Organisational Silos And Customer Experience

by | Oct 14, 2021 | Customer Experience

It’s already common knowledge that for business to succeed, it is essential to deliver an exceptional customer experience. But what makes for a winning customer experience? Experts agree that integrating customer-centricity as a core philosophy in your business, and delivering consistent, personalised experiences are some of the key elements to CX success. The problem is that many companies today have adopted a rather siloed existence. Why is that a problem, you ask? Well, organisational silos are killing customer experience.

Advantages Of Organisational Silos

There are definite advantages to having independent business units.

These include:

Positive workplace relationships – Trust and connections develop among employees within the same silo. This facilitates intergroup conflict resolution.

Effective communication – silos create a common space for effective collaboration and communication, and problem solving to achieve objectives within the business unit.

Increased productivity – collaboration and communication among employees of the same silo drive motivation to increase productivity and deliver high quality outputs.

Direction and Focus – common goals and common thinking of silo members provides a focused framework to achieve objectives regarding specific business deliverables.

Support network – like minded individuals have a similar outlook regarding organisational functions.

Sense of belonging – organisational subcultures provide a sense of belonging especially in large corporations where one might otherwise feel lost or disconnected.

Disadvantages Of Organisational Silos

Many of the above-mentioned advantages are aspects that should rather be tackled within the employee experience framework and driven by the overall corporate culture.

The downside to a siloed structure is hinted at in the very definition of organisational silos.

“Organizational silos refer to business divisions that operate independently and avoid sharing information. It also refers to businesses whose departments have silo system applications, in which information cannot be shared because of system limitations.” Investopedia

In most cases, silos spur behaviours that are beneficial to the tenants of the silo instead of serving the best interests of the overall business or its customers.

Restricts innovation

The success of many organisational functions requires the crossing over of silo boundaries. For example, innovation tasks. Essentially, for true innovation, one would need to draw on capabilities and ideas of different organisational units.

Hinders agility

Silos are linked to organisational structure. This works fine as long as markets, consumers, technology, socio-political situations and environments remain unchanged. However, when the need arises to adapt swiftly, siloed companies are often unprepared to pivot to accommodate sudden non-routine change. This was evident for many when the covid pandemic struck and the ramp up of digitisation.

Restructuring

Highly siloed companies have a harder time restructuring and operationalising change management solutions.

Lack of alignment

Silos restrict clarity of vision across the business. Each department cares only about its own success and not the success of the organisation as a whole. It also becomes difficult to set company goals as there is often a lack of alignment between the business unit goals and organisation goals. This results in a lack of collaboration and working together as a cohesive team, which in turn leads to poor decision-making.

Customer experience killer

Perhaps of most greatest importance is how organisational silos deplete the customer experience. Ensuring an optimal customer experience requires cooperation across functions, locations, and product/service units.

Organisational Silos And Customer Experience

“Silo mentality” is the biggest organizational hurdle to improving the customer experience. – Beyond Philosphy 2012.

The customer experience journey, from start to finish touches many parts of the company. When an organisation is siloed, it frequently presents mixed messages instead of speaking to the customer in a single unified voice. Each silo has its own view of the customer and its own voice. The company is not seamless and therefore, the experience to the customer is not seamless. The customer tends to perceive the organisation as disjointed. This corrodes the trust they have in the company being able to satisfy their need.

Silos generally develop for the benefit of the shareholders and employees with little consideration of the customer. They are about creating efficient systems and processes. This creates an inward focus. The result is that the very people for whom these systems are intended to service, are mostly forgotten.

In truth however, the customer expects the department they deal with to be empowered to look after them and manage the relationship in a professional, friendly, and appropriate manner. So instead of being empowered with efficient systems, customers want empowered with customer centricity.

The customer chooses to interact with your company as a means to a particular objective. They have very little interest or care about the internal structure of your organization. The customer sees you as a single entity irrespective of how many departments they need to go through. Although, this may dilute the experience especially if the experience is disjointed. Their expectation of your company is to deliver what they believe to be a consistent and personalized experience that satisfies their ultimate need. How you get that done is irrelevant to them. So long as they are treated as a humans and perceive to be understood and not inconvenienced by having to battle through non-coherent structures.

Furthermore, not all journeys with you require warm fuzzy empathetic interactions. Understanding that some journeys with your company are simply functional and frankly expected. For instance, banks promising that your money is safe with them is a promise no one actually needs to hear. It’s simply expected as a given.  

Breaking Down Silos

According to Bain, the new cycle of business has begun. Companies cannot continue as ostriches hiding behind process and internal metrics. Having a deep understanding of human need is critical to success.

So how do you begin to break down the silos?

Focus on the customer

Instead of organisations arranged around internal process, they should adopt a “pebble and pond” model – with the client being the catalyst for the concentric rings that surround the client, rather than high walled obstacle courses that clients are forced through to get what they need.

To do this, you need to bring your teams together to share customer feedback and demonstrate the inter-dependence of individual business units to meet customer expectations. You need to stay close to your customers and determine where you are meeting, exceeding or falling short of meeting their expectations.

Unified vision

Organisational leads must have a shared organisational goal and vision to guide the objectives of independent units. Company objectives and vision must be communicated across the organisation. It is essential that employees understand their role in the overall success of the business. Continual benchmarking and measurement of goals will maintain the focus and support the execution.

Teams and departments that are aligned both with each other and the overall company vision result in reduced acquisition costs, create better and more frequent customer experiences, and elevate Customer Lifetime Value.

Connect touch points and channels

Date gathered through various touch points along the journey must be captured and made accessible across all departments. Purchase behaviour data indicates that at least 60% of customers engage with three or more touchpoints before purchasing. Each touchpoint generates data to provide insights as to how a brand can further personalize the customer experience. In spite of this, 54% of companies measure customer experience and channel engagement as separate operational silos.

By integrating your channels and sharing touchpoint data, you will obtain a complete picture of your customer, where they are along the journey, and how your company is fairing in terms of meeting the customers’ needs. All employees will have access to relevant and accurate customer information which will enable better problem solving, decision-making and customer-servicing.

Collaboration and Communication

Create an environment where teamwork, collaboration, information-sharing and open communication are valued. This includes data captured from customer touchpoints along the customer journey. Bring together people from all relevant departments, locations, levels, and points of view. This will really allow the voice of the customer to be heard. All employees need to understand that they form part of the customer experience. No-one should be so divorced from the client that they can claim to be an “internal” person or have a purely “support function.” This simply means that they have failed to connect their role with the “why” of the client.

Reward

Rewards are generated on efficiency, but when one looks at the real view of churn, there is a different story being told. – One of clients voting with their wallets around chunky, process-centric organisations who value internal metrics in highly compartmentalized divisions, versus actively listening to what clients need now, and planning for what they would need in the future.

It’s better to measure success based on successful customer outcomes, and offer reward and recognition for collaboration across organisational boundaries and for customer-experience success.

Staying Competitive and Profitable

Digital shifts over the last 18 months have leap-frogged human thinking and behaviour around prioritizing what is necessary and tolerable in terms of journey friction and what is not. It will continue to impact employees, clients, suppliers and anywhere humans are in our eco-system.

Human patience with previous process driven internal problems has significantly reduced and will continue to erode. On the other hand, businesses that have and are designing for client needs, in an ever cycle of response, are driving impressive results.

If you are still building highly siloed businesses with internal vs external client staff, it’s time to bring the outside in and make it easier for your clients to continue supporting you. Breaking down silos and the structures that keep them in place is a long-term necessity if you want to remain competitive and profitable. Partner with the team at Interact RDT for outcomes-based customer experience strategy that moves you beyond your silos to a coherent customer success team.

RECENT POSTS

Behavioural Design: Influencing User Actions through UX

Behavioural design transforms user experience by leveraging psychological insights to subtly influence actions. Through techniques like nudging, gamification, and personalisation, designers create engaging, habit-forming digital experiences. Ethical considerations are paramount, ensuring transparency and user autonomy. Discover how behavioural design drives user satisfaction and loyalty.

Revolutionizing Banking: The Power of CX in Financial Services

In the rapidly evolving financial services sector, prioritizing customer experience (CX) is crucial. By embracing digital transformation, enhancing personalization, and leveraging AI, banks can significantly boost customer satisfaction, loyalty, and long-term growth. Discover the top CX strategies revolutionizing banking in 2024.