How Silo-thinking Spreads, Smothers Synergy and Suffocates Strategy
March 08, 2018
Silo-thinking: even if unfamiliar with the term, you are likely familiar with its effects. That’s because the root of silo-thinking is differentiation and distinction. And this has consequences – conscious and unconscious.
You define any activity, role or responsibility according to predefined criteria, which may be shaped by the person, their applied skills and training or the way in which they create, use or adapt a system to carry out their assigned tasks. This is all well and good; only all too often we tend to identify ourselves by our roles and what we do. Even Aristotle (384-322 BCE) recognised this, as he is reputed to have said, “We are what we repeatedly do.” As result we, personally or collectively, tend to become:
- Protective and – clinging to the adage that “knowledge is power” – erect barriers to ensure that we maximise the perceived value of what we offer, and thereby our status; and/or
- Self-absorbed or unduly focused and single-minded, and thus uncooperative.
Collectively this may be at the individual business unit, functional or even divisional business unit rather than at the enterprise level. But when it occurs at the collective level – and is recognised – it is identified it as ‘silo-thinking.’ That’s when you start to take steps to remedy it. Unfortunately, even when you do, you may not realise how pervasive and pernicious it is.
It is, in fact, an integral part of the way our organisations are structured and governed – and even how individual executives are rewarded. Business unit leaders are typically accountable for the P&L of their unit, and incentivised accordingly. Thus silo-thinking sets in, spreads and solidifies. You get synergies at the enterprise level when you trade off some of these gains for the greater good of the enterprise. Thus you need to make tough choices here. But strategy at the enterprise level is rarely the sum of the individual parts. Too often CEOs are incentivised for short-term performance rather than the longer-term survival and growth of the business, and so these opportunities are missed and effective strategy is suffocated.
That’s right! It is something you build it into the very structure of your organization, and thereby sabotage your efforts to create synergy and smother and suffocate your own strategic efforts. The traditional management practice of creating discrete downward-operating teams, works against the cross-communication essential to enable you to become aware of and respond to the environment in which you operate, while your remuneration structures compound the problem. You are effectively no different to the frog that boils to death when you slowly heat the water!
Change Management and Organizational Development
My minor epiphany on this came when I read an article on LinkedIn entitled, “Change Management and Organizational Development”. Despite this rather innocuous headline, the article explores the difference between change management and organizational development and whether the two disciplines might be more effective if they worked together. While it ignores the fact the Organizational Development came first as an effort to improve operational effectiveness, with Change Management following to redress the worst excesses of Business Reengineering and it failure to address the human side of change, this is a well written article. It starts off with different definitions of the two disciplines, which in itself is an eye-opener, revealing how difficult it to even get consensus on something so basic.
I am reluctant to quote any specifics form the article. It is well worth a read and I would encourage you to do so, rather than try to glean limited and subjective snippets from what I could say. The point for me was that – as I read it – I was reminded of something I saw or read once, to the effect that “Nature is not divided into –ologies!” I realised that, in our efforts to break things down into constituent parts, we all too often lose the grandeur of the concept and “fail to see the wood for the trees.”
At the end of the day both Change Management and Organizational Development are concerned with improving the operational effectiveness of any organisation. If they are both viable (i.e. capable of adding value), then not only does there seem to be no valid reason for operating independently, but it ought to be imperative that they do. You certainly won’t get the synergy that their combined effort offers if you don’t!
Of course this is a form of silo-thinking. Nor is it the only area where this applies.
Change Management and Strategy
The idea of introducing a finite number of change initiatives through a hierarchical structure of change programmes or series of specific individual projects, in order to deliver a strategy, is also worth challenging. I am personally inordinately grateful for the change management training that finally introduced me to the measures for assessing the return on any project (something I had long struggled with and am embarrassed to admit I had never figured out for myself.) I still, however, question why it is not more widely recognised and so many change efforts – reputedly still in excess of 70% - fail? After all, such a high rate of change failure is, surely, prima facie evidence of failed strategic initiatives. And I cannot help wondering if it because of a similar isolation and disconnect?
I began to think along these lines after reading the innovative and highly thought-provoking new book, “Beyond Default: Setting Your Organization on a Trajectory to an Improved Future” by David Trafford and Peter Boggis. (To learn more about the book go to http://beyond-default.com/) A key lesson for me was the distinction between “strategic intent and strategic operationalisation” as opposed to the more traditional classifications of “planning and implementing.” The difference is not just semantic. Implementation perpetuates the idea of “executing a set of changes needed to achieve a desired vision or end-state.” Operationalisation, on the other hand, accounts for the need to change, not just the structure, but “also its operating model and operating state.” This is significant because it unifies the two elements to a far greater extent and ensures the accountability remains with executive rather than being delegated. Now it becomes impossible to blame poor project and/or change management for a change failure.
Control versus Empowerment
The root problem here is the embedded legacy of command and control management. The concept of “implementing” a strategy is no more than the continued expectation that employees are paid to do whatever they are told. “I want you to do this. Now go and do it!” This inhibits individual initiative and smothers synergy. And the failure rate of change initiatives and projects proves that you can no longer blindly do this. (Messrs Trafford and Boggis do differentiate between “push” and “pull” projects, and argue that the “push” nature of historic project oversight is still appropriate, for example where there are very well defined outcomes such as closing a business unit or plant, but not for more transformational change.)
It is no good saying that “command and control” is dead, if you continue to use its component elements. For, it goes without saying, that you cannot “operationalise” your strategy – build it into your operating state – if your employees are not “on board.” Each and every one needs to understand, agree with and be committed to what needs to be done, and they need to bring all their capabilities to the process. Thus, it is time to get serious about empowerment.
Naturally there are many ramifications to this. One aspect, however, you should guard against, and take care to ensure you don’t build the potential for in your efforts, is silo-thinking. But, when you remember that silo-thinking is the consequence of isolation, artificial boundaries or a sense of self-importance this need not be as daunting as it may first seem. The key is for people to be “part of a tribe.” When people feel this and the sense of belonging that goes with it collective interests become paramount and communication barriers break down.
This also makes it easier to “de-compartmentalise” specific skills. Thus instead of having the kind of divide between Change Management and Organization Development with which we began the discussion, we have a pooling and melding of the different skills of both, working synergistically together rather than competing. This provides a more complete and constructive environment for all, and a more comprehensive solution for the organization. Certainly, in an environment like this operationalising strategy becomes much less of a challenge, there is less stress and everyone ends up better off.
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If you like what you have read contact me today to discuss how my ‘Every Individual Matters’ Model could help you value your people and provide the catalyst to help you create an organic culture where everyone cares and the business becomes our business, embedding continuous improvement that engenders ‘love at work’ and transforms – and sustains – organic business performance.
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Bay is the founder and director of Zealise, and the creator of the ‘Every Individual Matters’ organizational culture model that helps transform organizational performance and bottom-line results. Bay is also the author of several books, including “Lean Organisations Need FAT People” and “The 7 Deadly Toxins of Employee Engagement” and, more recently, The Democracy Delusion: How to Restore True Democracy and Stop Being Duped.
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