Silos Are Good for Grain, Bad for Information

Nancy Roberts

In a recent article in the Harvard Business Review, Michael Porter and Mark Kramer point to a new vision for a corporation. They write:

“The purpose of the corporation must be redefined as creating shared value, not just profit, per se. This will drive the next wave of innovation and productivity growth in the global economy. It will also reshape capitalism and its relationship to society. Perhaps most important of all, learning how to create shared value is our best chance to legitimize business again.”

The creation of shared value can only start within a framework of open, transparent and fearlessly shared knowledge. Yet we have all seen the phenomenon of knowledge hoarding in silos:

  • Data is disguised because it might displease a cranky boss while a deadline looms
  • Information is hidden because it indicates a safety glitch that you think you can fix before anyone notices
  • Knowledge is sequestered until you can unveil it and “save the day” at the quarterly meeting
  • Wisdom, even wisdom, is sometimes held in check because a leader does not want to appear weak or uncertain about not having the one right answer

A company that is not consciously creating a comfortable atmosphere for sharing information across silos is neglecting a tremendous asset: the knowledge that lives in its people.

It is also overlooking the opportunities that better wisdom-sharing creates, as Chip Pitts, former chief legal officer for Nokia Inc., pointed out in a recent article:

“CSR starts with a commitment to ‘integrated decision-making’ i.e. systemic thinking, that sees the interrelationships between top global issues, stakeholders, corporate departments and previously segregated roles of individuals.”
How is wisdom shared across and among the silos at your company? Is it horizontal or vertical or both?

Is your leadership aware of the ideas and knowledge of all your stakeholders? Do you have a handle on all the innovations and risks that could radically change your industry in the next ten years?

About Nancy Roberts

Nancy Roberts is a partner and co-founder of The Idea Hive, and an adjunct faculty member at Dominican University of California’s Green MBA program. You can follow her on Twitter at @leapingotter.

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5 Comments
  1. Rick Lebherz

    February 15, 2011

    I help companies with Environmental compliance and data management systems, and this is very true. Its amazing how ignorant some departments are of what another area is doing that would benefit them. One of our larger customers to remain nameless has 4 systems from 4 vendors that do the same thing in 4 different divisions. It really makes me wonder why corporations don’t invest in group think and knowledge control more. I also wonder if the inverted pyramid and flip of knowledge is a good thing if the benefits from that shift are not expanded upon.

    • Sam Waldo

      February 18, 2011

      Rick,
      I must respectfully disagree with your premise that “group think and knowledge control” will lead to a more effective corporation. While I wholeheartedly agree that an insular approach to knowledge retention has a detrimental effect, the communalization of knowledge can just as easily stifle innovation as foster it (I actually think it is more likely to do the former).

      It would seem to be much more appropriate to work toward instilling a common Corporate Ethos, under which each operating unit has the freedom to find its own way. There is room here for commonality and independence while striving for the creation of shared value that Nancy described.

  2. William D'Alessandro

    February 14, 2011

    I am befuddled by this blog. Can you restate what the point is for stupid me?

  3. Nancy Roberts

    February 14, 2011

    HI, William,
    It’s not very deep, I’m afraid. :) I was hoping to point out that often the information we need to do our best work as an organization is right in front of us. We sometimes close ourselves in silos of expertise or specialty or hierarchy to the detriment of the whole.

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