Information silos are the scourge whose downfall has been foretold ever since the rise of enterprise resource planning platforms in the 1990s, but today, their demise remains far from assured.
On the heels of the consumerization of enterprise software and the growing ubiquity of easy-to-use analytics tools, silos appear to be coming back in all their former collaboration-stifling glory as individual teams and departments pick and choose different tools for different purposes and data sets without enterprise-level oversight.
In the short term, that can deliver exciting new capabilities for the users involved, who can finally get the quick business-intelligence insights they want without the involvement of data analysts or IT. Hand in hand with that new democratization of analytics power, however, can come duplication of data and efforts, lack of compliance, data-quality issues and, yes, those dreaded silos again, preventing data and insights from being shared with other parts of the organization.
"ERP suites were designed to be a replacement for separate departmental applications," said analyst Henry Morris, a senior vice president with IDC.
In such scenarios, integrated applications were meant to share the same database for both efficiency and access to a common, integrated set of data.
That, however, is not quite how it worked out.
"Several things thwarted this vision," Morris said. One is that some companies implemented multiple ERP suites; another is the rise of the cloud and software-as-a-service, making tools cheaper and easier to purchase without corporate approval. In both cases, that vision of a single, unified set of data and software fell by the wayside.
The silo problem is particularly common with desktop-based tools into which users upload whatever data they have access to, noted Forrester analyst Martha Bennett. "You can easily replicate the same issue you've already got with spreadsheets," she said. "Multiple versions of the truth, except it looks prettier."
But it can happen in big data projects as well, she said. "Even a successful project -- one that yields tangible results that are of value -- may ultimately be a failure if it ends up remaining a silo."
Either way, the potential consequences are many: time wasted arguing about whose results are right; misguided decisions; regulatory and compliance exposure; and higher cost. "Most importantly, the organization cannot become truly data-driven in its decision-making, which is likely sooner or later to lead to competitive disadvantage," Bennett said.
Allied Global, a provider of call-center services, is no stranger to data silos. With nine call centers in four countries employing about 1,800 people, the company recently replaced a proprietary enterprise software setup that consisted of multiple disjointed pieces spanning different areas of the company.
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