Dumping Data Silos for Better Business: An Overview

Whether or not you’re aware of it, at some point in your life you have probably felt extremely frustrated with a data silo. It is a nearly universal experience for a disappointed customer: you work your way through call routing and being put on hold, you finally get to talk to someone, it turns out they don’t have the authority or information you need, you get put back on hold, and then when you finally get to speak to someone who can assist... you spend another ten minutes re-explaining the issue. 

Even if your problem was ultimately resolved, the whole experience probably seemed more like a grim dentistry procedure than a successful customer service interaction. Absolutely no one is interested in spending hours resolving issues for something when the purchasing process was likely a fraction of the time. 

As the year 2021 continues onward, questions from the onset of the pandemic and its effect on commerce have been answered. Undoubtedly, digital is here and now and non-negotiable, and the data shows as much. According to Medallia’s “Contact Center and Digital, Better together” ebook for example, digital channel adoption has grown from 15% to 40% and as many as 75% of the people who have shifted to digital plan on continuing its use long after the pandemic is over. 

Yet as the pandemic subsides, and we settle onto a truly new normal, new questions have in turn emerged for businesses: How can one best maintain digital channels and their increased growth as other channels become more populated again? How do I make sure customer data gathered from digital channels is available to in-store representatives? Or even, how do I simply re-integrate what has been learned from a year of online or socially distanced commerce back into the workplace?  

What can be said without question is that eliminating inefficiencies in customer service — especially when it comes to digital channels and the agility of your essential customer data — is crucial for the on-going success of any business. 

What Exactly Are Data Silos? 

Understanding just how data silos impact your business and your customers first requires understanding just what data silos are. The term itself is meant to describe any kind of information that is unusable either because of logistics or departmental segmentation but can also extend to information that is inaccessible because it is presented in a confusing or unfamiliar fashion. 

Siloed data may seem all bad at first, but it is a natural occurrence within a business as each department attempts to optimize itself to perform its own goals. Data that may seem unimportant to a sales or service representative might prove crucial to an IT manager, and vice versa. For the most part, each department doesn’t need overly specific updates or access to all forms and data that another handles, so we cannot simply dismiss all silos as bad. However, what we can confront is the impediments to better and more efficient service as we break down communication and access barriers on both sides of a transaction. 

When you get transferred during a customer service call and must re-explain yourself, that’s a result of data silos. In this case, the information given to the first customer service representative hasn’t been made available to a supervisor or whichever other department of a business you may now be talking to. That information may still be recorded somewhere in the system, but because it’s not accessible to the person with the authority to act on it, customers may be required to re-explain, re-enter, or re-submit information leading to frustration and possibly customer abandonment. 

In fact, this article in the Harvard Business Review presented findings from a study showing the best way to grow customer loyalty — and thereby retention — isn’t by delivering the most extravagant customer experience possible, but by delivering the essential product in the most seamless and convenient fashion. While customers want their needs met, going above and beyond those expectations offers diminishing returns. But failing to meet those expectations on the other hand, will prompt customers not only to leave your business, but also attempt to punish you for the inconvenience.  

That same study found that service interactions are particularly risky for businesses, as customers are four times more likely to leave a service interaction disloyal rather than loyal.  Delivering that optimal customer experience is about making sure the necessary information for any interaction is never inaccessible, either to your employees or the customers themselves.  

The Expedia Example 

One such object lesson in the costs that data silos present to both customers and businesses is detailed by Dan Heath in this medium article on Expedia solving a $100 million customer service debacle. 

To make a long story short, Expedia suffered from a massive number of customer service calls requesting travel itineraries for a multitude of reasons, including entering the wrong email, getting the itinerary sent to a spam folder, or deleting it because it looked solicitous. All these issues were then exacerbated by the fact that the customer could not use the website to request their travel itinerary after the fact. The problem was so big and so bad that the Expedia executive who first identified the problem discovered that as many as 58 out of 100 Expedia customers were making customers service calls about this issue. 

The data silo here was actually double-sided. As Heath observes, none of the departments at Expedia felt that solving the problem was their responsibility. In fact, it took convening a “war room” of daily meetings between different operating groups to even identify what was going wrong. Every department had been successfully operating according to its stated objectives: marketing was generating leads, sales was converting, tech was keeping the site functional, and customer service was cutting call times down. In order to finally collapse the silos between the customers and their itineraries, Expedia first needed to solve the data silo that had occurred between departments. 

Fortunately, this is also a case where the effects of data silos are immediately visible. After Expedia implemented solutions like Web portal access and more efficient call routing, the number of customers requiring additional service fell to a much more manageable 15 in every 100. That reduction in call volume, at an estimated average cost of about $5 per call, totaled up to saving the business $100 million. It’s a staggering number to be sure, and being able to quantify that kind of impact is rare since there are very few means to detect how much business was lost over time due to frustration. 

As all managers know, it is infinitely more difficult to measure what isn’t happening than what is, but this case provides an excellent window into the real costs associated with data silos. Both for the customer in terms of time spent and assistance required, and for the business in terms of what it takes to realize that service and support. 

Transparency From Top to Bottom 

To zoom out from the issue, it’s clear that there are generational changes underway in how we interact with businesses as both consumers and employees. Most predominantly, those related to transparency and convenience. In a burgeoning new era of the digital age, these might be the most crucial of any two facets of a business’s success.  

“I want to be known as a customer [online] the same way I would be in a store. So, personalization is one of the key points for customers,” said Alexandru Ursu of Salesforce during this webinar on the future of marketing technologies. He continued: “During these times I need to trust that you can provide me with what I need, when I need it, and the way that I need it.”  

Is that not a triumphant call to break down data silos of every fashion?  

Any logistical or technological barrier preventing you from having what you need, when you need it, or the way you need it, is something that just feels outdated in an era of technologically advanced, digitally driven commerce. 

To distill down all these trends into a single directive for businesses is as simple as what the Harvard Business Review article prescribed for best building customer loyalty: Make it easy. Solve problems quickly and easily for both your customers and employees and your business will thrive. 

Bridging the Gap 

Hopefully if you’ve read this far you have a better idea now of what data silos are and the risks they present to your business. If you’re already thinking of some that may be impeding the way your customers interact with your business, or the way your employees communicate, you may now even be thinking, well how do I break down those silos?  

The answer to such a question is multi-faceted and highly dependent on the unique features of your business processes, but without question it should involve open dialogue with your stakeholders. Open those communication channels any way you see fit and start asking questions like: How can we discuss the impact data silos have between our teams right now? Would a data integration between a department and CRM data clear up the issue? Should we change our data structures? Or, do specific permissions need to be changed for teams or users to access data they didn’t have before?  

If you’re already thinking along these lines, you may want to check out some of our other blogs at StarfishETL about data silos, such as this one on how to avoid generating them, or our simple guide on 3 ways to eliminate data silos in your organization. 

Some of these changes may seem difficult to envision or implement since business, and therefore businesses, are as unique and complex as individuals; but there is no reason for trepidation. As customers ourselves, we know that we are more understanding and patient than our crudest caricatures.  

As Deloitte reports, even though some 75% of customers expect consistent interactions across departments, as many as 58% of us come away from service interactions feeling like we may as well have been talking to a different business entirely. Eliminating data silos, improving internal and external communications, streamlining the service experience... these are all lofty goals, and ones that take time to accomplish to any degree. 

However, this is also no cause for complacency. As the pandemic continues to influence and mold our rapidly changing world — and as we prepare for another cultural shift as we begin re-entering workplaces and the world — agility and technological ability will determine who can best take advantage of the present, and who will get to dictate the terms of the future. 

Using all the information, skills, and technology at hand is how you build a business that can excel in this environment, and it’s necessary if you want to guarantee your stakeholders what they need, when they need it, and the way that they need it.