If companies want to be relevant and grow their future business, they need to become better in designing Customer Experiences. And to do that, they need to dissolve the Silo mentality that hinders innovation and collaboration.
When members of a team see only their own reality, they are caught in their own way of thinking. They set up rigid categories, and both deliberately and unconsciously do everything they can to fit all they experience and do into those comfortable categories. Processes are enforced for the sake of the process, the internal equilibrium is more important than what the customer needs. This leads to stagnation, no innovation and for sure, the customer will feel that the service is not designed with their needs in mind.
Organizations must escape the trap of “Silo” mentality, because only then will they be able to re-define the role they play for customers, and elevate the Customer’s Experience.
Companies are too often fragmented constructs of specialized Products or Services, who are responsible for their own bottom lines. Additionally, they are often excessively proud about their size, their expertise and their rich heritage, They easily become a company within the Company.
Even departments that are supposed to work cross-functionally are frequently building boundaries and processes that enforce their own identity. They also become “Silos”.
For some, it has worked well in the past. But this Silo mentality is now becoming an obstacle for innovation and great customer experiences.
“Siloed” organizations are often lacking common understanding and alignment that is important for innovative organizations. The level of coordination between entities and people is suboptimal, collaboration is lower, the number of misunderstandings is high and the performance sinks below it’s real potential. Many companies do not even realize that they are on a downward slope, seeing their current good financial performance as an indicator of future success.
Have you noticed the paradox of people that complain about the Silo thinking in their companies? They are surprisingly accurate in the way they point out the negative effects. However, these complaints are always about the Silos that people are not part of themselves, as people tend to only see the Silos that limit or threaten them.
Silo mentality excludes rather than includes people. It prevents important questions from being asked, it delays innovation and it blocks holistic approaches.
How to Recognize Desctructive Silos.
J.H. Gittel and her colleagues are doing some great work and research on the topic of “Relational Coordination”. In the below table, we have listed the questions from her published survey, as these can easily be used in a cross-functional workshop, initiating a urgently needed discussion about how much the organization is infected and impacted by silo mentality.
But silos are so comfortable to be in. Often they work really well for the people in the Silo, and who wants to be the “sore thumb that sticks out”? Who has the courage to ask the uncomfortable questions that disrupt and challenge status quo?
Here are 4 questions that help companies to innovate and to bust or bridge silos:
1. What do your customers say that they need in future?
Let’s be open on this: Did your company even ask? Most companies at best get input from a few important customers, and fail to start a structured survey and to evaluate the responses. This leaves the company in the dark about the future customer needs– so how can a company innovate in a meaningful way and create great customer experiences?
2. How do you define “Customer Experience” in your organization?
It is not the same as “service quality”, which is focusing on the transactional quality of the process: Is the shipment on time, are the products meeting the required quality standards and did we follow the process without failure?
Customer Experience is about which emotions the customer feels before, during and after the service. If the service agent provides good advise and displays a positive spirit, then the customer may in fact have a positive experience even though the delivery was slightly delayed.
The Customer Experience starts much earlier than the actual transaction, and is a continuous journey that is multiplied during all aspects of the Sales, Operation, Improvement and even the discontinuation the relationship.
It is possible to be very intentional about designing the experience of the customer, to design what emotions and thoughts you want to achieve in the customer relationship. Cross-functional workshops can be established around the following Experience Design template:
3. How would you organize your company, if the customer would only pay if they experience a positive emotion during the service delivery?
Imagine that you are now reaching a level where you are prepared to guarantee that the customer will experience positive emotions. Then you are operating on a completely different level, and will develop loyal customer relationships and create new commercial opportunities.
In a study by Temkin (2017) it was identified that70% of customers report that the service was a ‘success’. 58% even described the service as ‘good’, but only 7% said that there was a ‘good emotion’ involved in the service. At the same time, Bain researched that it costs 6–7 times more to acquire a new customer than retain an existing one. So, give you customers some real love.
4. What are the internal signals, rituals and habits that enforce the power of Silos?
Some companies operate with so-called “codes” that describes a person’s department, location and role. The codes are even used in exchange of a person’s real name; “The RS wants to see you” (Translation:“The regional boss of sales wants to see you”). This is problematic on two levels, as it enforces the belonging to a certain Silo, and it is also a dehumanized way of communication. We cannot expect that employees create personal binds with a “Code”. By using names instead of codes, companies can abandon excessive process and silo thinking, and enable better human connections.
If you want to identify signals, rituals and habits that create mental barriers and enforce silos, put up a Mailbox in the office and ask employees to submit small notes with what they think is disturbing. You will be surprised how much input you get
Silo mentality is poison for employees and customers alike. It prevents employees from engaging wholeheartedly, the customer feel that something is missing and Status Quo is protected to the point of stagnation.
“Specialization” is Not Necessarily a Silo.
The ability to dive deep into a topic and come up with solutions, is of course a very important trait. It makes no sense to have a generalist develop detailed innovative solutions. But maybe the specialist teams/departments/divisions could be designed and established in a different way. A way that is focusing on what the customer needs, rather than how the service provider prefers to organize the service delivery.
Flip the focus to the customer, and build products and services that give the customer a great experience. Forget about your internal conformity and process protection.