Thursday, October 22, 2015

Rising to the Occasion of Corporate Silos

I attend a lot of trade organization conferences, and not even for the same trade.  It’s all over the map, really— from child support, to government finance, to merchant services.  When you have the opportunity to attend so many conferences of such a wide variety, it becomes clear that many organizations share the same challenge of effective communication or lack thereof.  I’ll give you an example. 

I recently had the distinct pleasure of attending the Money Transmitter Regulatory Association conference in Kansas City, Missouri.  Sounds dull, right?  But, turns out, this industry has the same problems as other industries; and it struck me loud and clear when I heard a particular sessionI attended a session lead by Heidi Wicker Partner,  Schwartz and Ballen LLP and Craig Timm, Deputy Chief, Asset Forfeiture and Money Laundering Section, U.S. Department of Justice.  While their topic was on eCommerce compliance, the conversation turned to corporate communication.  As in many companies, areas such as banking, compliance, marketing, and operations are often siloed and therefore struggle with or lack needed communication.

This lack of communication leads to a lack of accountability and in the case of a money transmitter, can cause big legal problems, including possible state and/or federal prosecution.  It isn't good enough to say that the non compliance was reported, rather management has an obligation to react appropriately and timely.  Ignoring the problem is not an option in the world of government regulation.  And silos within the company can mask the problems,  making them insurmountable when finally exposed.

Internet Photo

In many companies, the silo effect is a natural evolution of any organization that is expanding and adding new divisions, bureaus or departments. As the organization expands, it often relies on communication practices that have slowly become obsolete and ineffective. This can sometimes be exacerbated by the limited subject matter that the employee(s) are focused upon in each division.  Another major cause of siloed communication is unhealthy culture development within the organization, a culture promotes defensive behavior about sharing ideas, responsibility, and accountability - which ultimately leads to infighting and turf wars.  This kind of silo is particularly difficult to tackle as the parties are usually wary of change, as change can represent losing control of the turf they are protecting and view the desire to change as a threat of power or control.  In the case of regulatory compliance, they would be right.

It does seem ironic that these kinds of problems don't surface in audits or management discussions, but it is quite natural that they are concealed.  If the main goal is to protect the status quo and keep things the same, then revealing information that could lead to change- even if for the better- is still a threat.

So how does a company change from the silo effect to a collaborative effect?  Strong leadership by example.  It has to come from the top and it has to have teeth.  Bringing in a one time communications or organization consultant and singing kumbaya for two hours in a "retreat" will not suffice.  That will vanish as soon as the team return to the office.  Nope, this has to be a  good old fashioned hand wringing upset of the structure.  Can you keep the existing managers in place and instill a new spirit of collaboration?  Perhaps, but in order for it to work, the managers need to develop empathy for each others goals, strategies, plans and corporate place.  The best way to do that is to reassign the managers to new areas for a time period.

"What did you just say?" I heard.  Yes, reassign them.  Put the Compliance Manager over the Governmental Affairs office.  Put the CFO over IT and put the Communications Manager over Accounting.  For three months or at least one month.  Same performance standards and goals.  Make them feel the empathy for the other staff and what the other manager must deal with day to day.  Take away the protectionist mindset, the isolating circle the wagons approach, and have the managers learn to work with a whole new crew.


So how does a company change from a silo culture to a one that supports the collaborative culture?  Before we can answer that question, we must first answer the question, “What is culture?”   A healthy organizational culture is a result of strong leadership by example.  Yes, it’s that simple. Its not what leadership says they do, it is what they actually do and these actions affect everyone in the organization, no matter how big or small.   The best way to start is to take a hard look at the current roles each leader and department manager is in. Often, an unhealthy culture has nothing to do with the employees themselves, but much more to do with whether or not they are best suited for the role they are in. That IT Manager that is always chiming in on issues in the Government Affairs Department, but is seemingly uncaring about issues that directly affect the IT Department, is telling you something through their actions or lack thereof.  So, reassign based on their actions, not their words or current title!

I know it sounds crazy.  But, what if it works?  What if the CFO learns more about the company by running IT?  What if the Communications Manager becomes more effective at corporate presentations because of what he or she learned in finance?  What if we did the same thing with middle managers?

And what if they all started having more respect for each other and wanting to protect the entire company, versus just their division.  PollyAnna.  I know.  But people are basically the same and if they are put into the situation to develop empathy, if they are given a new chance to grow and if they are supported through the process, it could change the culture.

No one likes drama in the workplace.  No one wants to work for a culture of protectionism and defensiveness.  True change in communication and collaboration doesn't come from taking classes or learning to tweet. True communication comes from trust and respect.

Ironically enough, as I write this, another industry enews sends a link on collaboration.  It is Collaboration Begins With You  a new book by Ken Blanchard, Jane Ripley and Eunice Parisi-Carew.  Their site states, "Collaboration Begins with You helps leaders at all levels create and develop a culture that uses differences to spur contribution and creativity; provides a safe, trusting environment; involves everyone in creating a sense of purpose, values, and goals; encourages the sharing of information; and turns everyone into an empowered self-leader."  I can't wait to get my order in for the book.  In my world, it is essential to ensure collaboration.

In the world of regulatory compliance, it is not just about communication and collaboration, it is about following the spirit and letter of the law.

(#KCMO is a wonderful place to visit.  I was pleasantly surprised at all the things to do!)