Many HR teams rely on their people data to make informed decisions, enhance processes, and add value to the business. In short, data can make HR’s life easier. However, if a mix of separate systems exist within an organisation, which don’t integrate or communicate with each other, this will likely lead to data silos - and then very quickly, HR’s life becomes harder.
“Data silos exist when different teams within an organisation store and manage their data separately, without sharing or integrating it across the company,” remarks Taryn Froneman, head of HR at Pearl Lemon.
“Legacy systems, departmental autonomy and the lack of standardised data governance are all contributing factors [to data silos] and, as a result, data becomes departmentalised and difficult to access and share across the business,” adds Helen Armstrong, CEO and founder of Silver Cloud HR.
There are also often different unique identifiers in different platforms and a lack of time, or sometimes skill, to align the data accurately, says Zoe Wilson, director of ReThink HR. “It also needs teams to work together - especially if their systems don’t - so unless they are actually planning and discussing their data and how it links, it’s hard to map the cross-functional data into meaningful insights or stories.”
Why are data silos problematic?
Data silos can be problematic for several reasons, says Taryn Froneman. “When data is siloed, it's not accessible to those who need it, leading to inefficiencies in decision-making and operations. Also, silos often result in duplicated, inconsistent, or outdated data because each department may have its own version of the same data, leading to errors. Plus, data silos make it difficult for teams to collaborate, as employees are often unaware of the information available in other parts of the organisation. This lack of knowledge sharing can prevent innovation.”
Silos can also negatively impact business growth, as well as reduce the scope of what decisions can be made through data analysis.
“Data silos hinder an organisation’s growth as disparate systems can prevent a comprehensive view of operations, leading to missed opportunities, inefficiencies, and the inability to adapt to changing conditions,” remarks Helen Armstrong. “Siloed data significantly reduces the data available for analysis, therefore limiting the ability to make well-informed decisions.”
Silos also lead to a lack of visibility and ability to predict, adds Zoe Wilson. “When you are analysing data, it’s in the past – it has already happened. Whilst it can still be useful to look at why something happened, it’s much more useful to make predictions based on data to implement strategies and policies that will really have impact.”
How do data silos impact employees?
Data silos risk damaging the employee experience. “Silos often result in repetitive data entry and a lack of real-time access to information, leading to frustration among employees,” comments Taryn Froneman.
Helen Armstrong agrees, adding that it can be very harmful to your employees and their overall experience. “The frustrations of accessing and sharing data can lead to wasted time, increased stress, and decreased job satisfaction.”
And it’s not just employee experience that is affected either. When data is siloed, it can impact on your employees’ ability to perform well and develop in their roles.
“We all know how frustrating the inability to access the data we need to perform our roles can be,” says Helen Armstrong. “The frustrations of data silos and having to jump through hoops just to get the information required to complete your day job can take a huge toll on morale. Your employees can’t be agile and perform optimally if what they need, isn’t there. Breaking down data silos can empower employees by providing them with the tools and information they need to excel in their roles.”
According to Taryn Froneman, employees’ personal growth can be stunted due to data silos. “Employees may have limited opportunities for skill development and learning when data is not shared across departments. Access to information and insights is important for personal and professional growth.”
She adds that silos can also impact productivity amongst staff. “Siloed data often leads to unnecessary tasks and increased manual data entry. This can lead to a decrease in productivity among employees.”
In addition, many small and medium organisations struggle with career and succession planning, yet these can be so important to retain talent, remarks Zoe Wilson. “Transferable skills for internal roles are often missed when you are looking only at your own department’s data – it’s harder to spot a career route or blockers when the data isn’t visible across functions, departments, or grades. This can result in people leaving your organisation rather than looking for internal routes to progress their career.”
She continues: “It’s also important from an EDI perspective to analyse performance and development through different demographics to remove barriers and consciously create support and opportunities. If you have a lack of women in your leadership team for example, who are you attracting for these roles, when are you losing people internally before their reach leadership levels, do you have pay gaps? All this data can be impactful and can help drive positive change for people.”
How can organisations break down silos?
It's crucial that organisations take action to break down any silos and better manage their data. This can be achieved by, for example, creating a robust data governance framework, so that clear policies and procedures for data management can be established.
In addition, it’s vital for HR teams to have a single solution where all the data that flows through multiple systems can be brought together into one place, where it is easily accessible, accurate and reliable. This single source of truth means that solutions can integrate seamlessly with each other, meaning that HR teams can make informed decisions about how to add value, as well as have complete visibility of how their time and resources are being used – and this can be a game changer in how HR manages both their data and their people.
“Having a single source of truth for data is crucial from an HR perspective, as it ensures accuracy, consistency, and the security of employee data, says Helen Armstrong. “A single source of truth also supports data-driven decisions; allowing HR teams to analyse people data alongside other vital metrics, bringing data to life, and allowing for informed choices to be made in terms of recruitment, retention and employee development.”
An integrated single solution can also boost the employee experience, adds Taryn Froneman. “Access to accurate data enables HR to provide better services to employees, from payroll to benefits management, enhancing the overall employee experience.”
The most important benefit of having a single source of truth is accuracy and efficiency, remarks Zoe Wilson. “We still see teams spending days trying to pull data together from disparate systems and work out why data doesn’t match up with the quarter before, or employees are missing as data is out of sync.
“When you are spending so much time just trying to get the data together, you don’t have time to analyse and use it effectively,” she continues. “When it’s there and you know it’s accurate, it makes the world of difference. It gives you credibility, time to use the data effectively, and the ability to start looking at the whole picture, not just parts or disjointed elements. You’re more likely to make better, informed decisions rather than making assumptions.”