The problem with the silo-effect

This silo-effect is problematic for many reasons:

1. Silos tend to become entrenched over time. Each division or department dives in and focuses solely on their immediate tasks and goals. Without personal relationships and interactions among departments, and without an overall culture to bridge gaps and build connections, everyone loses out.
2. Singlehandedly shouldering the responsibility for customer success limits the ability of CS teams to invest in customer-led growth and further their own professional development. Instead, customer success managers (CSMs) spend most of their time on tactical tasks and putting out fires. They have little time to develop and implement strategies that can enhance growth, bring in new customers and directly impact the company’s goals—and bottom line.
3. If customer success is the responsibility of a single team, it will fail. Customer success is an outcome that depends on 3 ingredients - product, customer and services. By design, these need to be aligned in order to ensure happy, loyal customers.
4. Important context is lost when each team only has a fractional view about the customer. Marketing and sales work with assumptions about the ideal customer, but who really fits that profile becomes revealed from working directly with actual customers. The same is true for product development. How can you qualify feature requests? Are they coming from your most profitable customers or the ones that complain night and day?
5. Another common consequence of lack of alignment is misguided customer expectations. Without communication between marketing and sales with product and customer success, unrealistic or plain wrong projected outcomes may be communicated to the customer. There’s not only a 99% chance these customers will churn, but they also might feel that they’ve been tricked into buying. This, of course, can deliver a massive blow to a company’s reputation.

Why are companies so siloed right now?

Silos have long been a problem, particularly as organizations scale. The core reason silos exist is that too many organizations operate at a departmental level, including developing goals and infrastructure that supports their immediate need rather than looking at what’s best for the company (and the customer) holistically. Fundamentally, if employees are not measured on collaboration, but goaled on functional metrics (sales, delivery etc.) then there’s no requirement or urgency to work across silos.

In addition to pulling teams in different directions; these goals can be contradictory. If the sales team is purely incentivized on sales volume, the customer quality is likely to suffer. Lower customer quality leads to higher effort for CSMs at high costs; those customers are likely to churn anyways and companies may waste a lot of CS resources until they do. These same resources are better spent growing and monetizing your high-quality customers (opportunity costs).

In many respects the pandemic served to rapidly and dramatically worsen the silo effect. Since the first quarantines in 2020, we’ve become accustomed to working in isolation, connecting over Zoom, Slack and Monday, on an as-needed basis, primarily to the co-workers within our departments. Three years later, even with the pandemic officially declared over, many people are still working at home for much of the week.

Meanwhile, the economic downturn and inflation have led to rising operational costs and increased financial scrutiny. Companies in every industry are feeling pressured to do more with less. Unmeasurable or soft goals like building workplace culture quickly tend to take a backseat when finances are feeling tight. Instead, each employee and each department is encouraged to double down and focus on their core tasks. In turn, silos deepen.

While this approach is understandable, it can be short-sighted. Investing in a unified company culture that prioritizes customer satisfaction as a company-wide goal can significantly increase the bottom line. Now is exactly the time to focus on breaking down silos.

What can companies do to dissolve silos?

While matrixed organizations and remote work practices do contribute to silos, the truth is that much of the problem can be solved if leaders create a common, customer-centric mindset. With management leading, companies can foster a customer-obsessed culture from the top down. The general message can be that customer satisfaction is everyone’s responsibility—from product and marketing to dev and support. If customers aren’t happy, it’s everyone’s problem and the impetus is on every single employee to do their part to help ensure customer success.

To help foster this mentality, management can write out a simple, clear customer-driven mission and share it prominently. Set inter-department OKRs and clearly communicate them with every manager and team. Then, set up simple reporting methods with clear insights and metrics that help everyone track progress toward these OKRs.

The role of technology in silo-busting

Particularly in larger companies focused on product-led growth (PLG), AI-driven technology can be a game changer. The right tech can provide a way for everyone to easily and constantly monitor the health of accounts, and get notified when changes in communication, product or support are needed. It helps dissolve silos by ensuring that all departments are aligned and on-board about goals related to customer satisfaction and how they relate to the work of each employee. Are product changes indicated? The relevant product team will get a notification. Has a bug been identified? Dev gets a ping.

Aligning Teams with Clear, Actionable Insights

LoudNClear has developed an AI-driven software designed to provide companies with a single source of integrated information that gives all stakeholders a unified view of customer health across the organization. The software can immediately notify all relevant employees (not just CSMs) when a given customer presents a risk for churn or a potential for upsell.

Additionally, LoudNClear provides simple dashboards and reporting with clear insights and actionable steps. This approach saves valuable time for CSMs by automating tasks that previously would have taken up significant time, freeing them to invest more on developing customer relationships and expanding their portfolios.

Now that we’re finally able to talk about COVID in the past tense, it’s time to focus on the future of our workplaces and how we want to foster company cultures that are customer-centric, promote interactions among employees across all departments and are lean but profitable. As AI-driven technology becomes omnipresent, companies will need to integrate it wisely into their toolbox to be relevant players in the future.

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