A data silo, also known as an information silo, is a collection of information that is not accessible to every part of the organization.
The gist is that it is limited to some specific groups or individuals. Thus, they’re said to be siloed from the rest of the organization.
Now, a general idea you may get from searching data silos on the web is that they’re a really harmful practice. But, let’s not term it something before we understand it completely.
Normally, most organizations stem from a hierarchy system, where individuals are separated into departments. These departments are responsible for their own goals. And have to report their progress to the higher authorities.
Data Silo in an Organization
In an organization, let us consider a marketing team, that will be completing their own targets without looking at others. In such a situation, the data starts accumulating with time.
And before you know, you have an entire data silo that is invisible to the other teams. It’s important to note that in the same way, the other teams will also have their respective data silos, which they won’t be sharing with others.
This practice, although allows each team to have its own goals and targets, yet can also harm the organization in coordinating decisions.
Just consider that the marketing team is about to close a five-year deal with a huge firm. The decision will be a probable success in the long term, but the company will have to be patient in the first few years.
In such a case, the deal cannot be finalized until we have all the data from the Finance team. In the case of data silo in an organization, the marketing team is completely unaware of the complexities in finance. And thus, will not be able to pick out the best route for the organization.
5 Ways Data Silos Can Be Bad for Your Organization
1. Limits the View
In the case of data silo, the siloed data is limited to where it has been created. This actually divides the organization into groups and prevents them from looking between the lines.
For example, if the management team has some data that can help understand where the organization lacked in their previous campaigns. They can actually discuss it with the marketing team, so as to give them an idea of what should work this time around.
2. A Slow Process
The only way the data can be shared within the organization is if it’s transferred from one group to another. In such a case, the other group reviews the data and concludes its finding to another group.
Which then again has to review to highlight the points of their focus. This way, the transfer of data through data silos is a very slow and hectic process.
And in some instances, the data cannot be well interpreted and communicated. Thus, resulting in a loss of some information.
3. Waste of Resources
When your organization is working in data silos, each team will have its own data silo which will be different from the data silo in the next team.
These silos might have some recurring data, that can help more than two teams. Thus, to store such data again and again just to create separate roles will require greater space and resources. The organization would have to spend their time and money on a system that already occurs.
4. Data Silo Discourages Teamwork
In a system of data silos, each employee is only answerable for the data of his team. This culture creates a workplace gap between the different departments.
The employees feel restrained to communicate the progress or findings of their teams. This gap destroys the teamwork within the organization. And creates a sense of unhealthy competition between the different departments.
5. Structural Loopholes
The hierarchy system often separates the different departments. The employees within these departments feel only answerable to their own management.
This hurts the organizational unit, as a whole. Further, it also differentiates the work ethic. For instance, software used by the marketing team to collect data regarding their previous campaigns may not be supported by the finance team.
They may prefer a separate software, thus complicating the transfer of data from one data silo to another.
Data Silo: Conclusion
Many companies realize the harms of data silos. And want to get rid of them to preserve their institutional integrity. But the answer isn’t that simple.
To agree is one thing; to implement is another. Breaking down these data silos can be a severe headache. You will have to ask your employees to shift their entire work ethic.
This process can go on for years before you’ve entirely switched to collecting data on a single data warehouse. The data warehouse concept is considered much better, as it can help the organization to create a single pool of usable data.