Silo mentality is a condition in which there is very little information sharing between departments. Instead, department managers tend to hoard information, using it as the basis for the accumulation of power within the organization.
Silos contribute to a sharp reduction in efficiency, since employees are more likely to be working with outdated information and may be discouraged by their bosses from working with other departments. This situation can also result in longer processing times for standard business transactions, since each individual transaction is more likely to pile up in front of the next department in line that is supposed to process it further.
In addition, since there is little discussion across departments, it is much more difficult for management to build a consistent culture across the organization.
The silo mentality is caused by the organizational structure, when a business is designed to focus activities within departments. Thus, the problem is both caused and can be resolved by senior management.