While many businesses are quick to laud the benefits of cloud computing, file-sharing, and data analytics, the fact remains that so many businesses and organizations are unable to take full advantage. Though ERP and cloud solutions are transformative tools to reshape the way you do business, too many companies are still limited–fighting through data silos, hampered by structural confines, or simply hindered by growing pains.
“Although the power of analytics is common currency, it’s spoken of far more often than it’s practiced,” according to Edd Wilder-James at the Harvard Business Review. Wilder-James’ quote here can extend beyond just data analytics, but to the transparency and visibility that’s at the core of effective resource planning. Usually, managers don’t simply neglect resource planning, but instead, it stems from a result of simply growing fast, trying to manage the growing tension between scaling internal processes to meet a growing demand.
Symptoms Behind Silos
When management has to make important decisions fast, often this can lead to solving individual problems on an ad hoc basis–using standalone applications to solve individual problems instead of an integrated system that addresses scalability. Unfortunately, these standalone applications can stack up, creating standalone departments with barriers to effectively and efficiently collaborate.
Silos can develop for a number of reasons; Wilder-James suggests that silos can arise from structural or political reasons, and growing pains. Structural silos can often result from the scenario described above, where specific resources or software applications are designed and optimized for one specific function. Since many on the ground floor of a company’s operation will focus on function, it deprioritizes the need for cross-departmental communication. Political silos may arise when certain people or departments choose to be intentionally protective of their data.
While silos can arise no matter your industry, these symptoms are completely treatable. In a recent study, we looked at the inefficiencies of standalone architecture and how integration not only builds a more fluid business process but also builds your bottom line.
Cures in the Cloud
After studying several different businesses and treating their reliance on standalone software with an integrated platform, it becomes clear that cross-departmental collaboration through integrated software removes friction, increases visibility, exponentially accelerates efficiency and builds the profile of both your product and your margins.
“By arming your sales, service, operations, and other customer-facing
staff with real-time access to all critical customer information, the
team can more quickly and accurately handle the customer’s requests.
This complete view of each customer’s interaction and transaction
history is also powerful for maximizing upsell, cross-sell and renewal
revenue and can be used to identify customer trends and patterns for
strategic planning and marketing efforts.”
In a recent webinar, Harvard Law Professor Heidi K. Gardner discussed her new book Smart Collaboration, which also applauds collaboration across departments as a way to tackle organizational challenges while building more profitable businesses. The result, argues Gardner, is conclusive proof that collaboration pays, for both employees and their firms.
After studying two large consulting firms, Gardner was able to replicate data across over twenty different businesses that illustrated a powerful visual on the benefits of smart collaboration:
The above graphs look at how adding more departments or business units in a customer’s experience actually increases the revenue of the company exponentially. The black line and the corresponding blue graphs identify that as business units worked together to solve customer problems, their revenue increased exponentially. Looking at the red columns, by contrast, this shows what it would look like if each department simply added the same value as the previous department. Instead of just increasing, businesses that can effectively cross-collaborate from supply chain to customer success actually harness the potential to increase their revenue exponentially. For more on Dr. Gardner’s findings, you can view her webinar here.
Our whitepaper illustrates several of the same conclusions with specific examples from businesses who have solved complex problems with more effective collaboration. For more information on how to make your business more efficient, download our whitepaper or get in touch today.