Understanding Data Silos and Business Silos

Striking the perfect balance between honing departmental expertise and fostering collective synergy at a company holds the key to unleashing complete business success. That success comes in the form of sharing necessary information and resources and breaking down barriers that stand in the way.

A data silo is a repository of fixed data that remains under the control of one department and is isolated from the rest of the organization. A business silo, on the other hand, is when business divisions operate independently and don’t share information. While business and data silos are two separate concepts, they often overlap, and it is sometimes difficult to discern the difference.

Identifying the Problem with Silos

At first glance, data silos are efficient and advantageous as they provide a level of data security and isolation. When sensitive or confidential information needs to be protected, segregating it into data silos with restricted access becomes necessary. However, perceived efficiency is deceptive. While the siloing of data is sometimes required, departmental segregation due to data siloing is a more dangerous endeavor for a business’s growth.

The two key problems of data silos include:

1. Lack of a unified view. Companies can’t see the bigger picture when data is sequestered which results in missed cross-departmental insights and opportunities.

2. Reduced efficiency. When reports aren’t shared, it often leads to duplicated efforts in different groups.

A Business Example

Consider a business that employs JD Edwards as its ERP solution. With this system, finance handles budgeting and month-end reporting, accounts payable manages vendors, shop floor teams address inventory shortages, and HR handles confidential employee data. While different aspects are controlled within the same ERP, the departments have gradually isolated themselves to efficiently address their daily and monthly tasks.

Despite using a shared software solution, both business users and management have noticed a lack of cross-departmental collaboration. Each department has become narrowly focused on its specific data reporting objectives, highlighting the fact that even with a unified system, data and departmental silos still emerge.

What Can Be Done?

Preventing data silos doesn't have to mean giving up on departmental specialization and projects. As discussed above, some siloing is even necessary. Instead, a business must communicate and share data as a collective unit. Upon identifying the problem, what will you do to combat preventable siloing within your organization? The top performing companies apply the following best practices:

1. Unified Data Platforms. Adopt platforms that consolidate data from different locations, providing a single source of truth.
2. Culture of Collaboration. Encourage departments to collaborate and share data regularly.

3. Cross-departmental Teams. Create teams with members from various departments to work together on projects, fostering innovation and breaking down silos.

ReportsNow: A One-Stop Solution

Navigating the world of data management and inter-departmental relations can be challenging, but there are dedicated solutions out there designed to streamline the process. With over 50,000 users worldwide, ReportsNow's Data Access Studio guarantees business users maintain control of their data while sharing insights within and across departments. This solution offers a unified platform for JD Edwards customers to harness the power of their data without risking fragmentation. In turn, cohesion across the company ultimately results in the right balance between specialization and collaboration.

Conclusion

Curious what ReportsNow can do for your business? Contact Quistor to set-up a demo.