When we hear of silos, our minds drift to a beautiful landscape where we find tall grain bins built on finely manicured and plowed fields. However, when the word ‘silo’ is used in an organizational context, it isn’t such a beautiful sight.
When there’s an organizational attitude where one department purposefully or from a lack of will refuses to share information with other departments, you’ll find an overall decrease in organizational efficiency on multiple levels.
One example is Annual Planning. So many times, Annual Planning takes place in a vacuum. The executive team gathers for one, two, or sometimes even three days to hash out a core strategy for the upcoming year. The Annual Plans I’ve seen when I begin working with new clients are usually pretty good. Yet, the company doesn’t always accomplish much of what the executive team desired in that given year (or at least to the level they had hoped). The various departments within a company might (or might not) also have plans, but those plans aren’t done in sync with the company’s Annual Plan. This haphazard approach to planning may keep your company running, but it adds up to wasted time, lost energy, and frustration (when, for instance, the right hand doesn’t know what the left hand is doing).
Disparity in planning also robs you of the chance to reap benefits of cross-departmental collaboration. You don’t get to see how different components of your business are interdependent, and thus your Annual Plans lose context and meaning. Instead of serving as a beacon for where you’re headed in the coming year, your plan becomes an albatross. It all happens without negative intent, but your Annual Plan so many times becomes a key document that simply fades away with time.
As Patrick Lencioni states in his book, Silos, Politics, and Turf Wars: Silos…devastate organizations. They waste resources, kill productivity and jeopardize the achievement of goals.
Bringing your Annual Plan to Life
If you want to grow your company to higher levels of success, there are a lot of factors to consider. You can, however, begin with letting your Annual Plan work for you vs. becoming a mere list of activities that end up getting lackluster attention (or no attention at all) over the course of the year.
If you want to bring your Annual Plan to life, then avoid planning in silos. One way silos are formed is when different employees from different departments manage their own planning cycles. There’s little to no interconnectedness. Hence, we can compare them to grain silos in a field, where each silo separates one type of grain from the rest. For grain, that’s a good thing. For companies, it creates a culture of independent units that, in the end, ignore the bigger system.
To alleviate this challenge, consider having your executive team identify three to five top strategic priorities for the company (for the upcoming year). Ask a few key leaders to join the session so that their perspectives are heard. Their input can be invaluable to creating a vibrant and viable Annual Plan for the company. I’m frequently asked, “How many people should be involved in our Annual Planning Session?” There’s no magic number and it also depends on the size of your company. I think it’s more crucial to look at how many is too many. The maximum number would be around 10-12 (in most instances).
Next, communicate your Annual Plan to your departmental leaders. If it was worth taking the time to develop it, then it’s worth the time to have a conversation with your next level of leaders about what the plan is for the year, why the initiatives noted are what they are, etc.
Ask your departmental leaders, then, to take the company’s Annual Plan and meet with their people to create their own departmental plans for the year. Encourage them to think of key questions, such as: How can we support the company’s Annual Plan? What is that we need to streamline, fix, or remove as a barrier? Cascading the planning process, using the company’s Annual Plan as the framework, creates alignment and focus throughout your organization.
Discrepancies will naturally occur between different divisions (i.e., HR and Finance may have completely different conceptions for a compensation and benefits strategy). Planning together, then communicating the company’s Annual Plan along with each department’s Annual Plan gives a line of sight to such discrepancies. This line of sight, then, fosters strategic discussions toward clarification around solutions, which in turn creates alignment in thinking.
Even better is using the Rhythm Dashboard to create higher levels of transparency and accountability around your Annual Plan. Using such a dashboard creates the right kind of accountabilities and encourages real-time discussions throughout the entire year. The dashboard sets you up for success by reminding you to review it once a week (because each quarter of the year is a 13-Week Race!). You can discuss what’s going well, what’s not going well (and why), what adjustments need to be made to get a stalled initiative moving again, expectations around how to set the pace for each initiative, etc.
Communicating your company’s Annual Plan to everyone, and then cascading the planning process throughout your organization will give you back the valuable time needed to solve problems, remove roadblocks, etc., all while promoting a higher-level company culture. Giving your planning cycle this kind of clarity also cuts through the layers upon layers of complexity that arise as your company grows to new heights.
Instead of a dreaded event, my clients look forward to their planning cycle. Some of them do their own Annual Planning; others ask me to be onsite with them to facilitate them through the process (which also allows the entire executive team to fully engage and participate in the planning process). Whichever direction you go, promote cross-company collaboration by giving your planning efforts a routine cycle and then do cascade planning based on that cycle. Instead of getting all the drama that goes along with silo mentality (lack of clarity, frustration around who’s doing what, etc.), you’ll be growing a culture of mutual collaboration and discipline.
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