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3 Disadvantages of Data Silos That Slow Digital Transformation

Elizabeth Bell, Appian
July 14, 2023

Your organization has an unstoppable digital transformation plan—at least that’s what you thought before you started encountering the disadvantages of data silos. Your teams were fired up and ready to go, but data separated by different systems created obstacle after obstacle to your digital transformation dreams. 

Data silo disadvantages trickle all the way down from your first digital transformation meetings to the customer experience. Your technical and business teams try to collaborate, but first, they need data—getting that takes months. Your IT team attempts to build new solutions, but they have to tackle unmanageable data silos with resources they don’t have. As your business users wait for new solutions, they have to make guesses in their day-to-day work, and your customers feel the effects of it all. None of this looks like the glorious digital transformation you dreamed of. 

“Data is the fuel” of digital transformation, according to the Harvard Business Review. To achieve your goals, it’s paramount to recognize the most common disadvantages of data silos and overcome them. 

Common data silo disadvantages that prevent digital transformation.

1. Collaboration is hampered.

When a CIO sets up a digital transformation initiative, they need to bring different teams together. Business users and technical teams have to communicate about their needs and timelines. But existing data silos prevent the collaboration that’s essential to mapping out a new digital landscape and experience. 

The Harvard Business Review points out that “Digital transformation is not for the faint of heart — the unfortunate reality is that, to date, many such efforts, like transformation programs in general, have failed. Success requires bringing together and coordinating a far greater range of effort than most leaders appreciate. A poor showing in any one of four interrelated domains — technology, data, process, or organizational change capability — can scuttle an otherwise well-conceived transformation.” 

2. Managing data and systems is costly.

Data silos create unmanageable workloads for IT teams implementing new technology or building new applications. When huge amounts of data are siloed across disparate systems, IT teams have to create workarounds or simply wait for more resources to overcome the data bottlenecks. And the scarcity of technical database admins and developers can delay projects, strain resources, and prevent work on your critical digital transformation initiative. 

Data silos often mean IT teams have to deal with a growing number of systems with users who need different levels of access. This setup puts another burden on IT to ensure that users have the correct permissions, updating the licensing as new staff onboards, changes roles, or leaves. Business users have to wait to access the data that’s crucial to accomplishing their job. 

3. Business users can’t make data-driven decisions.

The third disadvantage of data silos is a lack of data for decision making. Instead of data-driven operations, you get guesswork. Business users are hamstrung by a lack of data. They don’t have a 360-degree view of operations because there's no single source of truth. Customers suffer the consequences of business processes, services, and products that are built on gut feelings rather than data. This is the opposite goal of your digital transformation initiative. 

If your organization wants to lead the market, you have to overcome these issues with a better data management strategy. 

A data fabric connects siloed data.

As you pursue digital transformation, you need a way to bring data together—easily and securely. And you need a better way than copying all your data into a warehouse or putting your valuable developers to work on API creation. 

Consider using a data fabric to stitch your systems together. With a data fabric, your IT team can pull from different data sources via a virtualization layer. Unlike a data lake, data warehouse, or data mesh, a data fabric layers on top of your solutions so that you can maintain your existing technology but have it work together. A data fabric gives your teams a complete view of organizational data and dramatically simplifies the process of integrating data systems. With that complete view of enterprise data, business users have what they need to make smarter and faster decisions. 

When you pair a data fabric with a process automation platform, your team can not only connect data but also swiftly build secure applications that help employees accomplish work efficiently. 

[ Want to learn more about how to solve your data silo problems and speed up innovation? Get the eBook: The Data Fabric Advantage. ]

Data is crucial to your digital transformation initiative, and you likely have millions of data points. They’re just out of reach. With a data fabric, you can harness the power of that data and use it to make informed decisions that help you lead the market. First transform how you use data, then watch as digital transformation follows. 

Discover how you can eliminate data silos with an integrated data fabric: Watch our on-demand webinar