Are Data Silos Hindering Your Digital Transformation? | Dreamfactory

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Data silo

Most organizations today have some form of digital transformation strategy in the works. But a large share of these projects fail. Why is this? IT specialists will tell you that apart from misalignment between the goals of IT and business leadership, the main obstacle to a successful digital transformation is the adherence to obsolete data silos.

What Are Data Silos?

Simply put, data silos are collections of data that can’t be easily accessed by other groups. In the context of a large organization, this would manifest in each department having its own set of siloed data in different databases. This was workable in a time before digital transformation, in which the marketing team had a different working culture than accounting, legal and so on. 

But our technology is changing and customer expectations shift to something more personalized. Marketing strategies turn toward cultivating connected, omnichannel experiences. This isn’t possible without the sharing of data across groups. And if you can’t provide personalized experiences to your end users, most of them will go to a competitor. Gone are the days where your departments have their own plans and policies. All of your organization's departments are working toward a common goal with different roads to get there.

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How They Work Against You

Data silos hinder the best of digital transformation strategies in four major ways.

First, data silos limit one’s view of the complete data picture. This can make you miss out on valuable insights and analytics, leaving new ideas of business opportunities closed to you.

Second, they make for duplication or obsolete data. If every department in your organization handles its own data, you can have multiple copies of the same data. Or one department fails to update their customer data in real-time, leading to inefficiency and inconsistencies across departments. Breaking down data silos is the key to unifying your data and having a consistent source of data integrity throughout your business.

Third, data silos waste resources. Data has to be stored somewhere, and the redundancy bred by individual data silos will take up more space than a unified database shared across departments. With the massive amounts of data we handle today, this is no small problem. Unified data will lead to smaller, more efficient databases.

And finally, data silos discourage collaboration. While departments in the past had their own goals and procedures, recent business technology means those barriers are breaking down. Data silos only throw up another obstacle by making it harder for data sharing across departments.

Breaking Down The Silos

In order for your digital transformation strategy to be successful, the silos have to go. But this can be harder than it sounds.

The first step is to change your company culture. This will be a challenge, but any major change in business strategy needs the support of all company stakeholders. An enthusiastic member of leadership spearheading the movement will go a long way to gaining support.

You can move to cloud-based data management rather than keep everything on-premises. This also reduces the overhead and maintenance required with traditional server management. A centralized data source in the cloud will break down the barriers between departments and give you the opportunity to unify and update existing data. It will also prepare you for future updates, integrations, and new functionalities that are unlocked with unified data.

Another key to unifying your data is with APIs. Application programming interfaces allow for easy data integration between apps and microservices regardless of brand, OS or programming language. They are an essential component in today’s business technology and building a flexible, composable enterprise.

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Let DreamFactory help you create a roadmap for your own digital transformation. A solid API is the first building block for a fully integrated, connected organization. We can help you streamline your existing workflows and add new, exciting functionality with our API management system.

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