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How Can CIOs Compete When Every Business Unit Is A Technology Startup?

by Peter Sondergaard  |  November 22, 2014  |  1 Comment

When you think about a digital startup, the first image that usually comes to mind is one of a loft-like open space populated by casually dressed smart young things with faces illuminated by the screens of their MacBook Pros jammed along communal tables. But stereotypes are always dangerous. What if I told you that you’ve probably got several digital startups in your own organization?

Right now, there are digital startups sitting inside your marketing department, in HR, in logistics and in sales. Leaders in those business units are driving their own digital innovation. They approach technology differently, trying new analytic tools, cloud solutions and technology services. And they’ve got a whole technology industry geared up to help them.

Every business unit is a technology startup

Technology providers are actively driving this change. Millions of salespeople, hundreds of thousands of resellers and channel partners are selling directly into business units, not just to CIOs or IT. That’s half of the technology industry’s sales capacity focused on also selling directly into the business unit! They know that IT budgets are only going to grow 3% on average in 2015, and they are looking for new sources of revenue within other parts of the business. And you know what? They are finding eager buyers in marketing, sales, HR, logistics and product leaders.

Enter bimodal IT

CIOs need to respond to this cataclysmic shift. And if CIOs can’t beat them, they can at least learn a thing or two from them. The answer is bimodal IT.

The IT organization can’t turn into a digital startup overnight and, besides, there’s a raft of business-critical responsibilities that it simply can’t (and absolutely should not) divest. This is the fundamental challenge for CIOs, but also the solution. Bimodal IT is a concept that helps CIOs address the intrinsic tension that exists between what IT needs to provide and what the organization needs to grow.

Mode one is all-things traditional, emphasizing safety and accuracy — what a traditional IT organization does best. Mode two is nonsequential, emphasizing agility and speed, like a digital startup. Put them together and what you have is bimodal IT. One organization operating at two speeds, but coordinating, communicating, leveraging shared knowledge and focused on one shared, not competing, goal; improving performance.

Sounds simply, but easier said than done? Absolutely! In my next post, I’ll dig deeper into how CEOs can work with their CIOs to achieve a bimodal IT organization and share some examples of organizations that have enjoyed early success with this approach.

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Category: symposium  technology-and-emerging-trends  

Peter Sondergaard
Former Executive Vice President, Research & Advisory
25 years at Gartner
29 years IT Industry

Peter Sondergaard was an executive vice president and member of Gartner’s operating committee. He led the company’s Research & Advisory organization until August 2018.

Thoughts on How Can CIOs Compete When Every Business Unit Is A Technology Startup?

  1. For me this sounds like an ‘in-between’ solution. I hate the term ‘start up’, but I definately recognize the situation you describe. In my opinion IT departments should move away from the way they did business before. The world has changed. Almost everything is available in just one click away. IT departments should adapt fully to this situation, otherwise they simply won’t survive. The bimodal mode you describe therefore sounds like a stage you have to go through in order to achieve your end goal. Looking forward to your next post on this topic (let me know when it is there).

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