Bi-Modal: Low Value Hype or High Value Insight

As some of you know, my wife and I own a cattle ranch; Red Angus beef cattle. One of our registered bulls is Golden Boy. As you might expect from this,  I have become rather familiar with  real “BS” as contrasted to the far less real “stuff” many of us encounter close to daily in our business careers. Please keep that in mind as you read the following.

On November 19th, I was the “featured speaker” at the monthly meeting of the Fisher San Francisco CIO Forum – which I co-chair with Tony Leng of the DiversifiedSearch executive search firm. I hadn’t talked to the group (typically about 15-20 CIO actual attendees of the 50 or so invitees) in maybe 2 or 3 years.

My talk’s title was “New Skills for a New Age: Leadership Skills for Successful Innovation in the Digital Age” and within that context, I went on to discuss in some detail [1]-Leadership, [2]-Innovation, and [3]-Governance.  Along the way, I stated that a “Digital CIO” is “Bi-Modal” and uses digital technology to enhance company revenue. I mentioned, somewhat in passing, that there are two modes to “Bi-Modal” –

  1. Legacy systems
  2. Digital systems to enhance company revenue

… and the reaction from some of the CIOs present was not at all what I expected. One stated (at some length) that there was no such thing as a Legacy System and another (seated immediately to my right at the head of the U-shaped configur-ation of tables) said with some vigor that “Bi-Modal” was just Gartner “hype” and then went on to talk about all the new and amazing things he was doing as his company’s CIO.

As I listened, it seemed to me that he was doing a great job of presenting a close-to-exact example of the second form of “Bi-Modal”.

It seems to me that the term “Bi-Modal” is simply a new name for an old thing. Maybe the fact that Gartner is the one that seems to have coined it, is causing some CIOs to get upset, needlessly so, in my view.

Of course there are “Legacy Systems.”  Some folks might choose to call them something else but that doesn’t make their existence any less real.

Think of your Accounts Payable system, your Accounts Receivable system, your Payroll system, your General Ledger system (or systems at some unfortunate companies). Almost all enterprises have most of these in some form but they tend to be in the background or somehow so foundational that no one ever thinks about them. Yet, they are there; day in and day out; doing their jobs quietly with almost no maintenance. Since some are Systems of Record, we carefully back up their files – but none of these enhance our revenue or give us new forms of enduring competitive advantage. The latter is what Bi-Modal #2 systems do. The former are all examples of Bi-Modal #1.

The distinction is not unimportant. Increasingly, enduring competitive advantage will be found in highly innovative, technology-based, digital systems – all of which fall in the Bi-Modal #2 category.

For much of the last decade we have seen declining IT budgets. Only in the last year have I begun to hear of Boards pushing for IT budget increases – and not just in response to Cyber Security concerns. “Better” Boards of Directors and “Better” CEOs are doing two hugely important future-focused things:

  1. moving beyond “Quarteritis”
  2. pushing with real vigor for new forms of enduring competitive advantage; such as forms found with increasing frequency in highly innovative, technology-based digital systems.

Gartner can be an expensive and sometimes annoying company to work with, but it is rarely wrong. “Bi-Modal” is an important distinction and CIOs who ignore its imperatives are putting themselves and their companies at risk.

OFFER – If you’d like a copy of my November 19th presentation that caused all the uproar, please just ask. I’ll send you the version with the “notes” I used when giving my talk. Swiftest email is jim.spitze@sccsequoia.com