Fragile Silos

tl;dr

Under Taleb’s framework (see sources below), technological and knowledge silos significantly increase an organization’s fragility!

By isolating knowledge, limiting communication & creating rigid structures; silos make organizations more susceptible to shocks and less capable of adapting to change.

Over time… this fragility can lead to systemic failures, particularly in the face of unexpected challenges!!

To build resilience or even anti-fragility (yes it is possible!), organizations need to break down silos, promote cross-functional collaboration, and foster a culture of continuous learning and adaptation.

Setup

Organizational Fragility (OF) - susceptibility of an organization to experience significant disruption when exposed to stress/shocks/volatility/uncertainty (comes straight from Taleb’s fragility framework.)

Knowledge Silos (KS) - expertise is confined within specific teams or individuals, preventing free flow of knowledge across the organization!

Technological Silos (TS) - different departments within an organization adopt/develop their own technology stacks, tools, and systems.

Insight: impact of KS+TS on OF?

  • Increased Sensitivity to Shocks

    • Lack of Redundancy
      • can make an org highly fragile!
      • if one silo fails, often no backup or alternative system in place
      • taleb’s idea: “fragile systems lack buffers or flexibility to absorb shocks”
    • Single Points of Failure
      • silos create isolated knowledge / technology systems
      • critical information or functionality resides only within one silo
        • Entire organization becomes vulnerable if that silo is disrupted

  • Reduced Ability to Adapt

    • Rigidity
      • taleb’s idea: “fragile systems are rigid and cannot adapt to change”
      • silos create rigidity by locking teams into specific ways of working and thinking
      • reduces org’s ability to pivot or respond to new challenges
        • flow of information and resources is not actively promoted
    • Delayed Decision-Making
      • slower & less effective in a siloed org
      • as we need to consolidate fragments of information from different teams
      • delay can exacerbate fragility by preventing timely responses to emerging risks

  • Negative Feedback Loops

    • Amplification of Errors
      • silos prevent cross-functional communication
      • errors in one part of the org may go unnoticed or uncorrected, leading to cascading failures
      • taleb’s idea “small problems in fragile systems can escalate into larger crises”
    • Lack of Shared Understanding
      • silos can lead to misaligned objectives and priorities
      • no shared understanding of risks or opportunities across the org
      • misalignment can create conflicts/inefficiencies that compound fragility!

sources

  • first hand experience

  • theoretical underpinnings - incerto series

    • philosophical essays on uncertainty - five book bundle
    • fooled by randomness
    • black swan
    • bed of procrustes
    • antifragile
    • skin in the game