Silo formation in any company is inevitable but to what extent it negatively impacts progress and success is of great importance, particularly where it has been identified as a barrier. 

It is widely known, as outlined through a roadmap by (LugoSantiago, 2018) that ‘collaboration fuels and facilitates competitive advantage; this is why it is so important for leaders and managers to embrace and understand its importance in removing silo formation’. However, at the same time it has been evidenced that in understanding silo’s and their effect on team dynamics and identity that they are often recognised as not a physical or conscious issue, (Cilliers, Frans. Greyvenstein, 2012) but something that is a deeper manifestation that is arguably the circumstance of unconscious behavior. It is this specific problem that requires further investigation. It is therefore necessary to identify, break down and prevent the barriers of silo formation and in doing so understand the change parameters required within X Bank.

Purpose of the Study/Company background?

The aim of the research is to understand the impact of siloed thinking in the banking sector and to provide insight into how it can successfully be broken down as a barrier in order to achieve cohesion and improved performance through a common organisational lens at X Bank.  It is well understood that banks, generally speaking, have to be built with some form of functional and divisional formation due to the varied nature of the business activity type and cross-sectional array of potential target client/audience. All of this also has to be formed within the highly stringent legal and political framework that dictates the industry. In order to solve for the issues around siloed thinking, it first needs to be understood as to how and why silos have formed in the first instance. Consideration will be made as to what environment is conducive to the creation of siloed thinking. Only then, will it be possible to understand and explore how to break down what are effectively barriers to being able to move forward effectively and successfully. As Tett, (2015), argues, ‘Silos can be useful but also dangerous’; they have the power to collapse companies and destabilise financial markets, yet they still dominate the workplace’ (Tett, 2015). 

Research Question and Objectives

The specific question to be answered therefore is ‘How can a ‘silo mentality’ in the banking sector be shifted in order to be able to enhance the customer experience whilst also enhancing shareholder return?’: An in-depth analysis of the new strategic collaborative approach of the case organisation X Bank. 

It is this conceptual idea that silo presence is indeed a barrier and a negative presence which will be further explored by the empirical research and by understanding the following research objectives; –

a) To consider the impact of silos in a banking context through 3 lenses; cost, Employee and Client 

b) To analyse the extent to which banks have to create precise sub-businesses within a banking segment and to consider this in the ‘build-phase‘ of a future-proof operating model

c) To make effective recommendations on strategies to allow X Bank to better utilise its potential to achieve better organisational performance and improving its resilience.

d) To derive advice regarding enhanced shareholder return by reversing the silo effect/through the removal of silos within the organisation.