In a recent Time magazine article entitled “We’ve All Got GM Problems,” columnist Rana Foroohar talks about General Motors’ recall problems. She says the problems came to a head because the people and departments involved “literally weren’t communicating with one another.” She chalks up those problems to “a systemic problem in most big corporations as well as governments – insular management or, in the parlance of gurus, information silos.” As an example, she points to Sony who ”once had two separate divisions working on creating the same electrical plug without anyone realizing it.” With all due respect to Ms. Foroohar, information silos are not unique to Fortune 500 companies and governments. Unfortunately, small and mid-size companies often have them too. And they can create just as much havoc in smaller institutions as they do in large organizations. For more on this, please read below.
In business, functional silos are a necessity. That is, each division or department or team needs to know where it’s functional responsibilities begin and end. Without such boundaries, there would be overlap, duplication of effort, and in general, chaos. But information silos are a different matter entirely. You want there to be as much transparency as possible between all the company’s operating units. In the best of all worlds, everyone would know everything about what everybody else is doing, why they are doing it, how they are doing it, and when they are doing it. A friend of mine used to talk about operating his company according to “the Doctrine of No Surprises.”
So why do these information silos exist?
In some cases, these exist due to the paranoia of the operating unit’s manager. He or she may hoard information in the belief that there’s job security in being the only one who really understands how the unit functions. But it may also simply be that the manager doesn’t want to be second-guessed by anyone else on how he or she chooses to do things. I actually had a CEO tell me once that he encourages and perpetuates information silos because that way, he’s the only guy who understands how it all fits together, thereby making his managers less likely to challenge any of his decisions. Really!
However, in most cases, these information silos exist due to benign neglect . . . the company just hasn’t established and maintained clear channels of communication up, down, and across the organization. You may feel you have those channels of communication well entrenched, but do you? Are you sure? If you asked a random sample of employees how often they feel blindsided by activities in another functional area that impacts their work, what do you think they would tell you?
Particularly in smaller organizations, the communications issue can be handled quite simply. I know of one company that holds a management team meeting every Monday morning at 8:00 a.m. It’s literally a standing meeting . . . no one sits because the meeting ends promptly at 8:15. The only purpose of this particular meeting is to give each manager an opportunity to inform the rest of the team what to expect from his or her area of responsibility during the coming week. Notes from the “standing meeting” are posted in each department so everybody else knows what to expect for the week. Again, the Doctrine of No Surprises. If the Accounting Department is going to be installing an upgrade to our accounting software, tell us. If the Production Department is going to be working overtime to process an unusually large order, tell us. If the Marketing Department will be rolling out a new sales initiative, tell us. Even if you don’t think what you’re doing will impact the rest of us, tell us. You get the idea.
Maybe the “standing meeting” approach doesn’t work for you and that’s OK. There are lots of ways to skin this particular cat. The important thing is to find communications channels that work for you, install disciplines so those channels are kept alive and well, and make the Doctrine of No Surprises a hallmark of your culture.
