Why silos restrict scale -- and what to do about it [Q&A]

Silos, you might think, are bit of a niche issue. They arise when old practices become entrenched, or when tools are only used by one part of the organization.

But Shannon Mason, chief strategy officer of Tempo Software, argues silos are actually a major roadblock to growth, agility, and strategic alignment. We spoke to him to find out about the hidden cost of silos and the concrete steps teams can take to break them down.

BN: How do you define organizational silos and what are some common examples?

SM: I think of silos as barriers that block information flow, collaboration, and trust between groups. They’re not just org charts or reporting lines, they’re lived experiences. Neuroscience gives us a useful metaphor here: imagine brain regions firing but failing to connect. Each region may be active, but if they don’t integrate, the whole brain can’t adapt. The same is true in enterprises. Sales, Marketing, and Product may all be delivering, but if their work doesn’t connect, the business loses coherence.

Common examples show up everywhere. Different roadmaps and prioritization rituals in functions that should be tightly aligned. Data scattered across systems -- customer insights locked up in CRM, product usage data trapped in analytics platforms, and financials only accessible in ERP. Or duplicated governance offices each trying to control ‘their’ portfolios. McKinsey reports that 61 percent of executives say their companies have weak coordination across functions. In other words, silos aren’t an exception, they’re the default state if you don’t design against them.

BN: What sort of problems do silos create for the enterprise?

SM: The cost is high. Psychologically, silos increase cognitive load and bias. People make decisions with incomplete information, which lowers trust and slows execution. Social identity theory tells us silos also create ‘us versus them’ thinking, which erodes collaboration further. From a neuroscience perspective, it’s a failure of organizational plasticity. The enterprise can’t rewire quickly enough to respond to signals in the environment, so it lags behind.

The data is sobering. Firms that collaborate across boundaries see 47 percent higher innovation success rates. Gallup shows employees who perceive poor collaboration are three times more likely to be disengaged. PwC found only 55 percent of executives believe their projects actually align to strategy, largely because portfolios are managed in isolation. The result is easy to recognize: duplicated investments, missed cross-sell opportunities, and slower adaptation to market dynamics. Silos don’t just frustrate employees, they kill enterprise agility.

BN: What role do business leaders have in creating and perpetuating silos, and what must they do to help break them down?

SM: Leaders play a huge role here, often without realizing it. When leaders reward local wins, focus narrowly on departmental KPIs, protect headcount, or treat budgets like territory, they reinforce silos. Jeff Pfeffer’s work on power makes this clear: the incentives leaders set will drive the behavior, even if it fragments the system.

To break silos, leaders need to shift from positional control to systemic stewardship. That means they must actively model collaboration across boundaries, put real weight on enterprise outcomes instead of departmental scorecards, and invest in shared frameworks for portfolio and program management that prioritize value dynamically across the whole organization. Kotter’s research shows transformation success nearly doubles when leaders role model cross-boundary behavior.

In neuroscience terms, leaders act like neurotransmitters. The signals they send determine which pathways get reinforced. If they reward collaboration and cross-functional success, those pathways get stronger. If they reward territorial wins, those get reinforced instead.

BN: How important is it to create a single source of truth and ensure data is accessible across the entire organization?

SM: It’s fundamental. Without it, you’re just automating dysfunction. Shared data enables shared mental models, which organizational psychology research shows are directly correlated with team effectiveness. When everyone can see and trust the same context, decision quality improves dramatically.

Deloitte found that companies with unified data ecosystems are 23 times more likely to acquire customers, six times more likely to retain them, and 19 times more likely to be profitable. Transparency also reduces uncertainty, lowering the brain’s threat response and increasing trust. This is why data accessibility isn’t just a technology problem, it’s a psychological one too.

With AI and modeling layered on top of unified data, the game changes. You can run predictive simulations, surface weak signals early, and democratize insights. Decision-making no longer lives exclusively in the C-suite. Instead, intelligence is distributed across the organization, allowing teams to respond faster, with more confidence, and with greater alignment.

BN: What steps can be taken to address employee resistance and fear of change when attempting to dismantle silos?

SM: Resistance is natural. Neuroscience and psychology both tell us that change is often processed as loss. Kahneman and Tversky showed decades ago that loss feels more significant than gain. When employees hear about dismantling silos, they often fear losing control, identity, or stability.

The way through is to create conditions where change feels like expansion instead of contraction. First, build psychological safety. Google’s Project Aristotle found it’s the number one predictor of team effectiveness. People need to feel safe experimenting and collaborating across boundaries. Second, give people autonomy and a real role in shaping change. Self-Determination Theory shows autonomy drives intrinsic motivation. Third, create visible quick wins. Kotter’s 8-Step Change Model highlights how early successes build momentum. Neurologically, those wins deliver dopamine hits that make change feel rewarding rather than threatening.

AI can be a powerful ally here too. Instead of replacing judgment, it can act as a scaffold, giving employees augmented foresight. Simulations and predictive insights can help people see what success looks like in the new model, reframing fear of the unknown into curiosity and engagement.

Finally, this is where neuroscience, organizational psychology, and modern portfolio management intersect. Silos aren’t just an organizational design flaw, they’re a neurological analogy for how enterprises get stuck. Breaking them down isn’t just about new tools, it’s about rewiring incentives, creating psychological safety, and building shared data foundations that let AI amplify intelligence across the system. Done right, this accelerates speed, distributes opportunity, and builds organizations that can finally adapt at the pace the world demands.

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