How Silos Stifle Workplace Collaboration

By George Waggott, founder, and Roberto Fonseca-Velazquez, law student

George Waggott Law

A recent article published by the Harvard Business Review reviews the negative impact that the “silo effect” has on business organizations. The silo effect, which is defined as the lack of communication and collaboration between specialized departments within organizations, remains a persistent issue for many workplaces. Research shows its widespread impact: a Salesforce study found that 70% of customer experience professionals see silos as the greatest obstacle to effective service, while a Harvard Business Review survey attributes 67% of collaboration failures to the silo effect. As early as 2002, the American Management Association noted that 83% of executives acknowledged silos in their organizations, with nearly all reporting negative outcomes.

Despite various efforts to address this problem—such as forming cross-functional teams and investing in collaboration technologies—many initiatives aimed at eliminating silos fail. This is because the silo effect is often treated as a single issue rather than a symptom of distinct underlying problems. The recent HBR article describes three categories of silo: systemic, elitist, and protectionist, and illustrates the features of each type of silo by discussing real-world companies that the authors have worked with.

Systemic silos emerge when departments prioritize their own goals over the organization’s broader mission, often due to misaligned incentive structures. At Goal-Diff Beverage Co., a tea retailer, the sales team’s focus on volume over profitability, and lack of coordination with manufacturing, lead to inefficiencies and cost overruns. Systemic silos are difficult to recognize because the relevant internal goals may have once been effective but no longer align with current business complexities and conditions. Patterns such as frequent escalations within the organization, inter-departmental tension, and blame-shifting are characteristic of systemic silos.

Elitist silos form when departments perceive themselves as more knowledgeable or important than the rest of the organization. These groups therefore choose to restrict information flows to maintain control within their silo. At EliteMed Pharma Co., the R&D department had withheld essential lab process details from the process design team, assuming that the design team lacked the expertise to understand them. This resulted in inefficiencies and morale issues. Elitist silos can be difficult to identify because often the elitist department will function well, and all the disruption will occur in departments that rely on the elitist department. In other words, there may be specialization or expertise which justifies some level of self-selection or exclusion from some functions, which may then clash with organizational objectives.

Protectionist silos occur when teams deliberately withhold information to safeguard their autonomy or perceived value. At ProtectParts Inc., an old facility resisted automation and data transparency out of fear that closer scrutiny and the exposure of the high costs and inefficient production processes in the facility would lead to its closure. These protectionist silos are often masked by excessive but non-substantive communication and delays in decision-making, signaling a lack of trust and a desire for self-preservation.

To dismantle all types of silos, the authors argue that management must first correctly diagnose the root cause and then apply targeted strategies:

• Aligning goals addresses systemic silos by ensuring departments work toward shared objectives. Tools like Sales and Operations Planning (S&OP) can harmonize sales and production efforts.

• Improving communication targets elitist silos through job rotations and cross-functional teams that build mutual respect and understanding.

• Fostering secure data sharing counters protectionist silos by creating a culture of trust and psychological safety, where transparency is rewarded and not penalized.

  
  

In conclusion, just as effective medical treatment depends on accurate diagnosis, overcoming the silo effect requires identifying its specific root causes and applying precise interventions. While temporary fixes may ease immediate dysfunction, only targeted, long-term strategies can sustainably improve collaboration and organizational performance.

For more information about George Waggott Law, please see: www.georgewaggott.com, or contact: george@georgewaggott.com