Eight to Late

Sensemaking and Analytics for Organizations

I’ll sit in my silo no more

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Many organizations are structured along functional lines – i.e Sales, Marketing, IT, HR – with each department headed up by a functional manager. The well-known limitation of this organizational structure is that it is not conducive to cross-functional cooperation and communication. Work done and experience gained by a department is rarely shared across the organisation, as there’s no incentive to do so. This behaviour is well recognised. For example, as Goldratt has pointed out in his business novels on the Theory of Constraints, most organizations focus on optimising locally instead of globally. In general, a local (in this case, departmental) optimum is not a global (organization-wide) optimum.

As a concrete example, the dental hygiene division of a company may have worked on developing segmentation models for their markets. Over several years they’ve developed much expertise in the area. Now, this year, the skin products division of the same company wants to work towards developing a better understanding of their markets. They start working on this without even being aware that someone on the floor below could help them for free. Obviously, the exact same strategies may not work for both divisions. However, the experiences gained and lessons learnt by dental hygiene would certainly help skin products in the latter’s quest to understand their specific market.

“So”, I hear you ask, “what’s your point”? It is this: in IT we’re well placed to start cross-functional communication, as we’re the one department that works with just about every other one in the organization. You might, for instance, have done a lot of work with Department A over the last few years. In the course of this, you’ve built up a good understanding of their specific business. Now, this year, you’re working with Department C to develop some other applications. It is quite (very!) likely that some of the knowledge you’ve gained while working with A will be of direct use to C. Use it! Your organization will eventually thank you for it. Even if you get no thanks, you’ll have the satisfaction of knowing that you’ve done something that expensive management consultants can only prattle on about.

Written by K

September 17, 2007 at 5:58 am

Posted in Consulting

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