Why it's not always optimal to have organizational silos

Organizations of various types have over time become increasingly efficient in their individual parts while simultaneously functioning less well as a whole. For a long time, specialization, divided responsibilities, and separate budgets have contributed to a working method where each function develops its own goals, priorities, and processes. Silos are emerging, often without any explicit decision-making. What is rational for one department then does not have to be right for the organization. Resources are suboptimizing, expertise is tied into parallel initiatives, and dependencies between business areas remain invisible. At the core of the problem is that the responsibility for the parts is clear, while the responsibility for the interplay between them is unclear. When no one has a stated mission and mandate to coordinate the whole, cross-functional issues risk falling between organizational boundaries. At the same time, the management function is burdened with operational decisions, recurring reconciliations, and competing change initiatives. The space for strategic analysis, common priorities, and long-term development is shrinking. The organization becomes preoccupied with its own administration rather than with the value it is meant to create. Thus, the ability to view the business from a broader perspective is also weakened. Customers, citizens, and partners encounter a coherent organization, but are often referred between internal functions with different perspectives and responsibilities. Their needs risk being subordinated to the organizational structure, internal routines, and local performance metrics. The business becomes increasingly inward-looking, despite its relevance being determined by the external environment. Therefore, breaking silo thinking is not primarily about more meetings or additional coordination requirements. It is about giving the holistic perspective a clear place in governance, making common resource needs visible, and reconciling the responsibilities of the functions with the organization’s overall mission. Only then can internal efficiency be translated into actual business benefits and management gain better conditions to lead the entire organization, not just its parts.

The consequences will be, among other things:

• Suboptimization of resources and competencies.
• Double work between departments.
• Slow decision-making processes.
• Impaired customer and citizen experience.
• Unclear division of responsibilities for cross-functional issues.
• Lack of innovation ability.
• Difficulties in prioritizing based on the overall needs of the business.

The underlying reason is often that no one has an explicit mandate to represent the whole. Management teams tend to represent organizational parts rather than value flows, customers, or the overall results of the business. The organization thus becomes inward-looking and is governed by internal logic rather than external demand.

Desired location:

• The whole becomes a defined and controlled responsibility domain.
• Decisions are made based on operational benefit rather than departmental benefit.
• The customer, citizen or market perspective is integrated into the governance.
• Common resources are optimized across organizational boundaries.
• Cross-functional collaboration becomes the norm instead of the exception.
• The organization’s focus shifts from being inward-looking (introspective) to focusing on customer value (extrospective).

Knowledge areas that are required or need to be utilized

Additional area: Chief of Staff function

Especially in the case of siloprosblems, this area is particularly relevant as it involves establishing an organizational function whose primary mission is to coordinate, prioritize, and represent the holistic perspective.

Proposal for a solution in the short term

1. Establish a ”Holistic Forum”. A cross-functional steering forum is established directly under the CEO, the general director or the highest management. Purpose:

• Manage issues that span across multiple organizational areas.
• Prioritize resources from an organizational perspective.
• Identify conflicts between local and common goals.

Composition:

• CEO/General Manager
• Chief of Staff
• Business/Operational Managers
• HR
• Economy
• IT
• Operational activities

2. Map the organization from the outside-in. Instead of starting from the organizational chart, the following is mapped out:

• Customer travel
• Citizenship travel
• Service flows
• Delivery flows
• Business processes

The result is visible:

• Where customers are lost.
• When waiting times arise.
• Where responsibility falls between the chairs.
• Where resources are being used in a double-use manner.

3. Introduction of common KPIs. A common silo symptom is that each department measures its own goals. Example:

At least 30-50 % of the goals of the management team should be common.

4. Add a Chief of Staff. The organization needs a function with the mandate to:

• Coordinate the work of the management group.
• Ensure cross-functional collaboration.
• Highlight organizational dependencies.
• Drive strategic priorities.
• To be the ”owner of the whole”.

The Chief of Staff is not meant to replace line managers but to complement them.

5. Make resource use visible. Through portfolio management, a comprehensive picture is created of:

• Project
• Initiatives
• Improvement work
• Development resources

Many organizations discover that the same specialist is used in 5-10 initiatives simultaneously without central coordination.

Proposal for a long-term solution

Vision: From a function organization to a value flow organization

The long-term solution is not to eliminate specialist functions but to supplement them with governance based on value flows. The organization gains two perspectives:

Vertical responsibility

• Competence
• Personnel
• Budget
• Methods

Horizontal responsibility

• Customer benefit
• Delivery capability
• Business results
• Value flows

Create a permanent strategic coordination function. Example:

• Chief of Staff Office
• Strategy Office
• Enterprise Transformation Office

Responsibility:

• Strategic coordination
• Change portfolio
• Priorities
• Management support
• Organizational analysis

Towards overall responsibility in the management team. Each member shall:

• Take responsibility for your area.
• Responsible for the entire performance of the business.

Bonus models, goals and follow-up must reflect this.

Establish continuous organizational diagnostics. At least twice a year, an analysis is carried out of:

• Cooperation patterns
• Speed of decision-making
• Customer experience
• Internal dependencies
• Resource load

In this way, new silos are discovered before they become permanent.

Responsibility and Drive (RACI)

Explanation

• R = Responsible (carrying out the work)
• A = Accountable (extremely responsible)
• C = Consulted (consulted)
• I = Informed (informed)

The key principle is that The whole must have a named owner. Without this, the silo mentality will resurge.

Need for consultants

Consultants should only be used where the organization lacks expertise or needs external objectivity.

It is important that the consul’s mission includes knowledge transfer and ends when the organization itself can drive the capability.

Summary and short action plan

The core of the solution is not more meetings or new processes. The core is to create a permanent and clear mandate for someone to own, coordinate, and develop the whole thing. In many organizations, a strong Chief of Staff function is precisely the missing link between strategy, leadership, and operational reality.

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Rolf Olsson Partner

Rolf Olsson is one of the founders of Chief of Staff Platform and specialist in business transformation, strategy implementation, and management support. Rolf has worked more than 40,000 hours as a consultant and writes about how the Chief of Staff role, modern governance, AI, and change management can help organizations increase their execution capabilities and create sustainable business results. Rolf has a degree in civil engineering, a master's degree in IT Management, and a PhD in Computer Science. Comments or remarks on this article can be emailed to: glossary@chiefofstaff.se

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