What are the Data Silos and why are they harmful to business?

Have you noticed that, in most companies, the flow of information encounters constant obstacles? This is due to systems and applications not communicating with each other, setting up a Data Silos scenario. This directly impacts the effectiveness of decisions taken by business managers.

Data Silos create blind spots in business processes, miscommunication, and lost business opportunities. For this reason, they must be constantly monitored so that their data is integrated with the organization’s other systems.

Want to better understand what Data Silos are and what risks they pose to your business? So, read on and enjoy our tips to promote your organization’s data integration.

What are Data Silos?

Data Silos are formed when an organization has several computer systems, spreadsheets, and applications disconnected from each other. This usually happens due to issues such as:

  • data-driven management that multiplies the use of software;
  • technological incompatibility;
  • security barriers;
  • software incorrect architecture issues;
  • lack of IT corporate governance;
  • the monopoly of information in order to generate power for the individual or group that holds it;
  • The distinct physical location between the various databases.

Data Silos can also be configured by important documents stored in physical media in your company’s files, such as: contracts with customers and suppliers, which have important clauses to be fulfilled and which may be forgotten and without proper control.

Data Silos are known as islands of information, to express how there is isolation between data from each individual source. And this separation doesn’t make sense, since all the data belongs to the same organization.

What are the risks that Data Silos generate?

Data Silos can generate several risks that affect the competitiveness, profitability, and, in the long term, sustainability of a company. Among them are:

  • weakening of business strategies due to data fragmentation, which results in inconsistent or incomplete information;
  • pulverization of marketing actions and strategies;
  • loss of precious time and employee dissatisfaction having to mine data from system to system;
  • creation of a culture of information retention — due to managerial practices that favor individual performance over team success;
  • a mismatch between the features and benefits offered by its sales team and the actual deliveries of its products and services — eroding the company’s image;
  • vulnerability to digital frauds;
  • Financial losses due to lost sales, non-compliance with payment deadlines, lack of control in accounts receivable, non-compliance with contractual clauses.

Data Silos prevent companies from obtaining refined information capable of generating value for the management of the business — in addition to reducing the productivity of work teams. Identifying Data Silos and integrating the data they manage is the only way to have a complete and panoramic view of your organization’s results.

In order to avoid the concept of data silos, the basic thing that is required is to take the support of data lakes instead. Snowflake Data Cloud is one of the best platforms that eliminates the data silos and provides you the best data solutions for your business. For Indian startups, hiring or consulting with the best India Snowflake Companies can be the best investment for their business as well.

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