Gartner calls it bimodal IT, McKinsey a two-speed IT architecture. Regardless of the exact term, these luminaries recognize that IT organizations simply cannot transform into digital startups overnight. Nor should they, as there are significant investments in core systems that remain critical to business function.
Bimodal IT allows organizations to embark upon their digital journey without completely changing or disrupting what already exists. Mode 2 innovation teams sit alongside, and augment, mode 1 teams, allowing each to focus on what they do best. According to Gartner, “In Mode 1, IT operates traditional IT services, emphasizing safety and accuracy… Mode 2 emphasizes agility and speed, like a digital startup.”
This description raises an important point that deserves further elaboration: the desired end state for mode 2 is starkly different from traditional IT. Furthermore, mode 2 embodies a core set of capabilities that are essential to becoming a digital enterprise; and all people, process, and platform decisions should be made with the goal of realizing these capabilities and delivering a portfolio of innovative applications.
In this series, we’ll explore each capability in detail. First and foremost, let’s talk about enabling effective collaboration between business and IT.
Digital innovation is a team sport
“Business and IT executives drive digital transformation better together than they do apart,” said George Westerman, Research Scientist for MIT’s Initiative on the Digital Economy, at the recent MIT Sloan CIO Symposium.
That’s because at its heart, digital innovation happens at the intersection of a business person with an idea and someone with the technical aptitude to bring it to life. Digital innovators, therefore, bring business and IT together in a collaborative environment that unleashes creativity through fertile cross-pollination of business ideas and technical possibilities. They’re able to quickly build prototypes to test and validate ideas, working in rapid iterations and scaling once success is proven.
5 Tips for Enabling Effective Business-IT Collaboration
As we alluded to earlier, though, effective business-IT collaboration is enabled by the right people, process and platform. Here are five tips to help bring business and IT together:
- Establish an innovation desk – There’s typically no shortage of ideas within a company, but do employees know where to bring them? If they don’t, these ideas are much more likely to die on the vine. Therefore, it’s important to have a clearly defined person/place within your IT organization for business people to go when they have ideas.
- Build small, cross-functional teams – We recommend creating small, cross-functional teams of tech-savvy business people and/or business-savvy tech people. These business engineers are more business savvy and user focused than many traditional programmers, giving them the right mindset to bridge the gap between business needs and technical possibilities
- Embrace agile, iterative development – Because requirements for digital applications are often fuzzy and fluid, an iterative development process like agile/scrum is crucial. Teams should be able to work closely with end users to identify and refine requirements on the fly, by creating functionality, releasing it, and iterating continually based on user feedback.
- Provide a common language for business and IT – Have you ever seen an end user looking over a developer’s shoulder at lines of code? Likely not. Model-driven development is a far more effective approach for enabling business-IT collaboration. Business engineers can literally sit with users and discuss functionality in human-readable form, gather feedback, and make changes on the fly.
- Work together on-site and meet often – Ideally, the team is physically onsite with the business, meeting often and delivering frequent iterations based on user feedback. This daily access to business stakeholders is key to reviewing progress, discussing new insights or ideas, and ensuring everyone is on the same page. It’s all about enabling interaction and creativity to innovate faster.
Business-IT Collaboration in Action at Arch Re
A great example of effective collaboration between business and IT is Arch Re Facultative, where a team of two business engineers built an engine for automatic underwriting of reinsurance. The team worked collaboratively with business experts for general business requirements, as well as program experts for client-oriented input and feedback, delivering the application through weekly iterations.
A great deal of creativity was required to bring the manual service online. For instance, after discussing with the business about how the system should cope with inspections, the team come up with the idea of defining risk areas, such as flood zones, using Google Earth.
Phil Augur, former COO of Arch Re Facultative, commented at the time that, “the application implementation cycle with the Mendix is the fastest I have experienced in my entire career – it allowed us to visually model incredibly complex application logic right from the beginning of the process and in a way that anyone can understand.”
Shortening the Path from Idea to App
Effective business-IT collaboration, while always important, carried less urgency in traditional mode 1 IT because the projects were well understood, with clearly defined requirements driven by IT. Mode 2 digital applications, on the other hand, are business-led initiatives with unclear requirements that must be delivered quickly and changed easily over time for competitive advantage.
Collaboration between business and IT, is therefore crucial to shortening the path from ideas to applications in order to drive digital innovation. In my next post, I’ll elaborate further on the need for rapid time to market.