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Organizational silos that build on the existing organizational structures are often considered to have negative effects in the form of focus on private narrow objectives and organizational fragmentation. To avoid such harmful outcomes, competence management is called for, and in this, the human resources (HR) function takes a key role. Among other things, it can provide basis for emergence and utilization of communities of practice (CoPs) that build on common interests and effectively cross organizational boundaries. These features of CoPs allow them to carry competences and ease knowledge transfer and to break down the harmful isolation. Quite paradoxically, the challenge is that CoPs can also form within silos, thereby strengthening isolation, and HR as a utility department can itself be particularly prone to the silo effects. Examination of boundaries and silos through an original study conducted in a Finnish energy sector company suggests that HR managers need competences outside their own expertise area and courage to augment their CoPs across the functional boundaries to break out of the HR silo and to assist other functions to do the same.

The study is based on qualitative research data gathered in four focus group interviews with HR personnel from an energy sector company in November 2012. Totally, 19 professionals were interviewed (five HR partners, five talent development and performance managers, five vice presidents of HR and four HR managers) in the four focus groups. The company’s HR personnel represented units from Finland, Sweden, Poland and Estonia.

Examination of boundaries and silos in the Finnish energy sector suggests that HR managers need competences outside their own field (e.g. knowledge of the business and offerings of the firm) and courage to augment their CoPs across the functional boundaries to break out of the HR silo and to assist other functions to do the same.

Research provided that CoPs can have different effects on silos. As they are capable of crossing organizational and functional boundaries, they may effectively mitigate adverse silo effects; however, if CoPs are formed within silos, they may strengthen isolation and fragmentation. In addition, utility departments and supporting functions are particularly prone to the risk of CoPs forming within silos. The HR function is one manifestation of this. Paradoxically, it also has the potential to enhance the other type of effects that CoPs can exert, as competence management can be used to foster intentional and self-organizing CoPs that counter silo effects.