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Breaking Silos

Breaking Silos · Part I: The Case

Chapter 1

The Garden

My children were playing in the garden. Both had the same set of big plastic bricks, and both were building. Separately, backs half turned to each other, each with their own plan. My son was building a castle. It had to be tall, because knights are not impressed by low walls, and his knights were getting ready for war with the knights of the neighbours' boy. My daughter was building a shelter for her dolls. Against the rain and the snow, which we hardly ever get in the Netherlands, but that has never stopped a five-year-old architect.

They built and built. And then the bricks ran out.

Every parent knows what came next. Two half-finished buildings, one small pile of bricks left, and a negotiation that took about four seconds to become a fight. Shouting, crying, a castle wall knocked over in the struggle. Two projects stuck. Two builders furious. A garden full of bricks, and somehow not enough of them.

Then my wife walked over, took each of them by a hand, and did something I've been thinking about ever since. She didn't split the remaining bricks. That would have been the obvious, fair, useless solution: two unfinished buildings instead of one. Instead, she looked at the two structures with them. My son, it turned out, only cared about the outside and the top. That's where knights stand, that's where the flag goes. He wasn't using the inside at all: you can't fight from inside a wall. My daughter only cared about the inside. Her dolls needed a dry room. And they were afraid of heights anyway, she explained.

The bricks are the same bricks.

So why don't you build together? One building. His walls and towers on the outside, her rooms on the inside. You have different goals, but the bricks you need are the same bricks. Build together and the castle gets higher than he could ever build alone, the shelter gets bigger than she could ever build alone, and nobody has to cry over the last pile of bricks.

They looked at her. They looked at the bricks. And they built it: the tallest structure our garden had ever seen, with a dry and spacious apartment inside, defended, I was assured, better than any doll had ever been defended before.

Here is the part that matters: neither of them gave anything up. This was not a compromise, where both kids trade half a dream for peace. My son's castle got taller, because it now stood on a shared foundation. My daughter's shelter got safer, because it now had walls built for war. Two goals, fully intact, both further than either could get alone. With the same bricks that five minutes earlier were too scarce for even one of them.

I stood in my garden watching two children do effortlessly what most of the economy cannot do at all. And the question hasn't let go of me since. As an entrepreneur, as a CEO, and in the end as the reason I build the companies I build: why don't we work like this?

Why do companies on the same industrial park each burn gas to make heat, while their neighbour vents heat to make nothing? Why does a refinery blow CO2 into the sky, while forty kilometres away greenhouse growers burn natural gas just to make CO2? Why does every organisation I have ever worked with sit on data that would be worth a fortune next door, and guard it like a state secret while it earns nothing at home? Why is "we ran out of bricks" the end of the conversation in business, when in my garden it was the beginning?

We built our economy on a simple assumption: resources are unlimited as long as you pay for them, and growth is the only goal. Every company optimises its own building with its own bricks. When the bricks run out we buy more, and when we can't, we fight or we stall. That the builder next to you, with a completely different goal, might need the same structure seen from the other side? Not taught in business schools. Not in any strategy framework. No line in the annual report.

And yet the overlap is not some side effect. It is almost everything.

Years ago I came across the work of professor Nico Baken of Delft University of Technology, who spent his career (at KPN and at the university) studying the economy as a network of sectors instead of a pile of them. He called it trans-sector innovation. In his lectures, Baken put a number on the overlap that I have never forgotten: only about three percent of the functions of a segment is specific to that segment.1 All the rest (the processes, the assets, the skills, the flows of material and information, the other ninety-seven percent) comes back in sector after sector. His research group mapped twenty years of transactions between more than a hundred clusters of Dutch economic activity and found what they call a full mesh: every sector already trades, directly, with every other sector.2 The connections exist. The bricks are the same bricks.

Put that back in my garden. Out of a hundred bricks, maybe three are the cannon only a knight's castle needs, and three are the tiny pink bath only a dollhouse needs. The other ninety-four are walls, floors, corners and roofs. Needed by both builders. Usable by both. Fought over by both. And in the economy, we built a wall between every pair of builders and called it an industry boundary.

To be fair, we did find a small piece of this potential long ago. Whole industries exist because some functions so clearly come back everywhere that serving them across silos became a business: accountants, marketing agencies, staffing firms, IT services. But put that cross-silo service economy next to the overlap Baken measured, and the conclusion is uncomfortable. Most of the potential (most of the ninety-seven percent) is still exactly where it always was. Locked inside organisations. Idle, wasted, or thrown away. While the builder next door runs out of bricks.

I have spent the years since testing that conclusion in practice. Some of it as a consultant and CEO, watching companies in energy, logistics and technology leave value on the table with both hands. Some of it travelling. In Africa I once watched musicians play a complete band, drums and all, built from two discarded oil drums. People who start from scarcity find combinations that people who start from abundance never even look for. And a big part of it I simply lived. Since 2016 I have stood on stages with a talk literally called Breaking Silos,3 and I spent the better part of a decade helping to build iSHARE, the European trust framework with exactly one job: letting organisations that have never met share data without giving it away. Breaking the information silo is not a chapter I researched. It is a chapter I lived, failures included, and I will tell it from the inside.

I started writing this book in 2018. I finish it in a world that spent those years proving the point for me. Europe now taxes the hidden carbon in imported steel at the border. Batteries sold here will soon carry a digital passport that shows their supply chain. Products made with forced labour are simply banned, whatever the price tag says. Data sharing between companies, the thing people called naive for years, is now European law. In 2018, "the true cost of your product will catch up with you" was an opinion. Today it is a compliance calendar. The silos are being broken open whether their owners like it or not. The only question left is who captures the value: those who learn to do it on purpose, or those who wait until a regulator, a competitor or a crisis does it for them.

So this is a practical book, and I want to be precise about the promise. I will not ask you to sacrifice your goals for the greater good. My son would never have taken that deal, and neither will your CFO. The whole method rests on the opposite, on what my wife showed in the garden: a broken silo is an exchange where both parties keep their own goal, and get further. In Part I, I show how we got stuck and why the walls are falling anyway. In Part II you get the method: a way to see your waste (thrown-away materials, vented heat, idle assets, unused talent, unread data) as a map of addresses in other silos where that waste is treasure, plus the design rules to build the exchange so it lasts. Learned as much from expensive failures as from famous successes. In Part III we take the method into the real world: a Danish town that has quietly been running the garden deal for fifty years, a pipe that carries a refinery's exhaust into six hundred greenhouses, a retired engineer who solved in months what NASA couldn't in thirty-five years. And just as carefully: the ventures that burned hundreds of millions getting the exchange wrong. The wrecks teach the method better than the trophies do.

The bricks are already in the garden. There are more than any of us can use alone. And most of them are standing still inside walls we built ourselves.

Time to break those silos.

Notes to chapter 1

  1. The 3% figure as stated by Prof. Baken in his Delft lectures and slide material (author's archive, 2017). Baken and Van Boven's published formulation is more cautious: "Only a small minority of the examined functions turned out to be sector specific" (E.F.M. van Boven & N.H.G. Baken, Trans-sector Innovation Framework, TU Delft, Network Architectures and Services, 2009).
  2. H. Wang, E. van Boven, A. Krishnakumar, M. Hosseini, H. van Hooff, T. Takema, N. Baken & P. Van Mieghem, "Multi-Weighted Monetary Transaction Network," Advances in Complex Systems 14(5), 2011, pp. 691–710. An analysis of monetary transactions among 105 clusters of Dutch economic activity, 1987–2007.
  3. BreakingSilos with Industrial IoT, IoT World Europe, 14 June 2017; Berkeley IoT Executive Course proposal, 2016. Examples then published at breakingsilos.org.
  4. Supporting evidence for the overlap thesis beyond the Delft school: McKinsey Global Institute (2017) decomposed the entire US economy into ~2,000 distinct work activities across 800 occupations; APQC's cross-industry Process Classification Framework describes 1,000+ enterprise processes in a single taxonomy valid across industries.