A company is organized in a way that is conducive to carrying out its required activities. We often encounter several functions within the company, known as divisions or departments. Each can carry out its activities independently or interdependently with other divisions.

Sometimes, a division does not want to communicate openly. This can hamper information dissemination between divisions.¹ Without communication and information exchange, it will not be easy to coordinate to achieve organizational goals.²

Silo mentality, as described previously, is counterproductive because it may originate from unhealthy competition from people who sit at the top levels in various divisions in a company. It can also happen between people at multiple levels who essentially have a hidden agenda for their interests.³ One of the characteristics of the silo is the unwillingness of everyone involved in an organization to share information that is very valuable or even necessary to other divisions or departments in a company.⁴

In the omnihouse model, we can observe four distinct functions: marketing, technology, humanity, and finance. (Don't worry, we will discuss about operations later on.) Notice that marketing and finance are in separate corners. The same is true with technology and humanity. These are placed accordingly to stress the fact that in companies, these functions are often siloed or separate. Contradictory characters are also seen between the CI‐EL and PI‐PM elements. These are the various dichotomies that we can find in the omnihouse model (see Figure 6.1).

In this chapter, we'll observe ways to break down the silo challenges. We'll start by exploring ways to connect marketing and finance. We'll also consider the convergence of other resources, especially those related to technology and humans.

Connecting Marketing and Finance

As discussed in Chapter 1, one of the classic marketing blind spots is the incompatibility of finance and marketing functions—one of the most visible dichotomies (see Figure 6.2). Marketers are often only fixated on nonfinancial measurements. Financial executives usually ask what marketers want to achieve when using their budget. It could be that marketing people will give answers such as increasing brand awareness, creating certain perceptions, and communicating value propositions.

Such answers will sometimes make financial people frown because they may not understand the value of all that the marketing team wants to achieve, especially the terminology used, which is not a normative financial lingo. Finance people then sometimes jump to the further question: what will be the return from the money they would give to marketing people?

Many of the financial domain's primary measurements refer to the idea of return, for example, return on sales, return on assets, and return on investment. Meanwhile, marketing people often use metrics that are nonfinancial, such as loyalty index, satisfaction index, top of mind, and market share.

Some marketing people may also not care about the company's financial statements. The only aspect that is often associated with financial measurement in marketing practice is sales, which is only the top line in the income statement. We can achieve (or even exceed) sales target by at‐any‐cost efforts, but this will make the bottom line negative. The bottom line is the primary concern of most shareholders because it will determine the dividends that shareholders will receive.

However, sometimes financial people place too much emphasis on cost containment alone without seeing that the money spent will accumulate nonfinancial results, which can be converted into financial results under certain conditions. As such, it should not only be seen as an expenditure but rather as an investment.

Finance professionals must understand how various departments work to gain a more contextual understanding, which can help other departments when making decisions about budget expenditures.⁵ As previously discussed, the inter‐departmental collaboration will strengthen a one‐firm mentality to deliver the best products and services to customers and positively affect company revenue.⁶

Coupling Technology and Humanity

The definition of machines in this digital era is not limited to machines that work only on the mechanical aspect. Machines with technology such as AI can perform human work with much higher precision and consistency due to robotics technology. These machines are also connected to one another using Internet of Things (IoT) and blockchain technology.

Ideally, these intelligent machines should support organizations to serve the company's internal customers, namely, people (employees) working in the organization; external customers, including those who buy and use various company support services; and even society.

Intelligent machines with digital technology can provide the following services:

• People. We design and use machines for efficiency and, more than that, to make employee work easier, more ergonomic, and free from possible injuries while increasing productivity. Technology will enable workers to carry out their duties more humanely. Technology enables someone to work from anywhere because they can always be connected and access various data and information remotely.
• Customers. Technology enables companies to offer personalization, customization, and humane or compassionate navigation. If people in a company are humanized and assisted by technology, they can ultimately provide more humane services for customers. The era of customer exploitation has long ended, and with technology, it is time to fully humanize customers by offering solutions that can improve their quality of life.
• Society at large. Even if you don't buy products marketed by a company, it doesn't mean that the company can ignore the wider community's interests. Switching to renewable electricity technology in all its factories, as Mercedes‐Benz did, ensures that they are also responsible for the environment's quality. Recycling technology enables companies to reduce waste drastically. Likewise, using biodegradable materials in various products is an indicator of the company's concern for the environment.

  The latest technological breakthroughs are routinely incorporated into wildlife protection projects, from monitoring endangered species to detecting poachers. Drones, data, and digital mapping can be used to track endangered wildlife. Increased poaching activity in Africa has decimated the elephant population in Garamba National Park. Garamba's herd once numbered 22,000 elephants, but by 2017 it had shrunk to only 1,200. During the following three years, Garamba cut elephant poaching by 97%. To do so, it adopted location intelligence, which enabled specialized surveillance teams to track and monitor each animal 24 hours a day using a mix of GIS and IoT.⁷

We can fulfill our obligations to those stakeholders by using very sophisticated digital technology intelligent machines. Ideally, technology and humans should provide humanity for people, customers, and society at large.⁸ The essence of using technology together with humans—hence, converging the dichotomy of technology and humanity—will become a growing priority among companies in the years ahead (see Figure 6.3).

The Importance of Unification

It can be tough to break down the silo status quo. Let's consider two obstacles that often need to be overcome to unify the company. Then we'll look at why integrating is key and how to measure your success along the way.

Obstacle 2: Organizational Inertia

Usually an organization that has reached the maturity stage will continue its journey into the future by simply continuing its trajectory for a long time. The organization cannot instantly change its trajectory due to strong inertia. It is not surprising that a long‐existing company using various conventional value‐creation processes will face difficulties if it suddenly has to change by adopting a more progressive approach.

Consider the Deepwater Horizon explosion, which claimed the lives of 11 people, injured 126 others, and resulted in a three‐month‐long oil leak. According to a federal study, the disaster was caused by “poor risk management, last‐minute plan changes, inability to notice and respond to vital signs, inadequate good control response, and insufficient emergency bridge response training.”¹¹ In a nutshell, the inability to adapt to external challenges and diverse situations can lead an organization into disaster.

Start‐ups and the many leading tech companies have a different story. Since inception, they have adopted a progressive approach that suits the highly dynamic business environment. Of course, for the time being they don't need to recalibrate their trajectory. However, if there is another significant wave of disruption, then these companies will have to revisit and adapt their approaches. Sometimes there are some start‐ups that have had problems from the beginning so they can't grow, let alone develop (see Figure 6.4).

Large, long‐standing companies can indeed avoid inertia. You probably think of a forward‐thinking corporation when you hear the name DuPont. However, not many know that E. I. du Pont, a Frenchman with experience creating gunpowder, founded DuPont in Delaware in 1802. Du Pont established his first powder mill on Brandywine Creek in 1804, using willow tree bark for charcoal to generate black powder. Since then, the company has produced dyes, sweater fibers, and film for Hollywood movies, among other things. DuPont and Dow merged in 2015. It relaunched its brand in 2018, with a new logo, an emphasis on innovation, and a wide range of solutions.¹² In 2018, DuPont spent about US$900 million on research and development. It claims that items introduced in the previous five years boosted new sales growth by more than 5% in 2018.¹³

Reasons to Unify

Although there are many benefits to integrating, three main advantages stand out. Let's consider relevancy, survivability, and sustainability. Each of these underscores the importance of getting together.

Phases Toward Sustainability

After understanding the various dichotomies in a company―and the converging―we can simplify it into a model (see Figure 6.5).

Here is the explanation of this model.

• Phase 0: Potential/Loser Company

  Every company, newly founded or established, has various potentials. If it faces an obstacle it cannot overcome, such as being too rigid or having too much inertia, it will lose out among other players.

• Phase 1: Relevant Company

  If the potential company's rigidity and inertia are not too strong, the company can have a better possibility to converge various dichotomies within the company.

  Management also has a broader perspective by referring to a competition setting consisting of relevant competitors and customers. Thus, the company can move up the ranks to become the relevant company in a competition, although it may not survive. However, if the company becomes inconsistent in carrying out the convergence process, it may move down again to become only a potential company or even immediately become a loser.

  

• Phase 2: Surviving/Winning Company

  If the potential company has an even smaller level of rigidity and inertia, it is more likely to maintain the convergence of the various dichotomies it has carried out.

  Management also has an even broader perspective by referring to the business ecosystem, which consists of various partners connected conventionally or digitally while also paying attention to relevant competitors and customers.

  In this way, the company can move up to a higher level to become a surviving company. In certain conditions, if its performance is much better than its competitors, it can become a winning company. Simultaneously, the company also has a relatively stronger bargaining position with many elements in the business ecosystem.

  However, if the company becomes inconsistent in maintaining the various convergences of dichotomies, it may cause it to drop back into a merely relevant company again.

• Phase 3: Sustainable Company

  If the surviving/winning company has little or no rigidity and inertia, it will likely carry out a sustainable transformation while maintaining the various convergences they have successfully carried out previously.

  Management also has a whole perspective by referring to the overall business landscape, including the main drivers in the macro environment, business ecosystem, relevant competitors, and customers. Thus, the company can reach the highest level to become a sustainable company, which is the ultimate goal for every company. The company will also have a powerful relative bargaining position against various elements and factors in a business landscape.

  However, suppose the company turns out to be inconsistent in carrying out perpetual transformation while at the same time maintaining various successful convergences. In that case, it may descend into a surviving company that still enables it to win the competition under certain conditions.

  Because change occurs regularly, the organization should always be prepared to change. For example, organizations have gone through five significant firmwide changes on average in the last three years, with more than 75% expecting to increase substantial change initiatives in the next three years.¹⁷

Every company must understand its current standing in these phases. The organization can study the dynamic elements that exist internally, especially those related to organizational rigidity and inertia. It can also look at external factors, especially including the main drivers in the macro environment. Then the company will be able to determine ways to survive and become sustainable.

Key Takeaways

• Creating strong relationships between the marketing and finance departments can lead to significant financial advantages.
• Balancing technology and humanity, in which employees are supported by automation and are able to focus on high‐level tasks, leads to a stronger workforce.
• Organizational rigidity and inertia are the main obstacles on a company's path toward unification.
• Coming together as a company is essential for relevancy, survival, and sustainability.
• Breaking down siloes doesn't occur overnight; companies can move in phases toward sustainability to ensure longevity in the marketplace.