Dual Operating System: For or Against Enterprise Agility?

By Ananth Subramanya, Sr. Vice President, Digital Business, HCLTech

It has long been a maxim for businesses operating in the digital age that agility is the answer to sustained success. According to recent research, 71% of organisations are adopting Agile, with 60% seeing an increase in profits already.

First introduced by the Scaled Agile Framework (SAFe) to empower enterprises to compete in the digital age, the dual operating system is one which fuses the stability of organisational hierarchy with the swift response ability of an empirical network. Although it has become incredibly popular among global organisations, with 70% of the Fortune 100 companies adopting it, we have collectively reached a saturation point when it comes to the dual operating system. This approach of SAFe where organisations can preserve strict hierarchy and, at the same time, embrace agility for customer centricity and speedy delivery hinders agility.

The question must be asked—is the dual operating system still relevant for businesses wishing to become truly Agile? While it remains the primary approach to Agile, for reasons outlined here, it is high time that organisations start looking for other ways to go deeper into achieving this agility.

Ways of driving enterprise agility in 2022

Implementing Agile is a complex system that requires significant changes in structure, strategy, processes, people, and technology. Let’s look at some of the ways to drive enterprise agility:

Accelerating technology: A common reason cited for continuing to work with a traditional model is that the legacy technology does not render itself to faster release cycles as well as continuous integration and deployment (CI/CD). Another argument against the dual operating system is that the cost of modernisation does not provide the ROI to invest. However, it should be noted that although the channels of composability and consumption have changed, technology remains their basic enabler. Teams can leverage advanced technology to develop CI/CD toolsets, even if the languages are of the third or fourth generation (3GL/4GL), to drive agility.

Being open to change: In an interaction with the CIO of a soft drinks major, we were challenged when we pushed for adopting enterprise agility as the enterprise did not want to change the business model as they believed it would not reap adequate ROI. This resistance to change resulted in slow releases, with a loss of significant market share and their share price dropping by 18% in the previous three months. To stay competitive in this rapidly evolving business ecosystem, enterprises need to be agile and prepared for changes and pivots. The opportunity loss of not embarking on enterprise agility will be high.

Agile system of records: A large telecom provider faced a major disruption in their manufacturing facility recently, due to a lack of agility in their systems of records. When the need arose to make a minor change in the system, it took the teams two weeks to respond, elevating the damage. To stay relevant, businesses will have to focus on introducing agility to their systems of records, and not just a system of innovation and differentiation.

Agility even with regulatory compliance: In the State of DevOps report 2021, it was stated how SOX compliance can be achieved without impeding compliance and auditing needs. For instance, the empowered Agile team of a large retail bank decided to circumvent the compliance need of providing test evidence, by going into production without any testing. Although this move was contradictory to what the regulators wanted, the team was able to stand their ground by building the capability to respond to any product issue or recommendations in minutes. The enterprise was able to drive one of the highest Net Promoter Scores (NPS) through their composable architecture and continuous deployment ability. To remain at the top of their game, enterprises need to drive agility even under strict regulations.

Referring to data: It is pertinent for businesses to drive this transformation to an agile model by baselining the existing data, the success rate and measuring it post-adoption. As stated in the State of DevOps report, an improvement in the DORA metrics will have a proportionate improvement in business value. Thereby, it’s pertinent to measure and report using data.

The dual operating model as a barrier to Agile

Although a staple for organisations starting with Agile, with time the dual operating system has proven to be inadequate in delivering value in the long run. Once an organisation takes off, the limitations imposed by the traditional segment are bound to clash with the empirical operations. For an organisation to truly become Agile, they must implement the relevant methodologies in every aspect of their operations, rather than treating agility like a one-off case.

How the traditional and Agile approaches perceive value is often incompatible, creating roadblocks in achieving a true Agile state. Although traditional organisations employ experts who can determine customer needs with their deep understanding of the market, the blueprint to deliver on these demands and measure the overall effectiveness is often unclear. In the forever-evolving market landscape, it is impossible to successfully predict what customers might find valuable. Also at times, customers themselves cannot know what they require unless they experience it.

In contrast to this, empirical teams employ Agile approaches like conducting proofs of concept (POC) with minimum investments to deduce value. The plan of action is set based on the learnings from these experiments. A traditional approach combining these dual discrete elements is often viewed by traditional organisations as unnecessary and wasteful. This approach, with its focus on structure and planning for success, collides with the experimental nature of the empirical segment, hindering the organisation’s capability to enhance agility. The benefits of changing to a system beyond the dual operating system manifest in unique traits that truly Agile organisations display today.

The Agile organisations of today and their characteristics

The truly Agile organisations of today are the ones with the ability to react and adapt the fastest in this ever-changing business landscape. These organisations are customer-centric, with an eagerness to thrive in complex and often unpredictable environments.

These enterprises characterise themselves by emphasising their focus on building a network of empowered teams comprising technical experts, that work collaboratively to deliver optimum results. These teams run on a shared impetus which leads to swift learning and decision-making times. From purely mechanical entities, the new Agile organisations have transformed into living organisms, constantly evolving, growing and adapting to changing circumstances.

Such Agile organisations often show traits unique to their way of operations. They are as follows:

A binary approach- The new-generation agile organisations are driven by stakeholders guided by a shared vision. These organisations thrive in the highly competitive business ecosystem by early detection and seizing opportunities through insights from the examination of customer feedback and product reviews. Company resources are allocated effectively following a standardised and swift process.

Network of authorized teams- To stay ahead of competitors, Agile organisations rely on a network of teams with the authority to make decisions. These teams are structurally flat, with members having well-defined and accountable roles. They operate in synergy and maintain high standards of transparency.

Fast learning and decision cycles- Agile organisations follow performance-oriented, standardized methods of working that encourage constant learning. Decisions are taken swiftly based on insights derived from a transparent information system.

Empowered people- Agile organisations are defined by a community of dynamic employees possessing an entrepreneurial drive. Employees have ample opportunities to move horizontally and vertically between teams and roles on the basis of their development goals.
Helping organisations on their journey to become truly Agile- The HCLTech advantage

Although transforming to an Agile framework comes with its own set of advantages like lower risk and enhanced business value, global organizations have found it challenging to embrace this transformation and fully reap its benefits.

HCLTech has helped organisations transform seamlessly to an Agile framework through our three-step approach supported by phases of standardization, transformation, and optimization.

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