While a team is small, new knowledge spreads with almost no effort. Everybody hears everything, everyone supports every project, and active work gets discussed with the whole team as a matter of course.
As a successful business grows and the new hires keep coming, that changes. Somewhere past 15 to 20 people, layers are added and new teams form, and meetings stop involving everybody. Discussions narrow to a few people, and fewer of them hold the information that client success depends on.
I’ve seen agencies drip-feed a client small changes until a key person is back from leave, because they’re the only one who can make the bigger decisions.
That's key-person dependency, and in a growing digital business it rarely arrives as a crisis. It builds gradually, through decisions that made sense at the time, until knowledge silos have formed around a handful of people the rest of the business relies on.
Where it tends to gather
Client relationships
Clients are often given a primary person to contact within an agency. Teams change often, so agencies maintain an account lead who builds rapport across regular catch-up and status calls. Client history, risk tolerance, stakeholder details, business goals and longer-term plans sit with that one team member.
That makes annual leave a challenge to plan around, and turns offboarding into a genuine risk to the client relationship.
Estimating and pricing
One or two specialists hold most of the knowledge here. Either the account lead owns pricing based on the client's budget, and estimates are created to fit it, or a senior member of the delivery team ballparks the work the client is asking for and suggests a timeline.
Either way, the reasoning sits with one person, and most people don't understand how the figures were reached or what to do when they later need adjusting.
Over time, a gap can open between the people doing the work and the approach the planned margin requires.
Technical decisions
As teams form and projects are given owners, the shared knowledge about technical decisions and fragile areas often settles with the most senior member of the team. Why things are done the way they are. What can't be changed without bringing down the whole house of cards. How to explain behind-the-scenes work to the client.
For anyone else, taking on support of the system becomes a steep learning curve with hidden costs.
Commercial and operational knowledge
Long-lived projects collect complexity as they go, with more dependencies, more suppliers and more special arrangements. How these came to be, when they expire and what the agreements actually say often lives in one person's head.
Without them, keeping the balance of dependencies right becomes slow and fiddly to manage.
Why growth causes it
Most of the structural decisions that lead to silos were good ones when they were made. An agency that does good work and keeps clients happy tends to win more of it, as word spreads and momentum builds. At first the extra work is absorbed by adding people to existing projects, or spreading a client's work across more than one team. That holds up for a while, until the business has to start organising itself differently.
In a smaller team, knowledge sitting with one or two people is often an advantage. Roles are still being defined, and a quick yes from someone everyone trusts keeps work moving while approvals still need to feel solid. Nobody needs a process for a decision when you can ask the person who knows at the next desk.
Growth changes how the team is put together. Roles become more specialised, so people go deeper into one area and see less of the rest. More of the week is spent apart, and hybrid working removes many of the conversations people used to overhear in a shared office, which carried context from one person to the next.
Ownership needs a mention of its own, because it's usually introduced for good reasons. Giving someone a client, a product or a system to own builds accountability and pride in the work, and clients like knowing who to call. The side effect is that each owner builds a deep understanding of their own area and a thin one of everyone else's. The same kind of work starts to be done several different ways, and credit tends to follow individual achievement rather than shared results.
None of these decisions is a mistake. Between them, though, they reduce the routes knowledge used to travel along, and judgement that once spread across the whole team stays with the few people who were there when it formed.
How to spot it
A few patterns tend to appear well before anyone notices the problem, and most can be spotted during an average week:
- People invited to meetings 'just in case'
- Work that's on hold because specific people are on leave
- The delay between a new starter joining a team and being able to make decisions
- Estimates and commitments that get reviewed after the fact
- Teams handling the same kind of work in different ways
What helps
Most of what helps comes from changing how existing decisions are made and shared, rather than restructuring the business.
Avoiding solo decision making on anything that matters is a good place to begin, along with recording the reasoning behind important decisions so it builds into a reference others can use later. It helps to notice which decisions only go well because of who happens to be in the room. That often becomes clear when someone senior is on holiday, and I've written separately about what a senior person's absence reveals about a team.
Client contact can be shared between suitable team members, so every account has more than one relationship, with a consistent client communication model and documentation keeping the client's experience the same whoever they speak to.
Sole ownership can be removed in areas where tools and processes make sharing practical. Estimation is a good example, along with supplier and contract renewals, which can be tracked in a shared register rather than one person's calendar.
On long-term engagements, bigger decisions can be made by a small group rather than one person, which gives a more balanced view and spreads authority across the team.
Checklists are rarely the whole answer, because they only cover situations someone has already run into.
What it means for growth
The first place this is often visible is capacity. The tacit knowledge needed to win, price and run the work belongs to the few people who own the relationships, are trusted with estimates and pricing, or keep the systems running smoothly. Every new client or project needs some of their time, and there's only so much of it to go round.
It also affects how well the business copes with ordinary disruption. Annual leave has to be planned around particular people, and when one of them moves on, a client relationship or a piece of system knowledge may well leave with them.
For owners thinking further ahead, there's a financial side too. When a buy-out or sale comes into view, key-person dependency has a tangible effect on what the agency is worth, and sometimes on whether a sale is viable at all. I've seen more than one agency sale stall because too much still depended on a handful of people, and too little of it was written down anywhere.
Concentrated knowledge can be hard to see from the inside, partly because the people holding it are the ones best placed to notice. An outside perspective can help find where it sits and decide which bottlenecks to tackle first, which is what my Delivery Health Check is designed to do.
As those people share the reasoning behind their decisions and step back from some of them, more work can flow through their teams without them being pulled in several directions at once. They get to take a proper holiday, and the people around them get the chance to build judgement of their own.
