The term Bimodal IT was created by Gartner and MckInsey at the end of 2014, to refer to the idea that companies which aren’t born in the digital world must be able to work in two complementary work modes, which allow them to compete on equal terms with digital native companies.
Mode 1 provides a traditional operation for the most predictable areas of the company, where robustness and reliability prevail. Mode 2, however, is a much more agile operation for areas with a greater degree of uncertainty, where speed and adaptation to the new demands of the Internet prevail.
Encouraged by this idea, many large Spanish companies have been structured around these two modes, building IT organizations of two speeds: a first speed with mainframe technologies and waterfall methodologies to take charge of the core business of the company that, supposedly, is hardly modified over time; and the second speed with open-source technologies and agile methodologies, focused on the development of mobile and front-end Web applications, under the direction of the new CDO’s.
But, to what extent has this system worked?
Personally, this idea of two speeds within the same company has never convinced me. I think it is wrong for those who think that the core of their business will not change in the next 10 years, with the only justification that in the last decade it has not changed.
I also believe that it is impossible to create a group that works agilely within a company that works in a traditional way. It is very difficult for this agile group to work autonomously, and sooner or later it will be affected by dependencies with the traditional part of the company.
My opinion is unimportant next to Garner or MckInsey, but after several years working on processes of digital transformation, encouraged by some discordant opinions like Martin Fowler and also by some internal talk, today I dare say more confidently that idea of Bimodal IT does not fit, much less under the proposal that both modes should coexist in time in the same company.
I was fortunate to participate in the beginning of 2015 the creation of this famous mode 2 in one of the great Spanish banks. A small innovation team was created within the bank, supported by scrum and open-source technologies. The result was several pilot projects with good ideas in a few weeks, but when integrating these pilots into the bank … That’s where the problem came! We were hit by the reality of a bank.
Only small adaptations were needed in the core to be able to implement the projects in the market, but many of these projects did not pass that test. To try to eliminate frictions between the two work modes we try to implement the concept of the cultural bubble of Michael Sahota. Creating some figures that would act as a proxy between both worlds, so that the bureaucracy of the traditional world will not affect the agility of the new working group. A patch that did not solve the real problem.
I also had the opportunity to participate at the end of 2015 in a project to define the way of working in the new digital area of a major Spanish insurer. The decision of this company was to give this digital area responsibility for the front Web, using this new way of working: with new technologies, scrum, cloud, new tools, etc.
While the current departments would be responsible for the backend, maintaining the mainframe, the current hosting and waterfall methodologies of always. In this way, they covered the entire backend with an API so that these two work modes coexisted in perfect harmony. But after a few months we have seen that this does not work.
It is true that the front developments are much better, but the reality is that if the front is supported on a back that is not scalable or can be modified in an agile way, this front ends up infecting these problems. That is why this company has now gone a step further and we are helping them in an ambitious project: redoing thier mainframe with new technologies.
Finally, although I have not worked directly on the project, I know from my colleagues at Paradigma the experience of Lowi, the Vodafone virtual operator that was born at the end of 2014. In this project, an autonomous team was created within Vodafone that built the project as if it were a startup within the brand, with scrum, new technologies and everything hosted in Amazon Web Services.
In this case the division was not made by the type of software, but by business model, and it is this reason that has made the difference with the two previous examples. Lowi works as an independent company, a 100% digital company that was launched successfully after only 4 months of development and that continues to expand its offer in an agile manner.
My conclusions after these three experiences is clear: the digital transformation is not a department nor is it a technological update, it is a profound change, a revolution that affects the entire company from the CEO to the last call center operator.
From this point of view, the CDO is not the new person in charge of the websites of the companies or of the mobile applications as it is being understood in Spain, the CDO must be the catalyst that extends the germ of the digitalization throughout the company.
The big companies have seen in the Bimodal IT the perfect excuse not to make a deep change, not to lose their stagnant hierarchical structures and, above all, not to get their hands on the mainframe, their core business.
A kind of monster that is very scary, that has been growing larger for the last 20 years and that only a couple of people have seen from the inside. But today this situation is no longer sustainable or justifiable, the only possible alternative to survive on the Internet is to slowly flee from this monster, one step at a time.
A company cannot operate with two speeds in a permanent way. Mode 2 should be understood only as a first step for companies with years of history to begin a path that should inevitably lead to the whole company adopting the practices and technologies that come from the digital world.
During this transition period, which is essential in most cases, you should not create a two-speed company based on the type of software you manage, but it should be divided according to business criteria, otherwise mode 2 will always be ballasted by its dependencies with mode 1.
The correct way to approach the digital transformation is to draw up an execution plan that will transform vertical business lines, endowed with the necessary independence to digitize them from front to back, and thus gradually change the whole company.