THE SILO EFFECT: WHY PUTTING EVERYTHING IN ITS PLACE ISN'T SUCH A BRIGHT IDEA
By Gillian Tett
Little, Brown/Paperback/290 pages/ Available for loan from the National Library Board under the call number English 302.35-TET or at $27.99 at Times The Bookstore, MPH and Popular outlets
Two Saturdays ago, Transport Minister Khaw Boon Wan said his colleagues were now considering roping in shopkeepers in MRT stations to guide commuters during train breakdowns.
That idea, which came from Senior Minister of State for Transport Josephine Teo, would do much to foster the kampung spirit that Singaporeans cherish, he added. Such "family-ness" will be important not just when there is a technical breakdown, but also more critically when there is a terrorist-led sabotage to our rail system, he wrote in a blog post on Oct 24.
Which raises the question: Why is there a need to foster such spirit these days, when such bonhomie seemed to bubble up naturally within the community, and not just within families, in the days before MRT stations were built?
Well, says award-winning British journalist Gillian Tett, that is because the march of progress has rewarded people more for outwitting than helping one another - even within a family.
Tett, who has won Britain's top press prizes and has been reporting for the Financial Times since the early 1990s, is now its United States managing editor. Most notably, in 2006, she warned the world about the 2008 global financial crisis, but few heeded her.
FIVE QUESTIONS THIS BOOK ANSWERS
1 Why are habits so hard to shake?
2 When would it be hard for most people to spot even the biggest risks?
3 What happens when colleagues see one another as competitors?
4 Why did economists stop focusing on society and start focusing on mathematics?
5 How might you best encourage everyone to work better with everyone else?
The author of three books to date, including the award-winning Fool's Gold (2009), Tett calls the attitude of shutting others out "the silo effect", silo being a term which originally referred to concrete towers built exclusively to store grain, but which, since 1988, has been used in business to mean specific tasks assigned to specific people. It led many workers to start saying things such as "I can't do that because it is not within my silo".
Tett's argument, then, is that silos are a natural result of people specialising in what they do best, which often makes working faster and more effective.
But while she is not against silos per se, she does rue that, taken together, they are like the manyheaded snake-like Hydra, with all the venom that the image suggests.
That is because, she notes, the flip side of specialisation is fragmentation, or focusing so intently on your work that you not only do not know what is going on elsewhere in your workplace, but also do not know that you could soon be out of a job.
As she shows in this uniformly excellent book, that sort of wilful blindness led Swiss bank UBS to lose US$19 billion during the subprime mortgage crisis of the late Noughties - and to its chief risk officer being fired because he did not even know the bank was exposed to risky mortgages so extensively.
As she demonstrates through eight concise and precise case studies, what everyone should guard against are the two downsides of silos - tunnel vision and tribalism. Each causes problems to fall through the cracks between silos in a workplace. What is worse, nobody at work is willing to arrest those problems, which is the classic effect of working only in one's silo.
Tunnel vision is what led electronics and media giant Sony to lose out big-time to rivals Amazon and Apple. As Tett shows in her case study, the engineering whizzes of Sony thought up Kindle-like e-Readers and iPod-like devices long before Jeff Bezos and Steve Jobs began researching them.
The rub was, these whizzes also saw one another as deadly competitors and so refused to share any valuable information willingly. The upshot of Sony's isolationist mentality was that its customers could listen to music on its digital devices, but could not download tunes from the Internet - even though Sony engineers knew how to let them do so on their devices. So it became very costly to buy and store songs for Sony devices, just because one department in Sony would not speak to another.
In contrast, the autocratic Jobs made his colleagues brainstorm and work together. Such mixing and melding of ideas got them to see that the way out of the dilemma Sony faced was to separate hardware from software. That is how the iPod and the US$0.99 (S$1.39) iTunes song were born.
Get out of your comfort zone
As Financial Times' United States managing editor Gillian Tett stresses in her new book, The Silo Effect, in an age when people get ahead faster if they help more people, working apart from others is not necessarily the smartest career move.
Join senior writer Cheong Suk-Wai to ponder this at The Big Read Meet on Nov 25 from 6.30pm at the Central Public Library, Basement 1, National Library Board headquarters, 100 Victoria Street.
Sign up at any NLB e-Kiosk or click on www.nlb.gov.sg/ golibrary, search for The Big Read Meet listing and follow the steps there.
If you cannot attend but want to share your views, e-mail your thoughts in not more than 100 words to email@example.com. We will publish the best contributions on The Big Read page.
Tribalism was what hobbled many a central banker during the 2008 global financial crisis, she notes. Shadow banks, or murky financial firms developed outside traditional banks, were all built on the shifting sands of subprime mortgages. When there was a run on shadow banks in the late Noughties, most central bankers, who are a tribe unto themselves, were not even aware that shadow banks existed, Tett notes grimly in a vivid narrative that rarely flags.
Said Mr Lou Gertsner, former head honcho of computer giant IBM, who famously rubbed out the silo effect that used to rot his company: "People do not do what you expect, but what you inspect."
Here, from Tett's book, are three ways in which you can nudge people to work better together:
1. Know everyone by name
This reminds everyone that colleagues are human, with hopes and dreams as well as flaws and foibles like everyone else, and so are not just "those idiots in team six". Having such a perspective will likely help you reach out to a colleague in a friendlier fashion.
2. Design the office so people meet at many points
Facebook founder Mark Zuckerberg and his right-hand woman Sheryl Sandberg work among their colleagues and most of the partitions in their office are see-through glass. Most Silicon Valley offices have link bridges between departments and regular refreshment pit stops so people cannot avoid bumping into one another, thus giving them more opportunities to interact.
3. Look for solutions everywhere
This open-mindedness keeps you in touch with what is happening on the ground and such awareness will help you connect things which seem disparate, but are strands of a solution. For example, through dedicated observations and speaking to different people in the street, four young data analysts working for New York City Hall learnt they could predict fires breaking out in the city with uncanny precision by checking which buildings had new brickwork. Landlords who were willing to shell out for new walls were also likely to make them more fireproof, a fact that the city's 200 building inspectors, who had to inspect more than 200,000 dwellings, had not thought about.
As the Bank of England's former deputy governor Paul Tucker says in the book: "Breaking down silos isn't about a series of actions, but an attitude of mind - it's about having curiosity and a generosity of spirit to listen to others."
In other words, the kampung spirit everyone would like to see more of in Singapore - and not just during breakdowns in train service.
Just a minute
1. Gillian Tett is an engaging storyteller, turning even well-told business stories into intriguing cautionary tales with her fresh insights and precise prose. Her supple narrative and tightly packed points are hallmarks of clear and assured thinking.
2. This book is one of the best in recent years to show how Big Data can work to improve everyone's lives. She does this through the strong, though not necessarily successful, examples of how New York City Hall and the Chicago Police Department made the most of data-mapping to cut the alarming rates of household fires and murders respectively.
3. In Tett's understated way, this book is a grand swoop of corporate history post-World War II. The added fillip is that she has a knack for explaining difficult financial concepts. The casual reader will come away from this book understanding why bankers and economists worldwide have seemed so blinkered for many years. Readers would do better to follow up on this book by reading her award-winning Fool's Gold (2009), which examines more deeply the 2008 global financial crisis.
4. Tett has chosen an excellent format for readers to grasp the effect of silos. She devotes the first three chapters to organisations that have suffered from the fragmentation brought about by silos. In chapters four, five and six, she then looks at businesses bent on busting the silo mentality. In the last three chapters, Tett checks back on lessons learnt from silo-busting.
5. She shows a lot of cultural sensitivity in choosing her anecdotes. For example, she notes, the idea of a silo - from the Greek word siros, which means "pit for holding grain" - is so foreign to Japanese ears that Japan-founded company Sony's Welsh head honcho Howard Stringer had to explain them as "corn pits" as the Japanese were largely unfamiliar with grain storage.
1. This book has a few typos, including "modls" and "Kabeyle" for "Kabyle". A book this smart does not deserve sloppy proofreading.
1. Tett, whose PhD is in social anthropology, first takes you through the evolution of her discipline in admirable depth. This is necessary to a certain extent to help readers understand why and how humans cope with complexity by classifying everything. This focus on anthropology so early in the book may, however, throw less dedicated readers off the rest of her narrative.