An information silo, or a group of such silos, is an insular management system in which one information system or subsystem is incapable of reciprocal operation with others that are, or should be, related. Thus information is not adequately shared but rather remains sequestered within each system or subsystem, figuratively trapped within a container like grain is trapped within a silo: there may be a lot of it, and it may be stacked quite high and freely available within those limits, but it has no effect outside those limits. Such data silos are proving to be an obstacle for businesses wishing to use data mining to make productive use of their data.
Information silos occur whenever a data system is incompatible or not integrated with other data systems. This incompatibility may occur in the technical architecture, in the application architecture, or in the data architecture of any data system. However, since it has been shown that established data modeling methods are the root cause of the data integration problem , most data systems are at least incompatible in the data architecture layer.
In management the term silo mentality often refers to information silos in organizations. Silo mentality is caused by divergent goals of different organizational units. It can also be described as a variant of the principal-agent problem. Silo mentality preferably occurs in larger organizations and can lead to a decreased performance and has a negative impact on the corporate culture. Silo mentality can be countered by the introduction of shared goals, the increase of internal networking activities and the flattening of hierarchies.
Predictors for the occurrence of silos are
The term functional silo syndrome was coined in 1988 by Phil S. Ensor who worked in organizational development and employee relations for Goodyear Tire and Rubber Company, Eaton Corporation, and as a consultant. "Silo" and "stovepipe" (as in "stovepipe organization" and "stovepipe system") are now used interchangeably and applied broadly. Phil Ensor's use of the term "silo" reflects his rural Illinois origins and the many grain silos he would pass on return visits as he contemplated the challenges of the modern organizations with which he worked.