Maybe Small Business Needs Some Healthy Silos?

Many businesses start with one person who does everything. As people join the team, they often wear multiple hats (or parts of hats) depending on what the business needs. The structure is very flat, with everyone reporting to the founder. All the “grain crops” are in one room, and anybody can address anything that needs attention.

When the company is small, the piles of grain are small. It’s efficient, nimble, and flexible. As the business grows, you just get a bigger room – what worked before…

Eventually, managing the piles of grain gets harder, the barley gets mixed up with the canola, rye and that pesky amaranth. Areas of friction start to slow progress:

  • Decision making authority tends to stay with a small group, leading to “accountability overload”. As the number of decisions increases, the time it takes to make them increases. Those “decision choke points” make it feel like the business is slogging through molasses.
  • When even everyday decisions fall to a small group, the rest of the organization tends to become populated either with people resigned to being task doers or people that are perpetually frustrated they aren’t trusted with more authority
  • Multiple people, multiple hats leads to lack of clarity and results in different directives and the resulting re-work is accompanied with capacity draining discussions to clarify decisions

Most of you know where I’m headed. You need to separate your grains. This will be a cultural shift, and like so many things, it’s simple but not easy:

  • Find the cleanest, simplest way to structure your company to push decision making as far down as possible
  • Identify what each person needs (training, delegation, etc.), and determine a transition plan for those who need one

Simple, not easy. And there’s one more piece (and where the silo analogy breaks). Effective businesses don’t have silos. Silos blame each other for whatever friction point is causing pain. In larger organizations that makes things hard. In smaller businesses that will kill you.

It’s vital when shifting the culture to expanded accountability that the full message is: “Clear accountability, everybody helps”. So, if:

  • You are responsible for maintenance, and that now includes ordering and managing parts but you and your team have no expertise in that area, while we get you trained, I will help.
  • Or, I run the engineering department, but the customer service portal is down and we need help responding to customers, I help.

Easy to say, hard to do. Part of supporting the team is teaching them how to assess their own capacity and juggle their priorities so that they can help where help is needed. Also key: help those who have legitimate capacity limits.

Strategy is an integrative discipline. – Roger Martin