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Silo mentality

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FINEX Folio -- Reynaldo C. Lugtu, Jr.

FINEX Folio

“Employees in my company are working in silos.” This is a common issue raised by business leaders when asked why their companies are not innovating.

Like large concrete cylinders for storing bulk grain, silos in an organization are monolithic departments such as accounting or sales, or similar worker groups such as administrative assistants or managers, that keep information to themselves, minimizing if not, preventing any form of sharing. Silos can also be geographical, such as Luzon, Visayas, and Mindanao office branches, that are separated by invisible force fields.

But how do they end up like these? It starts when employees develop loyalty to a group or manager. Lack of direction from the top regarding cross-functional meetings and coordination reinforce silos. Even the benign practices of Philippine-based companies such as holding Christmas party group performances and departmental team-building activities, which build camaraderie within a group but promote and strengthen silos.

As silos solidify like concrete, employees become more exclusive and insular, distrusting others from groups or departments. Cynicism and resentment develop as members in a silo reject outsiders, withholding information and cooperation. This is where a kind of mindset sets in like a hard-to-remove plaque inside the organization.

The silo mentality is defined by Business Dictionary as “a mindset present when certain departments or sectors do not wish to share information with others in the same company. This type of mentality will reduce efficiency in the overall operation, reduce morale, and may contribute to the demise of a productive company culture.”

Indeed, silo mentality is a pernicious organizational disease that stunts innovation. It forms part of the overall culture of the company and manifests through employee refrain like, “I can’t do that, it’s not part of my job”, or ““that’s the way we’ve always done it.”. It is the biggest barrier to CEOs desire to digitally transform their organizations. In this age of technological disruptions, organization members need to work together toward a shared purpose. But how can you break down silos?

Change starts from the top. The CEO together with his or her lieutenants should display collaborative behaviour and cross-functional communication. They should mandate their employees to institutionalize interdepartmental meetings to jointly solve problems and come up with new ideas. There should be task force, sponsored by the CEO and headed by a senior executive, charged with breaking up the silos and develop practices that require collaboration and communication. Instead of departmental competition during Christmas parties, why not promote cross-functional group performances? Apart from departmental team buildings, why not promote other interdepartmental activities?

Moreover, employees should undergo reskilling and coaching to change behaviours, attitudes and mindset. In our consulting work, we have identified three skills that needs to be developed and practiced — empathy, collaboration, and complex problem-solving/agile decision-making. Through classroom training, role-playing, and on-the-job coaching, employees will develop empathy toward colleagues and learn how to collaborate with other groups to jointly solve problems and make decisions.

Lastly, reconfiguring office spaces can do wonders by breaking down office walls and laying out open work spaces. Google is the paragon of collaborative work spaces. In Google Philippines office, there is a common area where employees and guests can meet, eat, or just hangout to talk to others. There’s fresh supply of free food, stylish furniture, and cool ambiance that encourages employees to meet there and collaborate.

Building trust amongst employees will lead to openness and communication. But silo mentality is not an easy problem to fix. At times, drastic moves such as letting go of certain employees and introducing fresh blood and new leadership into the organization to mandate changes.

What’s tricky is that Filipino culture is innately a siloed one, which makes it easier to form silos in organizations. From hometown silos such as Caviteños, Batangeños, or Mindanaoans, to school silos such as Ateneans or LaSallians, to sport team silos and religious silos — we lack national unity because of silos; hence, our country can’t collectively focus on national progress. Perhaps the same concepts in fixing organizational silos can apply.

The opinions expressed here are the views of the writer and do not necessarily reflect the views and opinions of FINEX.

 

Reynaldo C. Lugtu, Jr. is President & CEO of Hungry Workhorse Consultancy Inc, a digital and culture transformation firm. He is the Chairman of the ICT Committee of the Financial Executives Institute of the Philippines (FINEX). He teaches strategic management in the MBA Program of De La Salle University.

reylugtu@gmail.com