We all know that we need business agility to thrive in this current state of business and the digital age. Business agility is the ability to change and accelerate in this digital age. The dual operating system is one of the key concepts shared by John P. Kotter in his book ‘XLR8’, for the success of achieving business agility.
The Problem: The problem is not that businesses do not understand the need for change and do not wish to change or they are not making an effort to change. The problem is that most of organizations are still using the old managerial frameworks to manage the transformation. The old managerial frameworks are slow and do not fulfill the need to accommodate the speed of change. In this digital world, the needs of customers are changing faster than the business is able to fulfill them.
Most of the startups are focused on customers with a very lean hierarchy making the decision-making faster which leads to success by fulfilling the need of the customers at speed. As we know for a successful business, minimizing the decision latency is the key. As the startups grow and they become big, they start building more and more hierarchies for stability and execution. As a result, the network of teams around which the start-up used to deliver the value now disappears and the decision-making is slow.
We need to accelerate to be innovative, and productive, satisfy the customer need in time and have profitable growth. Due to the heavy hierarchies and bureaucratic culture, the speed of innovation is stalled by a limited number of change leaders, silo parochialism, pressure to make numbers, and complacency or insufficient buy-in.
The Solution
“The solution is not to trash what we know and start over but instead to reintroduce a second system — one which would be familiar to most successful entrepreneurs. You need a dual operating system.” — John P. Kotter, from his book XLR8
Scaled agile framework (SAFe) explains that one of the most important changes is understanding that for survival, we need to establish what Kotter refers to as a Dual Operating System. This operating model balances two needs:
1. A dynamic network of people focused on changing the business — developing, evolving, and maintaining new and innovative business solutions
2. A stable, functional hierarchy focused on operating and growing a successful, sustainable business that legally and profitably delivers these solutions to the market Without Dual Operating any scaling model will be a guaranteed failure.
Responsibilities of the Hierarchy
The responsibility of the hierarchy is to have functional managers and leaders, including activities such as financial and legal governance, people operations, production, and more. One of these responsibilities is to consistently, sell, produce, deliver and sustain the products and services its customers require to do their business. These responsibilities are addressed by a set of Operational Value Streams that manage the flow of value from receipt of order to delivery of goods and services and collection of payment for same.
Responsibilities of the Network
The responsibilities for the network are much narrower, as it is focused on product research, development, delivery, and evolution. While it is far from a trivial task—and indeed the enterprise's success is fully dependent upon it—it is a single and focused set of responsibilities. To fulfill its mission, the network is the home of the Development Value Streams that define, design, produce and deploy new innovative digital solutions.
Shared Responsibilities
Set of shared responsibilities that align the Network and the Hierarchy. These include Strategy – A single strategy and vision align the purpose and activities of the Network and the Hierarchy. And it’s not simply strategy. The dual operating system must also be continually aligned on Investment Funding, Agile Portfolio Operations, and Lean Governance. Each of these is described further in the Lean Portfolio Management competency in SAFe.
Customer engagement – The Hierarchy provides the sales and delivery functions that attract and retain customers; the Network engages with customers early in development and ensures that they are delighted by the new products and services.
Support – The Hierarchy typically provides maintenance and support, consulting and advisory services, and community engagement. The Network is also directly engaged in supporting and maintaining existing products and services.
Culture – Culture, of course, is shared. Although cultural norms and expected behaviors can vary somewhat based on the nature of the work, successful companies have a unifying culture that encompasses what they do and what they stand for.
However, the Network and the Hierarchy are not “separate” organizations; instead, they are two sides of the same coin —the Enterprise. Almost everyone in the Enterprise will interact with and be involved in both the Network and the Hierarchy.
About Advance Agility
We, at Advance Agility, are the new-age Agile Coaching, Consulting, and IT services company. We enable end-to-end Digital Transformation. Agile execution is integral to our being. We are doing SAFe implementation with small, medium, and large organizations across the globe. Our vision is to be the leading Agile execution player globally. To keep adding value at every process stage. We are on a mission to empower our clients and move from concept to cash in the shortest sustainable lead time by adopting the human-centric approach to business agility. Embracing change is in our DNA.
Things that keep us apart are Quicker and Seamless execution with an End-to-end gamut of services. Our Global presence and Stellar Track Record give us an edge over our competitors.
Connect with us at advanceagility.com to learn about SAFe and SAFe Implementation. Write to us at contact@advanceagilty.com for any agile training or consulting needs. We are always looking for competent agile trainers as well. So if you are a good trainer or want to become one, do get in touch with us to that we can learn, grow and achieve together.
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