Enterprises need to think like startups and go bimodal: Gartner
By Edwin Yapp December 12, 2014
- Running traditional IT along with startup mode needed in today’s world
- Start small, have separate teams, educate stakeholders to make bimodal IT work
GARTNER Inc believes enterprise IT organisations need to embrace an agile, startup-like culture within an established organisational structure in order to adapt to new challenges and succeed in today’s increasingly competitive world.
Dubbed ‘bimodal IT,’ this emerging concept is being promoted by the Stamford, Connecticut-based research and analyst firm, and was the basis for its recently concluded yearly conference, the Gartner Symposium/ ITxpo.
Gartner believes that bimodal IT is about an enterprise that is able to function in two modes: The first is known as ‘traditional IT’ or Mode 1, which is IT operating within a pre-defined plan and is focused on stability and reliability.
The second mode ‘agile IT,’ or Mode 2, is a much more flexible planning and implementation of IT, which focuses on agility, flexibility, and being able to operate in an area of great uncertainty.
In Gartner’s scheme of things, today’s chief information officers (CIOs) need to create business operations that are both ‘rock-solid and fluid’ if they want to succeed in an increasingly digital business environment.
The rock-solid way of working is achieved with Mode 1, which seeks to keep established processes and IT implementations going the way they are. In comparison, fluidity is achieved by Mode 2, which gives CIOs the option to efficiently develop at the speed and agility they need to meet new digital challenges, said Gartner.
“CIOs can’t transform their old IT organisations into digital startups, but they can turn them into bimodal IT organisation,” Peter Sondergaard, senior vice president at Gartner and global head of research, said in a statement.
Sondergaard said he believed that digital startups already sit inside most organisations. They appear in the marketing department, in human resource (HR), in logistics, and in sales.
“IT leaders must design, resource and deploy for a world that’s digital-first. In this new model, every business unit is a technology startup,” he added.
In fact, Gartner says that 45% of CIOs state they currently have a fast mode [Mode 2] of operation, and that 75% of IT organisations will be bimodal in some way by 2017.
Elaborating on this, Gartner’s Andy Rowsell-Jones argued that businesses today sorely need this two-pronged approach because of the growing digitisation of business.
“The traditional way of making money is under threat,” the Gartner vice president told reporters at a media briefing in Kuala Lumpur recently.
“Businesses today need to create more than just products and services that sell, but also to be innovative [enough] to create ‘stickiness’ in customers and develop opportunities to monetise this stickiness.”
To support his argument, Rowsell-Jones (pic) related the oft-cited fortunes of Eastman Kodak Company.
For decades it dominated the market, but failed to innovate, resulting in the Rochester, New York-based iconic imaging and photographic company filing for bankruptcy in 2012.
The Gartner analyst said that while companies like Kodak kept things running as usual, they were slow in anticipating the threat of digital photography to its core business of producing images via film.
He argued that while it’s important for companies to keep selling to customers, they can’t merely survive in a digital world by providing the lowest possible price.
“You want customers to buy from you not because you sell at the lowest price but because you want to create stickiness – either by giving them a superior service or some other form of value proposition such as trust and convenience,” he explained.
Rowsell-Jones said that the opportunity is there for businesses to create this ‘stickiness,’ and even a whole new revenue stream, by giving them new access, products and services.
“Hypermarkets like Tesco and others, for example, have the relationship and [stickiness] with their customers,” he explained.
“This fundamental relationship could be a threat to traditional banks, for instance,” said.
This ability to create stickiness and ultimately yielding alternative forms of revenues for any business is the right implementation of bimodal IT, according to Gartner’s hypothesis.
Rowsell-Jones said that while Mode 1 is already a developed approach to IT, Mode 2 is about “building ripples and swimming with the changes.”
“It’s not about abandoning what Mode 1 is doing but about looking at separate rules such as market-testing half-finished solutions,” he said.
Asked how a company should approach these two modes, Rowsell-Jones advised them to start with an ‘island’ – a specially chosen project that is achievable and not too complicated to start with. This would ensure that success could be replicated in small steps before proceeding to bigger projects.
Secondly, it’s imperative to keep the Mode 2 organisation team separate from Mode 1 as the latter is likely to act as an impediment against the former, he said, adding that the Mode 2 way of working could be challenged by existing behavioural and protocols within the organisation.
“There is a need to educate stakeholders – in this case senior leadership – on the two modes and keep them from opposing each other,” he said.
More information from Gartner about bimodal IT can be found here (subscription required).
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