Are Departmental Silos Hurting Your Team’s Productivity?
The modern age of urbanization is an anomaly in the history of our species. For hundreds of thousands of years, homo sapiens lived a nomadic lifestyle in small bands or tribes. The lifestyle of our tribal ancestors has left a strong imprint on our deepest emotions.
This psychological imprint is evident in all the facets of our lives, including teamwork. It’s common for modern-day organizations to consist of thousands of employees. However, we haven’t evolved to collaborate or even co-exist with so many people.
According to the renowned anthropologist Robin Dunbar, an average human can maintain stable relationships with only 150 people. Moreover, we devote 40% of our time to an inner core of 5 people and 20% of the time to further 10 people. This means two/thirds of our time is devoted to only 15 people.
Unsurprisingly, every organization is an amalgamation of departmental silos. These silos can have a devastating effect on productivity. According to a survey by Clear Company, 86% of employees and executives cite a lack of collaboration or ineffective communication for workplace failures.
What are departmental silos?
Each department in an organization consists of people that are united by a common profession – marketing, IT, operations, HR, etc. Each department is led by a separate leader and most of their work-related communication is within their own groups. Without a strong alignment from the top, conditions are ripe for the departments to give precedence to their respective goals over the company. When this happens, the departments turn into silos.
What makes these silos so dangerous is that people fail to realize that they aren’t keeping the company’s interests at heart. This is because they still feel loyal, only their loyalty is misguided.
When departments within an organization start engaging in a turf war and competing for control over company direction, it can never be productive. Organizations lose more money than they can fathom due to this problem. According to Bloomfire Fortune 500 companies lose approximately $31.5 billion from failing to share knowledge across teams. And that’s just one of the many problems that departmental silos create such as office politics, miscommunication and missed opportunities.
According to a survey conducted by eConsultancy for CX teams, when asked if they receive adequate support from other departments, more than 40% answered no. They felt that other teams have their own agenda.
Every organization encounters issues caused by departmental silos. For example, at Taskworld we discovered that at one point both the sales and customer success teams were contacting certain customers for quarterly check-ins. This was leading to both unnecessary work and client fatigue.
Silos are also infectious. If one department works with a silo mentality, it also rubs onto the other departments of the organization.
How to prevent departmental silos?
- Drive alignment from the top
The #1 reason behind departmental silos is the lack of alignment in top leadership. Each department looks to their heads for overall direction. If the departmental heads struggle to align their goals with the company’s objectives, it will trickle down to their respective teams.
Conflict can cause a misalignment in top leadership. However, it can also creep in subconsciously if leaders are too consumed in their team’s internal affairs. Departmental heads need to ensure that they dedicate enough time to strategic communication to prevent silos.
A weekly or bi-weekly meeting where all departmental heads meet with each other helps immensely. Such a forum gives all the leaders an opportunity to share important updates, ask for support and highlight areas of improvement. It ensures that the high-level goals of all departments are aligned.
This doesn’t mean the alignment is solely the responsibility of the top management. Employees should be curious to understand how their work fits in the bigger picture. Organizations should encourage opportunities where such knowledge sharing can flourish.
- Build excitement around company KPIs
Each department has their own KPIs. For example, the DevOps team might be focusing on reducing site downtime, engineering on feature release while marketing on improving customer acquisition cost. In most companies, employee incentives are tied to departmental KPIs. A customer support rep would be evaluated by metrics such as response time and satisfaction score. Although necessary, such an incentive system adds to the departmental silo mentality.
Of course, departmental KPIs are important and can’t be eliminated. However, at the same time, it’s important for all teams to get excited about company-wide KPIs. This helps create a culture of alignment at the ground level.
Therefore, at least a part of employee incentives should be driven by company-wide KPIs. For example, for a SaaS business like ours, KPIs such as MRR (Monthly Recurring Revenue), LTV/CAC ratio (Lifetime Value/Customer Acquisition Cost) and NPS (Net Promoter Score) are indicators of the overall business performance. Every employee in their own capacity influences them. It’s important that employees understand how their work affects these KPIs. Their performance bonus should be influenced not just by departmental KPIs but company-wide goals as well. This would ensure that even an engineer who’s not directly involved in marketing, understands and cares about revenue metrics.
- Use a collaboration software
The popularity of cloud-based collaboration software has exploded in the last 5 years. Organizations are increasingly managing their projects, files, and communication in a virtual workspace. The existing COVID-19 outbreak has further accelerated the adoption of such tools.
Collaboration software allows people in the organization to track their work, share ideas and get a real-time update on the progress of important projects. It tackles one of the root causes of departmental silos – visibility.
When all the departments manage their work in one accessible tool, it prevents creation of silos. For example at Taskworld, we use our own tool to manage company-wide operations. Different departments can visit each others’ projects and see the top priorities.
If someone from the marketing department looks at the customer support project on Taskworld, they can easily understand what the support team is focusing on. This real-time alignment eliminates the need for having frequent meetings to touch base.
- Don’t discourage intra-departmental bonding
Preventing departmental silos doesn’t mean that departments should lose their own culture. That’s unnatural and counterproductive. Teams should still be encouraged to have group activities together and foster camaraderie among its members. Only when people have strong teamwork within their department, they can be expected to successfully align with people from other teams.
As mentioned by Matt Harris in his article on Martech Advisor, it’s important for departments to build their functional knowledge and expertise. They simply need to ensure that it doesn’t come at the cost of cross-functional cooperation.