Overcoming Silos – The Enemy of Digital Transformation

Organizational silos, the archenemy of productivity and innovation, is the foremost cause of stalling an organization’s digital transformation efforts. The modus operandi that silos advocate is regressive and not in line with the needs of the digital era we are in. Silos represent misaligned department goals that are known to spread inconsistent information to customers, resulting in a clouded brand message. Silos promote compartmentalization of a business into several departments with their own individual objectives, while excluding one another. This phenomenon is referred to as the silo mentality. These departments are often unaware of each other’s goals, methods, plans and/or target audience. Recent studies have revealed that businesses modelled around the silo mentality eventually deteriorate customer experience and impede innovation.

How to Assess if Your Business Suffers a Silo Mentality?

The following five characteristics indicate if a business is in the grip of silos:

  1. Inability to scale

    If implementation of new ideas is often met with failures, silos are usually the underlying problem.

  2. Inconsistent messages to customers

    Lack of alignment amongst departments is known to spread varying and inconsistent information to customers. This results in a clouded brand image and messaging, creating doubts about business integrity.

  3. Lack of employee loyalty

    Employees are not motivated nor do they breed a sense of connection with the business and are also not aligned to the larger business objective.

  4. Silo rivalry

    Department rivalry is evident and they drive their strategies towards short term department goals.

  5. Time-consuming manual reporting

    There is a significant dependence on manual processes leading to errors and  inaccuracies, which negatively impact customer relationships.

Breaking down silos is not about removing departments or unifying them under one umbrella, but about eliminating friction and conflict that hinders the flow of information and communication. Restructuring and reshaping parts of the business or consolidating departments can enable a collaborative operation.

The dominant role of collaboration in digital transformation success has been recognized for some time now. More recently, an article by KPMG discusses the complexity of the type of collaboration that is needed for successful digital transformation. According to the article, the strategic way of running an agile business can succeed only when it is supported by a modern collaboration infrastructure or platform that scales across borders, seamlessly integrating both alliance partners and clients.

However, it’s about time, we recognize that silos are arguably the single most important barrier to collaboration. In this blog, we have identified the 3 types of silos that impede an organization’s transformation journey and how breaking down these silos can make your business future ready in these unprecedented and dynamic times.

They are:

  1. Departmental silos: As organizations rely on individual department legacy systems, each department is motivated to focus on its core responsibilities and functions in isolation and at the exclusion of others, rather than sharing and collaborating. Departmental silos are bad for business. They obstruct personalization and value creation for customers.

  2. Data silos: Data silos represent an equally significant barrier to success with digital transformation. Organizations must have a 360-degree view of the data they are collecting to enable data driven business strategies. If data is available only in silos, it inhibits the big picture. Data silos are a serious business problem. Companies need an automated process of collecting and sharing data to build competitive advantage and a deeper relationship with customers. Breaking down data silos enables more effective decision makingand increased chances of success with digital transformation.
  1. Technology silos: In general, each technology silo has its own monitoring process and are not integrated to share information, creating an environment of disparate systems within an organization. Allowing implementation of automation and advanced analytics can be a critical step in meeting the collective goals of these disparate systems in realizing a continuous delivery pipeline/practice. Combining technologies for optimum impact can help streamline data sources and efficiencies. For instance, combining process mining, robotic process automation (RPA), artificial intelligence (AI) and machine learning can help break down these technology silos. Thus, it is important that technology tools be a unifying force across silos instead of being barriers to cross-functional collaboration.

In sum, departmental silos are bad for business. They stand in the way of the type of collaboration needed to create value for customers. Data silos and technology silos also stand in the way of digital business success. Business and technology leaders are fast realizing the importance of breaking down these silos for a digital ready future.  

Let’s take a look at how breaking down silos can build an organization for the digital age.

  • Helps build a common vision for the business and directing collective efforts to the end business goal
  • A unified data platform enables efficiencies, while disparate systems result in too many manual processes
  • It allows a 360-degree view of the business and builds stronger relationships with customers
  • Siloed systems reduce efficiency and collaboration, while a single data hub streamlines workflows
  • Getting rid of silos empowers a business to gain competitive edge and deliver a supreme customer experience
  • It also promotes companywide analytics and data driven strategies

As we know, innovation is the only way forward and a necessary one to improve customer retention and expansion. Creating an agile and connected ecosystem that is digitally enabled and capable of responding and managing disruption in real-time, is the key to attain competitive advantage. This digital disruption is profoundly rewriting today’s business environment and ecosystems. The only way to keep ahead or stay on par with the competition in this rapidly changing landscape is to take a digital first business approach. Digital transformation and the rise of big data usage across diverse sectors of the economy empower organizations with a scalable and predictable revenue engine that enables improved financial management and sustained profits. 

Though digitization drives transaction costs down significantly by saving both time and cost, the many businesses operating in silos, face accounting discrepancies that need to be aligned. By adopting a platform like RecVue, during a digital transformation initiative, it can be a game-changer in terms of leveraging technology and automation to deliver performance optimization, as well as cost and time savings. RecVue’s unified platform integrates with any ERP, CRM and front-end order processing systems, enabling customers to improve efficiencies across order-to-cash, revenue and general accounting, while gaining real-time access to data. Finance groups are able to increase accuracy and timeliness of billing and invoicing and aggregate billing information in a single system to improve analysis and forecasting. RecVue’s monetization platform includes a 360-degree view into the entire contract lifecycle, rules-based attribute pricing, complete order-to-invoice capabilities, pay-side management for third party obligations, and robust analytics and reporting.

Contact us today to learn how RecVue’s monetization platform can help you on your transformation journey. Make your business future proof and digital ready!

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