Have you ever bought something from a company and the process just felt too difficult to buy it? Chances are that you’ve come across a business where the purchase journey was too clogged up by their own internal processes and communication.
For example, imagine walking into an electronics store excited to buy a new TV. You’ve got your hard earned money in hand and you’ve spent some time checking online reviews for leading TV brands in your price range, narrowing it down to the perfect set for you. You brave the traffic, find a car park and walk into the store. A helpful sales assistant is happy to assist and he is off to get you that TV. But first, they have to check with the warehouse team if your item is in stock. The warehouse manager needs to redirect a team member from their current task, to look up the stock item in the inventory system, which is looked after by the IT team.
After waiting what it seems like an endless amount of time for them to track one down, it’s not in stock. The assistant then needs to call another store in the area and repeat the search process. Finally, the perfect TV is found, but it’s now Saturday afternoon and it’s nearing the time to close up for the day. The dispatch team, controlled by a different manager, won’t have enough time to process your order and place it with a courier for next day delivery. Your TV is now days away and the weekend will have to go by without your favourite entertainment.
You may wonder if a better solution would be just to walk over to a competing store and see if they have stock at hand.
It’s only when all of the business units are efficient and syncing well operationally that the customer will walk away satisfied with their purchase.
Importance of silos
Silos are business units which specialise in a particular function in the wider organisation. They provide crucial structure to companies, allowing accountability and responsibility to sit with a particular business arm. Amazon’s Jeff Bezos famously said that teams should be small enough to be fed by 2 pizzas - an analogy which speaks to a team being streamlined enough to be agile, but also embodies pride of ownership and some autonomy of its business function.
There is no question about the importance of siloed structure to many businesses, rather than unifying everything into a strictly horizontal structure where the boundaries or responsibility are blurred. You wouldn’t expect your sales assistant to know your inventory and dispatch systems inside out - you expect them to be great at their own function, in their case - sales and customer service.
Risks with silos
The greatest liability of siloed business units is customer churn, caused by the lack of alignment in the organisation.
Non-aligned teams can be detrimental to both the internal and external customer. Lack of communication and misaligned or competing priorities contribute to a difficult customer journey. They can also be an ineffective, frustrating place to work. In the example above, if the warehouse team was measured strictly on the efficiency of say, putting away inwards goods, they might be too busy to chase an individual item for a customer. This would be incredibly frustrating for the customer as well as the floor sales team.
Making silos work for you
The key elements to aligning business units are to be cooperative, to collaborate and achieve the best outcomes for the customer, and to communicate effectively across the organisational structure.
As unit managers are in charge of their own silo, it's natural for them to want to control their unit, see it function well and meet its targets. The common concern for the silo managers would be a vertical, top-down one. The shift needs to be applied to the focus and knowledge sharing among different business units, horizontally across the company structure.
In the case of our TV sales assistant, imagine if they had a system that guaranteed you next day delivery, no matter where in the country you are, without having to wait in-store while the employees search for a solution. In retail particularly, brands need to inform customers if items are in stock at their location or guarantee a delivery within a certain time frame, removing friction in their buying journey.
Customer council
One of the best ways to break down the closed nature of organisational silos is to link units in a customer-focused forum - Customer Council. The council idea brings together heads of different departments who impact the customer experience. They can show commitment to improving customer experiences and drive the necessary changes through their respective departments.
Customer council gives the separate units opportunity to communicate about the impact of changes on their teams, but also explore any dependencies that CX initiatives will have on each silo. These challenges are much easier to overcome in a cooperative, communicative environment. Councils need to address customer feedback regarding their products, company and operational issues, review marketing and sales messaging as well as industry, market and competitor intelligence.
It is no longer enough for customer experiences to be convenient. Customers today require personalised, frictionless experiences. According to Forrester Research, frictionless means that “customers expect any desired information or service to be available, on any appropriate device, in context, at their precise moment of need.” In order to predict and preempt customer demands, business needs to pay close attention to their customer feedback across all channels.
Using and sharing this data between silos enables the different teams to be proactive by initiating customer drivers as opposed to reactively troubleshooting issues as they arise from customers.
For a deeper look into how you can embed a customer feedback strategy in your business, download our free eBook '5 step guide to Implementing customer feedback' (below):
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