevant to product development as well. There are two main dimensions to integral perspective. The external component like structures, tools and environment and secondly, the internal components which include emotions, values, cultures, purpose and intention. These two dimensions are analogous to what agile practitioner Michael Zoda calls “being agile and doing agile” that you’re likely familiar with.

Now, applying these perspectives to our subject in dealing with silos and silo mentality. With the internal dimension our goal is to cultivate the right mindset and culture of collaboration, and in support of that, to coalesce people around a common vision and to working together for common goals. Now unifying teams with a common goal is absolutely critical because in the absence of common objectives from leaders, individuals and groups create their own. This can lead to conflict promote silos. But when all groups have the same goal the reasons to create silos are greatly diminished. A wonderful example to support this is a quote in an article that I researched from Executive Vice President and Chief Marketing Officer at Target. For him the unifying vision is all about customer satisfaction. He says, “One of the things I try to do is to stay obsessed with who we’re serving. The more I start with the guest, the less the way we’re organized is relevant. That’s because when all team members are focused on a customer they solve process, organization and technology issues on their own.”

Other silo busting actions in the internal perspective of culture and values dimension here are creating a culture of gratitude so everybody’s efforts are acknowledged and never taken for granted. Culture of sharing information and organizational stories so that knowledge is shared. As well, bringing the outside in. Making divisions share data with one another so people understand how each division is performing. What customer complaints are, where there’s room for improvement, etc. of course, making it clear this is an important opportunity to galvanize action. It’s not a blame game. Turning to the external dimension, with this perspective, we want to develop structures and practices that foster communication and collaboration. Helping teams embrace working together in a unified way.

As well, with access to critical information from upstream and downstream. It’s the increased communication from management and among teams that will increase trust and begin to chip away at the problem. Many examples in this area are systems thinking. That is optimizing for flow of work cross organizationally. Not individual function. Secondly, practices that facilitate collaboration like co-location, information radiators, open space architecture with common workplaces, work spaces. Most importantly and my favorite, forming cross functional teams. To recap, the two internal and external dimensions give us a two prong approach to dealing with silos, aligned around intricative perspective. Now, let’s dive a bit deeper into each area starting with promoting a culture of collaboration and breaking the silo mentality and then forming cross functional teams. Next slide, please.

Let’s clarify a bit what we mean by silo mentality. We recognize the silo mentality attitude when several groups within an organization do not want to share information or knowledge with other groups. We may see this happening among individual contributors when the employment situation feels competitive like with a commission based job where individual performance numbers directly affect compensation. We might also see it among competing departments like marketing and sales where some assigned duties exist at least in part in both departments. As well, it might show up among geographically dispersed offices as squaring off against each other in the home office.

This desire to withhold information can negatively affect employee morale. Especially when employees are aware of the issue and are unable to do anything to change it. Over time, this information bottleneck contributes to an unhealthy corporate culture that needs to be addressed to keep employees motivated and happy to come back to work. To combat the silo mentality, an important first step is to create a sense of unity within the organization. Gearing the organization to work towards a single goal helps create a sense of community and encourages more open communication. Patrick Lencioni in his book Silos, Politics, and Turf Wars tells us, “Silos and the turf wars they enable devastate organizations. They waste resources, kill productivity, and jeopardize the achievement of goals.”

As a device to leaders to tear down silos is not only do all employees of the company need to row in the same direction, but the executive teams must be engaged and at the forefront of steering the boat. A unified leadership team will encourage trust and break managers out of the my department mentality and into the our organization mentality. Related to unified vision, another important element in combating silo mentality is a shift from a silo to systems thinking mindset. Quick refresher. Systems thinking is a big picture view of things. Recognizing the interconnections between parts of a system and synthesizing them into a unified view.

Systems thinking then implies looking for ways not just to improve the efficiency of individual elements, but to optimize the way these elements interact. Making one process faster, for example, development, without considering its impact on QA, staging, production will generate new constraints downstream in a software product development life cycle. Rather, we want to view things as one continuous process all the way to accomplishing the common goal and defining success in those terms as well. Everyone has to own the overall goal. It’s of no use to say, “Well, my part works but they can’t get it to work.” Instead, everyone has to do his or her best to realize business value. When we use this type of thinking across teams and optimize for flow instead of silos, along with a unified focus, we would encourage teams to share more and collaborate more to ultimately accomplish organizations common goals.

On this last note, our goal is to facilitate information flow and visibility so that the flow of work is also enhanced. One proven way to move in this direction is building cross functional teams. That’s what we’re going to go into now. Next slide, please. A bit of history about working cross organizationally that I have picked up from the Harvard Business Review article. Working across organizational boundaries according to this article was a new way of thinking 25 years ago largely championed by Jack Welsh, then CEO of GE. Welsh was convinced that the speed of globalization and technological innovation in the 21st century would require companies to work very differently. With faster decision cycles, more employee engagement and stronger collaboration than had previously been required to compete. He advocated for a boundary-less organization and to build it, he initiated what became known as the GE Workout Process.

A series of structured and facilitated forums bringing people together across levels, functions, and geographies to solve problems and make decisions in real time. Now, fast forward to today. With our communications technologies having dramatically improved and with instantaneous access to massive amounts of information, Welsh’s boundary-less organization one would think would organically be the defacto reality for most companies, but we know that unfortunately this is indeed not the case for many. In fact, the more complex matrix organizations that have been put in place with the intent to improve things are actually making it harder to get the right people together for fast decision making. To illustrate this point, the article cites this example of a senior executive at a large high tech engineering company who was concerned that many of their big customer programs were over budget and behind schedule.

After some investigating, they discovered that their fragmented geographically dispersed matrix structure made it very difficult for the program managers to coordinate efforts across functions and keep everybody focused on the cost and delivery goals then get to reach consensus. They give an example of a particular program manager’s challenges, who had to coordinate among the dozens specialized engineers. Since each reported to different departments, this program manager had to constantly go back and forth with the engineers managers about disputes over scheduling, conflicting priorities, etc. At the same time, the program manager was looping in supply chain partners as well, quality, sales, finance teams that were all dispersed around the globe.

Because of how siloed these functions were and how many different layers of commands you had to go through it was nearly impossible to bring these units together when it was needed. Decisions were delayed and of course the program’s performance suffered. Even the tools like video conferencing and instant messaging helped people communicate, they didn’t help with getting everybody aligned on the same priorities, nor did they foster rapid decision making. Senior management knew this was an issue, but they also valued the lower cost of having functional experts reside in different centers of excellence so that they could be assigned to programs when workloads shifted, a culture that had evolved over many years. Instead of changing the structure, they asked their teams to initiate the workout process to improve collaboration and speed up decision making across the various organizational boundaries.

These sessions physically brought together all the people who were working on different aspects of a single program, including the program manager, the 20, 30 key engineers and experts involved and managers from functions like procurement, sales, finance, etc. in preparation, the program manager defined the issue, pulled together the relevant data, and recruited a senior executive to serve as the on the spot decision maker. The main goal was that these cross functional teams had to reach consensus on a solution in two days and devise a plan for executing it. They would present this at a town meeting on the second day and the senior exec would then say yes or no to the various recommendation.

Instead of the program manager chasing after the engineers through a never ending series of meetings, the workout forum brought them together and led them to reach a solution quickly. This workout style practice might resonate with some of you as similar to say, scale agile frameworks program incremental planning event, where cross functional teams come together during the course of two days to divide the high level plan of execution and sort through risks and dependencies. So does scrum essentially establishing collaboration mechanisms that cross group boundaries at the team level internally to the team. I picked this example to share because it resonated with me very strongly. In my pre-agile days a program manager, I lived through very many similar scenarios. Chasing after managers of people on my projects to resolve fractional assignment issues rampant in matrix organizations or trying to get strong willed stakeholders across different business functions come to consensus.

Until a pivotal point in my career when I was given the responsibility to implement a global CRM system after several prior failed attempts by others. The system was to encompass multiple business function in multiple geographies in order to retire numerous other local systems and processes in favor of this global core system. The prospect of living through a similar ordeal as the program manager in the GE story that I just shared with you was planning to keep me up at night in the early days of the project forming. I knew there had to be or need to be a better way if the project were to succeed and if I personally were to survive it. It turns out, the SI we selected to help with the implementation insisted that we adapt an agile approach for the implementation, forming cross functional teams with product owners from each of the respective business functions collectively guided by steering committees, aligned and led by a main initiative sponsor.

The success of the initiative in terms of quick sustain wins realize the through cross functional collaboration and decision making and leadership alignment was the turning point in my career. From then on, there was no turning back and I never stopped pursuing and promoting that type of cross functional collaboration and my choice of career focus today as an agile coach is a testament to that. The underlying idea here for breaking silos is to form collaborative groups that cross organizational boundaries. More specifically, for the world of product development, teams that consist of individuals from all the disciplines necessary for delivering a product. With every member of the cross functional team, owning the delivery instead of treating each discipline as a separate, centralized service organization, the team becomes the key organizational construct. With a cross functional team, we can reduce the, “it’s not my job” syndrome and other walls that stifle communication between teams and old world product development organization. Next slide, please.

To wrap it all up, dealing with silos is no easy task. The boundaries that exist in organizations today are difficult to breech. However, avoiding to deal with them appropriately will be more detrimental to the employees and ultimately, the overall health of the organization. The approaches we covered today to counteract the undesirable consequences of silos emphasize one, a unified vision and providing people with a clear purpose and ultimate common goals. There’s nothing more powerful in any organization than having everyone rowing in the same direction. Two, boosting the sharing culture and encouraging environments of necessary transparency, and last but not least, building bridges between the different silos, through which the information can flow freely. Whether it’s going to be by creating cross functional teams, holding regular meetings between departments or finding a way of your own. This is all to improve collaboration, communication, and trust between teams.

Silos are anti-collaborative and in product development, collaboration between people with different skills is the differentiator for delivering better products more quickly. The good thing is, the process of breaking down silos by itself makes an organization more flexible and agile for the future. Silos may remain, but they’re less likely to be rigid obstacles. There you have it, folks. Thank you so much for giving me your time. Patricia?

Patricia :  Wow, that was pretty powerful and I’ve been on some teams when they quickly worked together and became more agile. More of the project got done. I think I’ve got some tidbits to take back to my own department. We’ve got some questions. This first one resonates on one that I probably would ask. For those of you that haven’t had an opportunity, do post those questions in the question chat box. We’ll try to get to as many of these as we can. First question, what are some of the examples of how companies are effectively dismantling those silos?

Jaleh Partovi: Yeah. There are studies that show that companies are seeing results from cross functional product development teams. As well, job rotation and cross training seem to be successful. Of course, creating informal networking opportunities might sound trivial, but there’s also strong evidence that relationships heavily impact productivity and creativity. Then other things to mention here are open space architecture and common workplaces. Sofas, pretty lighting, cappuccino machines. All of those to encourage people to chat and share ideas and build relationships. Those are some of the examples that I could think of, Patricia.

Patricia : Yeah. Wow. Question from Brian in Los Angeles, how do you know whether your organization is affected by silos?

Jaleh Partovi: There are some key signs. One sign I would say is redundancy. For example, you might hear that another unit has a dedicated group just like yours. Another red flag, if you have a hard time reaching people in other parts of the company who have knowledge that you need. Someone must have the knowledge, but you don’t know who does or even may not know how to find out. This tells you that people are not sharing information or an information sharing system is not in place. That was the driver behind posing the two poll questions at the beginning of our webinar this morning.

Patricia : Wow. We have a question from Sarah in New York. What HR policies might contribute to silo building unwittingly or otherwise?

Jaleh Partovi: Yeah that’s a tricky one. I’m especially just going to be sharing my own point of view here. Incentive and performance systems I believe should encourage people to collaborate, but they often don’t because of motivational differences. It’s also hard. Rewarding cross functional behavior is very tricky because it’s hard to trace collaborative work to the bottom line. Incentives, though, likely aren’t going to change behavior in my point of view. If you’ve got to use leadership, a combination of leadership, persuasion and recognition of behavior to encourage silo busting behavior. You’ve got to promote people who actually do this well.

Patricia : Wow. Then our last question from Taylor in Atlanta. Interesting. Are there situations where silos are good for organizations?

Jaleh Partovi:  Well, okay. Well, I think this might sound [inaudible 00:39:33] I’m going to be going against everything I’m going to talk to, but there is actually a book out there about collaboration who’s author name is Morton Hansen. The title of the book is very long and it escapes me now. He essentially advocates that collaboration is not always productive. He says, for examples, some sales teams do worse when outsiders offer to help. His point of view is that the cost of cross unit collaboration is high. You’ve got to learn another language, you’ve got to appreciate other’s value system. You’ve got to negotiate terms and you’ve got to invest in time consuming meetings, etc. Sometimes it might be energizing, it might be attractive. Sometimes it’s not. His suggestion is that HR professionals should be assessing whether the effort is worth the payoff. This is just purely his perspective. Obviously from my presentation, you could guess that my point of view is going to be.