The Dual Operating System in Practice

“Leaders have to do more than simply say ‘we have two systems.’ They have to actively steer the organization so it’s both robust and free to innovate.” - Stephan Neck

What happens when an organization outgrows the myth that “all you need is cross-functional teams”? In this episode of SPCs Unleashed, Stephan, Ali, Niko, and Mark dig into the Dual Operating System—the concept that healthy enterprises need both a stable hierarchy and a network of agile teams. Balancing these two “systems” can be tricky: too much network, and chaos creeps in; too much hierarchy, and innovation stalls.

The group shares real-world stories where line managers struggled to find their place in an agile environment, and teams were forced to “figure out” things like career growth, performance management, and compliance. The central point? A thriving enterprise can’t ignore its operational backbone or the people who keep it running—yet it also can’t let old school structures choke the flow of value.

Key Highlights

• Hierarchy Still Matters: Killing off management leads to confusion, with nobody taking care of essential processes or people’s long-term growth.
• Network for Speed & Innovation: Agile teams excel at quick delivery and iterative feedback, but that alone can’t address bigger structural needs.
• Role of Leadership: Far from being “evil,” leaders must shift focus—away from daily task management and toward supporting employees’ development and well-being.
• Avoid Over-Fluffiness: Simply “trusting teams” without clarifying accountability and career pathways can create a ticking time bomb.
• Concrete Mechanisms: Allocating a fixed budget or “time code” (e.g., a 10% buffer) ensures capacity for improvement and competence development in the network.

Actionable Insights

• Involve HR Early: They offer critical expertise for dual reporting lines, role clarity, and setting up the right systems (e.g., Workday, SAP) to support both hierarchy and network.
• Formalize Time & Budget for Growth: Reserve capacity for improvement and cross-team learning—otherwise urgent priorities push it aside.
• Educate Managers on “New Leadership”: Shift from daily control to integrator responsibilities—connecting people across silos and guiding their professional journeys.

Conclusion

Embracing a Dual Operating System means recognizing that “manager” isn’t a bad word—hierarchies can be powerful for stability and talent development, while agile networks spark rapid innovation. With the right balance, clear processes, and respect for both sides of the coin, enterprises can keep their core strong while racing forward into new possibilities.

References

Six Simple Rules by Eve Morieux and Peter Toolman

Transcript

Mark Richards: 0:01

You're listening to SPCs unleashed a shaping agility project that emerged from the 2023 Prague safe summit. The show is hosted by Swiss SPC, T Stephan Nick and Niko kaintances, Dutch, spct, Ali Hajou and Aussie safe fellow, Mark Richards. We're committed to helping SPCs grow their impact and move beyond the foundations taught during implementing safe each week, we explore a dimension from the frameworks competencies. We share stories about our journeys, the secrets we found and the lessons we've learned the hard way. Go G'day and welcome to another episode of SPCs unleashed. We had a few in a row at the start of the year, and that life got in the way, and we've been missing for a couple of weeks. Either that or tonight's topic was so scary, we decided we needed three weeks to prepare for it instead of one, because tonight, we are going to tackle one of the most confusing things safe talks about, well, that's what my clients tell me anyway. So we are in the capable hands of Stephan Neck, who is going to take us into the world of the dual operating system. Over to you, Stephan.

Stephan Neck: 1:12

Thank you very much. Mark, yeah, dealing with the dual operating model or dual operating system has two sides, right? It's the model the system and dealing with it. So what's the challenge? We have a dynamic network of people focused on changing. The business is about change, and there's the run, stay right, where you have a stable, functional hierarchy focused on operating and growing a successful and sustainable business, and you have to adhere to legal stuff, you have to be profitable, otherwise you run out of money where there's no cash, there's no business. So how do we deal with operating in a simultaneous way? How do we increase one of the core competencies, organizational agility, right? Faster response, innovation, disrupting states, all that comes together. And it's a people business. It's people doing the work they have to do, decision making, and now within this field of tension, how can we really assure that we have better customer focus, that we have really a good response time? So let's talk about those two sides of the cone of the coin. And if I say coin, I mean what is a viable system for an enterprise performance? And I tried to frame that a little bit for this session. And now back to my mates. Let me hear your initial thoughts or share first insights based on your experience with the dual operating model. Who would like to pick up the talking stick. Niko, go for it.

Unknown: 3:05

I'm happy

Nikolaos Kaintantzis: 3:06

with starting with no bashing. That's cool start for me. I'm always surprised when people take it too seriously. For me, it's just a change management trick. You need a dual operating system, dual operating system, to make some concepts clear, and that helps you start. It's really a concept to start. It's not something to believe in it and to install it. It is a change management trick. So you can start with things that are important for you, and that's the flow, and it's the network. It helps you starting with that instead of changing the whole organization. So that

Stephan Neck: 3:40

sounds interesting. Yeah,

Mark Richards: 3:42

Mark, I'm curious. I'm curious. Niko, right, starting with but what do you do once you started? Do you still need it? Did not need it. Do you live in a pure network and forget about the hierarchy? No,

Nikolaos Kaintantzis: 3:54

no. Also, hierarchy is really an important part, because you have parts in the hierarchy which we will never have in the network. So, for instance, people development. So if I let's, let's go back, back, back when I started with Scrum, there were a fraction of people saying, you don't need any hierarchies anymore. The team can do everything self managed, and everything is perfect. And I never believed that because developing a career or moving your skills is always something outside the system you are in. So if, as a Niko, decide, I don't want to be a developer anymore, I want to be a scrum master, a coach, or whatever the scrum team will say, I don't need you. I need you as a developer so you never have the chance to develop yourself. So you will always need some kind of a hierarchy, or at least the skills that are in the hierarchy. And it's was never, in my case, in the in the in the in the network. So what do I do with the question? With the hierarchy? I will start changing them too, but I don't tell him them in the beginning. I. So.

Mark Richards: 5:01

So the thing that like just jumped out to me when you said dual operating systems useful in the beginning, but is is unlike Well, what do you do after the beginning? What makes the dual operating system no longer relevant?

Nikolaos Kaintantzis: 5:13

So what really happens is, after a half year, nine months, people are realizing the hierarchy needs also change, but then I have the capacity also to see how can I change or bring the hierarchy in a different mode. But the, let's call it the lie of the turnover, hurting system, telling them I will not touch you, gives me the chance to be faster with my network. So I will start doing also change management on this part, on the hierarchy part too, but I don't start with that, because when I start with a welcome, I will change the whole company. I will can just go back to the next door and go out again. Interesting

Stephan Neck: 5:52

discussion. That's why I love my mates, right? So probably over to you, Ali. I saw in your notes some interesting aspects, and I'm sure Mark will poke some holes as well.

Ali Hajou: 6:05

Oh yes, I've, you know, the dual operating system has kept me awake for very often, because it is it gives a name to a challenge that I think everyone faces whenever we're talking about agile at scale, whenever talking about safe or whenever we talk about just having a lot of agile teams. You know, the agile teams themselves whenever, especially whenever we have a small little company like a startup. You know, a team might be the entire company, and therefore there is less of a need for standardization. And, you know, having rules in place for how to recruit people and ways to perform and gear reviews and so forth and so forth. But you know, that's whenever we talk about a company that is 10 or 15 people in size. But what if we have a company that is 10,000 or 15,000 people in size, then you need certain skills and capabilities as a company to to be able to run the company sustainably, to have some agreements over the different departments or divisions or business lines. And the thing is, with with Agile transformations, with, you know, implementing safe and that becoming sort of the standard for the network organization, how we call it, there's just a lot of topics that we typically do not talk about. We love these iterations. We love these short, you know, the short cycles, quick integration and all that stuff, stable teams, you know, with all kind of engineering disciplines and competencies all in one team. But then how are we going to make sure that all of the, you know, test professionals in the different teams are aligned with each other, that they can learn from one another over the entire sort of horizontal axis of the organization. You know, that doesn't happen automatically. And I've learned over the time that, you know, we're very it's very simple to say, well, you know, the team will figure it out. That is true whenever you have a startup, but whenever you have a huge company, you know, there's just a lot of additional processes and additional, yeah, I don't know, things to think about. And just dumping all of that onto teams is a huge and over the top amount of cognitive load that they then also need to think about and also need to organize. So the dual operating system and the top topics that I'm going to going to talk about is really, I think, the biggest challenge that an SPC will go through, because it goes beyond just this, you know, starting agile teams, helping them out, and Scrum Masters and product owners, and then a train and the first bi planning. It goes way further than that. It's really embedding that type, type of concept into the the big and nasty and sometimes difficult and chaotic and sometimes bureaucratic context of, you know, an enterprise,

Stephan Neck: 9:23

interesting curveball you through. Ali and I had the opportunity this week to talk to leaders at the University in an executive master course. And when I came into that room, already, some people were in there. They had hoodies on from the university, and if they turned their back on the back, it was leading change. And I started the lecture with guys, what are we talking about today? And they looked at me, looked on the, on the on the program, and said, Yeah, we're talking about a secondary organization that helps us change how we act now and how we will. Future Proof. And I said, Okay, how would you summarize that in the shortest possible sentence? And it was, there was silence in the room. And then all of a sudden, one of the guys stood up, turned his back towards me and said, Here it is leading change, right? So interesting stuff when it comes to the two sides of this coin, of the dual operating system. Mark your initial thoughts about this topic. So

Mark Richards: 10:29

I gotta be honest, when the dual operating system slides came into safe and I can't remember, like it was, like, say, five, maybe I saw those slides and I went, finally, we've got a great way to talk about this, but because, if you think about the problems we've been talking about, they've existed as long as Agile has existed. Because agile says Create cross functional teams, and you instantly have a clash between the hierarchy, where people are, you know, line managed by somebody who's in their discipline, and then you're putting them together in teams who have a day to day focus based on their mission. So it's an old problem, and you know, there's always the interesting things you've got to lean into, right? What happens to the traditional leaders? What's the job they've got to do? How do you look after people's need for craft and to be able to talk to people like them? And the dual operating system came along. What a beautiful, elegant way of solving the problem. And then I looked a little bit deeper and went, Okay, what do you practically do with it? It's really cool to have these diagrams. I had a problem because if I was talking to non technical people, the idea of a dual operating system didn't resonate for them. They couldn't I remember dual birding between OS two and Windows many, many years ago, right? But it felt good. And I looked at safe, and I went, what do you do with this? Practically, yeah, that wasn't there, right? And then I went, I'll go read the Cotter book, right? Because, because that'll explain to me what you do with this. And I read the cottage book, and I went, Well, that doesn't really look like safe, right? To me, my summary of the CO book was like, here's how you motivate people to share focus with the work they do on the side of their desk. So, you know, have you got an issue that says I've got these kind of two parallel ways working, yes, if, for me, it kind of distills down to and coming back to a viable system for enterprise performance, right? People need clarity. Fundamentally, any of these operating models will generally mean you wind up with two bosses, right? And, and whether or not you think of them as, you know, I work for my scrum master. And, you know, if I say, Well, I work for my scrum master, then every scrum coach out there is going to go, boo, hiss, yeah, that's the, you know, you don't work for a scrum master. They're meant to be a servant leader, right? Well, do I work for my product owner? And most agile people will say, No, you don't work for your product owner. Do I work for my boss? Well, my boss isn't meant to be given like just humanity for people on the ground is to go if I potentially, when I turn up to work, have multiple bosses. How do I know what to expect from them and buy the same token for the leaders in the organization, if they're living in this world where they're potentially leading people who perceive themselves as having multiple bosses, how do you give them the clarity themselves to understand the way they need to adapt their leadership style to live in this duality?

Nikolaos Kaintantzis: 13:37

But the cool thing is, with safe, we realized there is something we have to do, even if it doesn't give us enough tools and enough recipes or no recipe, at least you're aware of the situation, and that's why I always say if you want to continue as an SPC, the next thing for me, in my opinion, is becoming a systemic Coach or becoming a realization developer, which is outside safe, and at least this slide you see gave us the awareness that it's more than just doing, doing Scrum, doing safe, doing whatever. It's something around us. It's a system that's interesting.

Stephan Neck: 14:17

That's why I, like my mates, they already took over the moderation, because if you listen carefully, we're talking about, how do we create a valuable system that runs the business and grows the business, right? So listening to mark, it's about clarity, because if you just throw in the dual operating system to change agents. And if, even if it's a framework, it's not a recipe, it's a framework. But you should have some some frame. You should have some guidance how to operate that, because it's called an operating system, right? And if I don't know how to operate some stuff, how can I. Change an organization, right? So throwing back the talking stick to you guys, if you think about and now we might combine two things. We have a challenge, getting a viable system for enterprise performance, run the business, grow the business, and what are the really big, big challenges we we face with that dual operating system being in the framework, and let's be, let's be honest as well, what works what doesn't work. So between those two questions, having something that really works is viable, and challenges, let's, let's, let's open the table. Let's, let's lay it on the table. Ali, you're nodding with your head

Ali Hajou: 15:46

yes. Let me just deep dive in what I I think, in the past, I've had a moment where I call this the ticking time bomb. It basically means, if you don't do anything, this is going to explode. Um, why? Because whenever we talk about agile teams, agile release trains, we're talking about self organizing structures, and they've been very successful for very long. That's why we have this podcast, even that's why I have a job. It's, you know, it's, it's, it has proven to help people and organizations to work together in delivering cool stuff, new products, new services out there in the market and maintaining them for a very long period of time. It works, and it has been working forever. However, whenever we only focus on product owners, Scrum Masters, agile teams, pi planning, and inspect and adapts that kind of stuff, story points and whatever we're missing. And, you know, the other half of the company we're missing, the part of the company that has been there in, you know, you know, operating the company. And it would be very foolish to say that, well, we can ignore that. You know, things will change automatically, and people adapt and so forth. And it's Well, in my in my experience, that is just simply not true. Going into an Agile Governance model, if I call it like that, takes away responsibilities that were typically part of certain roles. Line management, in the past, have been working with with teams that were calling themselves resource managers. They're not bad people. As a matter of fact, they were some of the most loving people that really took care of their people, of their own, engineers, their direct reports. And whenever we have stable teams, whether it is stable agile teams or agile release trains or whatever, then, well, we don't have to do anything about resourcing anymore, because people are part of teams and it's a stable team for a long period of time. Sure, there is some competence development. People might grow into a role or grow into, you know, have have career opportunities to do something else, somewhere else, in another train or another department. But, you know, maintaining overview on that and remaining in control of that is a skill in itself, and it's I just I haven't been able to see or find good examples in which everything, including the transfer of people, career development and year reviews and that kind of stuff, Performance Management, if you call it like that, there would that it's done by the team members themselves. It is, it is something that needs to be managed, and therefore, you know that means that the role of the so called Resource Manager, or the line management changes, and not having an answer for them, or working with them to be as effective as possible in this new world with Agile Release Team trains and agile teams and so forth, it just, it's a recipe for disaster. And hence, this was, as Mark mentioned, I think was a good opportunity to open up that discussion and finding ways to involve line management and all of the organizational structures, to keep the hierarchy stable, keep the organization stable, to involve them into the change and understand what their role is in increasing the agility of product development in the organization. And it's just not doing that. It's just, it's, it's, again, a recipe for disaster.

Nikolaos Kaintantzis: 19:51

And what I like when I listen to you Ali, is there are so many, many interests in a company, and you cannot all anything fulfill in you. The network. So you said about growing people. It's also one of my examples there. So if you want to have a proper career, you need this element. It's usually not in the in the in the train or in the team. So going back to your question, Stephan, you have one on the one side, you need to be fast. You be able to organize and reorganize. And this reorganization, doing the right things, doing the right things fast is important. But if you do only things fast, you need some kind of hygiene. And this hygiene part is, in my case, in the hierarchy part, because they are doing it more efficiently. They care for, yeah, for hygiene. And also have in my trainings an example which is a little bit scary, why I need hierarchy. And the topic is sexual harassment. You cannot let a team solve themselves sexual harassment. You will need hierarchy for that. So don't tell me you let victims and and and the grassroots, being together in one room, and say, solve it yourself because you're agile, it will not work. So for all those who said, Oh, what Ali is saying is our fluffy things, you can do anything in the in the in the in the value stream, no, you can't. You need hierarchy. You need a hygiene. You need efficiency. And that's all in the other part. That's why I need both coins. They're both both sides of the coins.

Stephan Neck: 21:23

And I think you, you summarized it nicely, principle number 10, organize and reorganize around value. Sounds. Organization doesn't happen magically. We need leadership in there. Let's, let's turn our focus towards what are then the biggest challenges you faced in the past with the dual operating model system. Who would like to start?

Mark Richards: 21:47

I'm going to jump in here, and I think it's probably the best way for me to start is to go, who was I in the beginning of my agile journey, which is probably what fed these challenges, right? Because in the beginning of my agile journey, right? What was Scrum? Scrum was you don't need managers anymore. And as a young typical developer, my life sounded great. And then I went and I got my scrum training in America, and they went, there's no team roles anymore, but you identify as a team member, so there's no hierarchy, there's no team roles. It's just people turn up and do what the team needs and and, you know, as a young, highly technical person who'd never really cared for the process side of life, this was a panacea to me as like a world with less managers slowing us down from building good software. And it was, was like my early agile days were pushing management out of the way to go, just get out of the way and let the team get on with the job. Stop doing this. Stop doing this. Stop doing this. And I think a lot of agile coaches do the same thing. It's like, just push the managers away. Push the managers away, let the team do it. But there's a truth that says, well, those managers, they're really skilled people, right? Who've got a lot of value to offer. And it's very easy to say, Stop doing all of this stuff, as opposed to going actually, if you look at it in a positive way, what are things you should start focusing on, because if you actually look in like in a traditional model, before you start playing with a dual operating system, the role of a manager is a really challenging one, because it's not just make sure your people are doing the right thing. It's make sure your people are safe, make sure they have career paths, make sure they're feeling challenged and having opportunities to grow. You know the list goes on and on and on in terms of your responsibilities to those you lead, your responsibilities to the organization on behalf of those you lead and getting worked up right and most leaders, particularly in the kind of junior to middle management, have spent so much of their life drowning in just keeping the lights on that they've never had the like. And you speak to most of them go, Oh, I know I should be doing more one on ones. I should I know I should be focusing more on career development. I know I should be. I know I should be. And there's a whole bunch of things they know they should have been doing but they haven't had time for and then all of a sudden we go, actually, all this stuff that's been really time consuming for you your entire career as a leader. You leave that to the Scrum Masters and product owners and tanks. You've now got time to do all these things that you know you should have been doing all along. But the truth is, has anybody developed their capability to do that? And you suddenly get somebody who, you know they haven't built the skill to be a purely hierarchy leader, with the day to day running of the business being done elsewhere, and there's not a lot of agile people out there who'll go out and offer you training in. How to do that. In actual fact, an awful lot of the Agile people are out there will say, well, management's evil. Not only Won't they help you build the skills, but they'll get in the way of it. And that, for me, I think it's doing the leadership development to actually let the new world work well and to support your leaders in growing into their new spaces. For me, that's one of the biggest challenges that you've got to face into what

Nikolaos Kaintantzis: 25:28

I love when you're listening to mark is you have to start thinking, how many times a dear audience, I imagine you've been Scrum Masters or coaches on scrum level, on Kanban or whatever, how many time you just flow, went with the flow. We just do it, because you do it. And to be honest, long, long time agile was on the, on the on the, on the bigger side of power, because you do it agile. Agile is important. Management is bad. Leadership is the right word. Managers are the bad guys. Who are, who are? They hurt people. And leaders are leading people, and you just go with the vocabulary, without thinking. And I think if you work with the dual approaching system, you should start think again. What think again? What is the purpose of what you're doing? And exactly, management isn't something evil, it's really important skills where we have there you work with people. And sometimes I really got sick by listening to the other coaches just repeating vocabulary. So really, a lot of you guys listen to you because it really makes you think about what we try to to achieve here. What was the question? Sorry,

Stephan Neck: 26:37

you're right. The question is, what's the biggest challenges you faced exactly. Just mentioned it. That's good. That's good.

Nikolaos Kaintantzis: 26:44

Thank you. And for me, one challenge I always had with the dual operating system, where people thinking now I have to install it and now I have to leave it forever. And as I said in the beginning, is for me, it's just the start. And the biggest challenge was to say it's not something like the new operating system. You have to do an update on your organization and install it, and then it's your solution. It's just a vehicle or a starting point. That was my biggest challenge. Thank you, Stephan, for reminding again, may

Stephan Neck: 27:11

I pick up what you just said, Niko, and I've seen that over and over again. People try to find the solution to install something, and if you look closely, it's the line organization. They try to immediately, kind of fix how we are organized. The question is, do the customers? Do the markets care about that? No, they have triggers for us, and they want value increments, right? They don't care. And I recently joined a training where we talked about some basics of organizing the enterprise or entities, and we went through a overview. If you start with a startup, it is very integral. A few people know what they do. They churn out value increments so they stay alive. And then it gets too big, right? All of a sudden, too many people crisis of fragmentation, and you try to create something like this line organization in a functional way, right? And over the time, when you look at how you create value, there's a crisis of responsibility. Oh, developers should have done a better job so we can do a good job in testing, right? Or logistics, says guys, what crap do you deliver? We can't chip that right? And what then happened? And you guys mentioned it, this famous matrix appears out of the blue, right? And we have crossing points, crisis of coordination again, is it now? My line manager, is it? Is it change? What is it right? And we always try to fix that over the line organization. And if it gets even bigger, we create huge divisions. You have groups of business units, and then the crisis of steering. And now we come up with the dual operating system where we say, hey, it's a network. Find your way, right, collaborate, coordinate. But if you have a huge network, and that's what I face now and then, is people tell me, Hey, where's my where's my home? Where do I belong to? It's an identity crisis. So biggest challenge for me is we try to fix something that shouldn't be fixed by organizational units or forms of how you how you organize, that it's, it's more like something else that we should bring in that's, that's my five cents to to this topic. Ali, biggest challenges, yes,

Ali Hajou: 29:48

and my five five cents is the fact that we remain so fluffy about it. It's, you know, if, if, I mean, imagine you're a line manager, you have the formal response. Ability for the well being and the development of 20 people. Okay, those 20 people have a career. They have standards to adhere to. They have needs, and all of that needs to be taken into account. And then all of a sudden we have an Agile transformation, and we say, You know what? Yeah, yeah. Figure it out. You know, those agile teams or whatever, yeah, we will organize trainings for them, and the rest, you know, you figure it out. It's unfair. It's unfair to these people. So my challenge is the fluffiness, what I what I think is required is clarity. Clarity, such as a train has will reserve 10% of its capacity for competence development, which basically means it's not just enablers or technical enablers. No we need to spend, spend or at least reserve about 10% of the capacity of the train to be able to become a better organization, and therefore the line manager is an actual stakeholder of the train, to think along on how to align the train with all kind of organizational structures and whatever, and make sure that the train is up to date with respect to policies and so forth and so forth, how they're going to do that that's completely contextual. But I think we need to become way more sharp in the guidance, the responsibilities on how you know, the hierarchical part of the dual operating system works. I think that's my biggest challenge.

Nikolaos Kaintantzis: 31:50

Oh, sorry, Mark, what I also personally think what we have to do is educate people more. So this whole series is called unleash SPCs, but we have also unleash them and bring them, let them learn new tricks. And I think maybe it's completely new, new, new podcast about about that. So it's really more than just unleash it's really learn new stuff. And that's why I think, personally, as an SPC, my advice would be, go around, make your community of practice. Talk with people who are change managers or coaches or organizational developers, because it's a new discipline, not COVID and safe, sorry Mark,

Mark Richards: 32:27

I was going to pray, right? Because the, you know, the 10% or no carving time out for people who are and let's be honest, right? The dual operating system, you'll have people who don't exist in the network, you'll have people who only exist in the network. You'll have people who kind of exist in both. But if you think about the people who live in both, and going, here, we're going to give you 10% to focus on your hierarchy world, perhaps it's your craft development standards. I mean, that's been an old trick we've all used for years and years and years. And the interesting thing was always going, well, what's 10% really right? Is 10% guesswork, and you trust everybody to be well behaved and self manage it is 10% you've got some way of tracking it. And, you know, I saw a lot of people try a lot of different experiments back in the days when we actually worked together, as opposed to everybody working remotely. And I've seen that, you know, really common thing we did of, you know, carving out percentages of time to be spent living in the two different worlds has become harder and harder since COVID. Have you guys found any tricks for making the 10% because I'll often, I'll say, I'll talk about 10% everybody will laugh and go, yeah, we've been trying that for years. Have you guys found any tricks that you'd offer to SPCs for making the 10% stick or, you know,

Stephan Neck: 33:55

make it visible. Just visualize that you really reserve that time and bring it on the table and talk about it. And what I've learned this week talking to leaders again, is there a ha moment. This is a duty on our side, to lead that change, to lead how you deal with the tension between the hierarchy, the primary organization, which is the line organization, and how we deal with change, right? And I think if that's my trick, if it's a trick asking the change agents to ask the right questions, again, to leaders and surface it, to where it belongs and how they should deal with it, right? Ali, if

Ali Hajou: 34:44

I Yeah, if I may, I've had the lucky opportunity to formalize something like this, real hard. And how did we do that? This was an organization that uses SAP for time writing, yeah. And we've managed to create a WBS, which is, you know, code that you use to write your time on for it. Everybody hates time writing but, but nonetheless, that was the reality over there. So time writing had to happen until we have a, you know, new organization wide stand other, other tools standard. We managed to create a WBS for, we call that process improvement. So that meant that the line management had a budget on which people could spend their time on process improvement, which was basically, it wasn't, it wasn't, you know, just processes, but it was also ways to collaborate. It was things like hackathons, where all of a sudden could be organized without anyone, you know, project leads or a budget holder being like, hey, wait a second. You're hosting hackathons and, you know, fun and games on my budget, because that didn't happen anymore. Yes, because, you know, everyone spent the time which was budgeted for process improvement, which was perfect for line management, because they had a new way to to, well, standardize is not the right word, but to govern, even protect competence, development, and be able to write that in a very formal way. So because there's indeed, always the fight of, you know, how many, how much capacity can we spend on enablers? And then at the end of the quarter, you'll see that all of those enablers have been carefully, sort of pushed aside to make room, or all of the other more visible project stuff. And so by making this extremely hard in the sense of line management had a budget and a WBS or a time writing code for specifically these things, it worked beautifully because the fluffy semi handshake approach it just, you know, in moments of stress and chaos and priorities and escalations, these kind of things are being moved away. I

Stephan Neck: 37:17

love it. I love it. But guys, we have the weekly challenge of Niko jiggles, assuming the dual operating system or model was a children's fairy tale, which one would it be? And because you challenged us, Niko, you're the first to go.

Nikolaos Kaintantzis: 37:35

I had the biggest challenge myself is usually I thought, if I look at every fairy tale that Disney makes a movie out of it, it really changes the character of the fairy tale. So if you go to grims, fairy tales, you always have evil has to die, really. It has to die because it's a it's evil and it deserves so. If you go to the Seven Goats history, the wolf dies in with stones in the stomach, you always, yeah, the evil has to die. In grims and in Disney fairy tales, you always have a happy end. And sometimes the dual operating model seems like a happy end. It doesn't have to die. Don't take me wrong, but I don't want to have these happy endings, and that's why it's every Disney movie that is based on a grims fairy tale that's, in my case, the fairy tale that's symbolized the dual operating system. Please. No happy ends.

Ali Hajou: 38:29

Ali, your fairy tale dual operating system. I was thinking about two sides, two things that somehow need to collaborate. And I, I ended up with the tortoise and the and the hair cool, because on the one hand, you had speed and consistency, and on the other, if I mean the one hand, you had speed, and the other one, you had consistency, sort of determination, discipline. And the thing is, in order to get far, you need to you need to need both. So that's what I got

Stephan Neck: 38:59

interesting. I choose the goose that laid golden eggs, and the farmer was, was a dumb farmer. He killed the goose to get more golden eggs out of it at once, right? So for me, it's, it's between nurturing the goose, don't kill it as long as it lives. And this balance between short term wins, long term wins and again, that leads back to hey, let's have smart leadership, and it adheres or it pays into what you said. Mark right capabilities of leadership. If you detect them that they are there, use them if they are not there. Please invest right? Because leadership is crucial to deal with the challenge we have Mark,

Mark Richards: 39:51

you know, chatgpt was, as usual, very helpful to me in responding to Niko. I've ran. With Rumpelstiltskin. And if it's been a long time since you're a kid and you've forgotten Rumpelstiltskin, the very short version is there was a miller who boasted about his daughter's ability to weave, and the king heard, and the king demanded that she weave impossible things, or there was going to be a horrendous punishment, and she was panicking, and Rumpelstiltskin, this little imp, comes along to her and says he can help her do it, but she's going to owe him in the future. And she's she's caught between responding to the king's demand and between knowing that there'll be a price to pay in the future to the Imp and and there's no right choice for it. And of course, you know, they figured out a happy ending to it in the long run there. But I think for me, for a lot of people living in this world, they can feel like they're very much torn between two masters. And you know, if you're very people centric, right, how do you create a world where people don't feel that

Stephan Neck: 41:05

interesting? Thank you very much. Dual operating model talks about hierarchy, the robustness. It should be stable. It talks about the network. There's a lot of collaboration. And let me steer our attention back to how do we, kind of, like in a body, install a system of neurology, how you steer, how you communicate, how you make it work. Because a little bit of anatomy, it's just bounce and and and flesh, right? A little bit of process is physiology. Yes, blood is running through this body, but there's much, much more. And what does that mean for us when it comes to the dual operating model? Ali, would you kick it off?

Ali Hajou: 41:57

Yes, and I'll try to keep it short, because I I'm very, very, very much hoping that people are going to read a book that I'm going to refer to, which is a book from Eve Morrie. He, he was a consultant or partner at one of those big consulting firms, but he wrote a book called The six simple rules, the six simple rules. And it is really about simplification in a world of what he calls complicatedness. Complicatedness, we'd like to take that away. And in that book, he obviously describes six rules, and one of them is the rule of what we call management, in a world of complicatedness that includes, and that's how I sort of perceive it, the world that is existing in the Web that has been casted between the two operating models, and in that book, he describes that the manager should be like a people's connector, a person who is who has the responsibility to connect people from a more, let's say informal side, in the sense of making sure that we that we learn from each other and from a more, let's say technical side, so that whomever is building something is going to talk and communicate and interface with some somebody else who is building something else. That's why he also calls them, that these managers are integrators. They should their job is actually to integrate the different departments, to identify boundaries and try to work around them. And I think that had that resonated so well in, in, let's say, the the how to perceive the dual operating system that I thought, rather than trying to explain the all of the tricks that he describes in that book, I'll just refer to that book interesting.

Stephan Neck: 44:16

And you brought up this, this keyword integrator, and it calls for leadership, right? So I highly second that leadership is crucial. We just talked about it, and we will come back to leadership again, because I want to know from you guys, what you think is, if you can do something magically, what you would do. But before we do that, let's, let's stick with when it comes to steering, when it comes to, and I would throw in the word control as well, because in German, control controller has a bad connotation. But to control something is something really helpful for an organization. And you brought up this. Keyword integrator, and I see another picture arising mark.

Mark Richards: 45:07

I must confess, I haven't read that book, Ali, but I just bookmarked it. I think the first thing for me is you've got to deal with the mom and dad situation, right? And this is both communication, decision making and but the mum and dad situation. Anybody who's had a kid knows this system that you have to promise to back each other up, but when one parent makes a call, the other one has to back them up, and your kids very rapidly figure out who's likely to give them the answer they want to hear,

Stephan Neck: 45:44

right,

Mark Richards: 45:45

right? And they know that if they can get a call made that that is the one they want, then the other parent's going to have to back it up, because they know the rule. And as parents, you've got to become hypersensitive to recognizing when the moment is I'm going to have to talk to your mother about that first. Or have you talked to your mother and not letting them get you trapped right, and knowing when that, when you when, when you're in that dangerous territory, and having the right level of communication between each other as parents to to actually be consistent with the calls and to check in when you need to check in. You know, it's probably tried to parallel this. But I think if you think about a world of multiple leaders, and the need for you to have that same ability to have each other's back, but also to have the sensitivity to be thinking about, Oh, is this a call I need to check in on before I make it super important. And I think the second one for me, again, in both decision making and communications, is a little bit like back to Ali WBS right build deliberate protocols. It's wonderful to go the people will make the right decision and just have the right people in the room, and magical happen. But you've got to build the capability for that. You've got to build the capability of knowing who the right people are to have in the room for a given conversation. And some people will find it more naturally than others. So getting in there and building the pro like if you told me in my early agile years that I would have ever think running a RACI workshop was a good idea, I would have laughed so hard, right? Because RACI was almost like a swear word to me in my early agile days. I can't tell you how many role clarity workshops I've run just because people want to get the conversation in to go. We know where the boundaries sit, and we know the systems. Yes, you want them to evolve. You don't want them to be stuck in stone, but you do want that extra level of clarity and formality to help you build the habits Exactly. Otherwise,

Ali Hajou: 47:56

it's unfair. It's just unfair. Yeah, we just, you know, let people use in this new world, and people might not be, I don't know educated enough in the in this new way of working. It's just unfair to be like, you know, the rest of the world is working in a completely different way, and you just try to figure it out. Look,

Mark Richards: 48:18

I've, I've worked with a couple of clients, one in particular who took all of the network ideals too far and almost abolished the hierarchy. They were really unhappy places to work because everybody was empowered and nobody could make a decision,

Nikolaos Kaintantzis: 48:36

something just in too much democracy. When I listened to Mark, I had a question for the audience this mommy, daddy principal, how many times you as a coach said, Oh, I would have said yes, but let's, let's ask management first. So we laughed about about about the story, but we're doing this all the time saying, oh, as an Agile coach, as a scrum master, as a product owner, as a PM, I would have say yes, but let's ask evil management first. So like me saying, Oh, I'm from Daddy, I say yes, but let's ask mommy, because her words count. But I would have said yes, but she has a cold, and it's not fair. It's really if you let's say, let's take a question with me. Let's discuss it with the people, with all the people, including me, who are responsible, and give you the answer instead of I would have said yes, and question to you, dear SPCs, how many time you just blamed management and said, Yeah, I would have started said, Yes. Thanks, Mark.

Stephan Neck: 49:28

Besides all the good tips and tricks and hints that we talked about, let's bring in some magic again. And with the magic, let's try to focus on perhaps one or two things that you would use as a magic wand. If you could use it, where would you use it and how would you use it to best leverage effect that you have an organization that masters the dual operating model, being consistent, being proficient, and also. Being adaptive to innovation.

Nikolaos Kaintantzis: 50:02

I think in my case, I would just want to have more courage in the people. I don't know if it's a Swiss thing or or a culture thing we're having here. It's always backing up, having perfect plans. Always try to understand what dwell operating system is, exactly what this is, exactly how could an art slicing thing look perfectly or has less risks. I understand sometimes you don't want to go blindly somewhere, but between blindly and having a perfect plan, which is never possible because the world is spinning too fast, I would love to have more courage. So people saying, let's try it out, and we will not a loser leg or whatever, maybe a scratch, but we can heal afterwards, and that's what I would like to magically have more courage on several levels, not on your management level.

Stephan Neck: 50:53

I'm looking over to Mark, all right, okay,

Mark Richards: 50:56

I'll take the key out for me. It's, it's about as early as you can in your journey getting your HR people involved, right? If you're a change agent, you're an SPC, you're a coach, get HR in because I'll almost guarantee that they've forgotten more about the way operating systems work then you will ever learn, and you need that brain. You know, I as a coach. I come from a product development background. I was a software engineer, and I've studied agile online, right? I never went and studied HR. I've learned about it by osmosis, to an extent, I've learned a lot about it by coaching people from an HR background, so get them involved early and apart from anything else, like even a little thing. And my favorite example on this front is how to find somebody, right? If you're in a big organization, how do you find where someone lives? You get the name of somebody. You go, I wonder who that is, and you look them up and what we do over here, and I assume it's similar for you guys in Europe, you look them up in Outlook, and you go, who do they report to? And who are their peers, and who reports to them? And that's why you figure out where they live in the organization. And you got a clue who you're about to go and talk to. But guess what? What you just got was the hierarchy view of the world, right? You don't know what team or art they're part of. You don't know what value stream they belong to, and which conversation you're trying to have with them. But if you get your HR people involved, they will say, oh, there's ways of doing that, right? If you look at, let's say workday, which is one of the very common, popular HR systems these days. Workday enables you to have dual reporting lines, and you know, a simple thing like that, of being able to go the systems, the HR systems, the organization, can recognize your home, and people can find out where you live through the infrastructure of the world. That's awesome right now, I'll tell you now, with all my Agile and Lean background, I never, ever would have thought of that answer until an HR person went, Oh, yeah, we can do that.

Stephan Neck: 53:18

I can second that. Uh, Mark, I learned a lot this week talking to HR people, talking to architects who have ingenious pictures of landscape. Where are people working? What are they working on? From a technical viewpoint, I talked to leaders, and the interesting thing was, during coffee breaks with leaders your system, no matter what it is, if it's an operating system, if it's a future system, there's two ways you can get there, or you can operate it, either magically something happens, but that's not steering the stuff, or you as a leader, you understand what's happening, and you start steering. And the question was Niko in some of these discussions, Does, does change management or this, this second part of the coin disappear at the given time? No, it doesn't. It's always two sides of the cones coins, means leadership is constantly involved. And this aha moment this week in discussions with leaders. Hey, we can steer, but if we don't, perhaps some stuff will happen we can't control. And I asked them as well. Okay, always ask yourself the question, what would happen in the organization if I'm away on a six month sabbatical? Are we still successful? Why does it need me, or is something missing if I'm away? Right? And that's interesting to see that leaders then go into. This mode of leading change, starting, mastering the dual operating model, no matter how you design it, how you operate it, but you have to operate, otherwise something happens that you can't control. Let's finalize the famous just one key takeaway. The race is on. Who would

Mark Richards: 55:20

like to start. I'm gonna start. Don't try to kill your hierarchy. You'll regret it.

Ali Hajou: 55:26

Nice. I think I have something very similar, which is that we please, please, please, pretty please. With cherry on top, should move a little bit away from the lovey dovey agile story about mindset and teamwork and doing and being my mindset and, you know, caring for each other, all of that is correct. However, on this topic, this is about early clarification of roles responsibilities, adjusting control processes and ultimately, people's careers. So be careful with this.

Nikolaos Kaintantzis: 55:58

And from my insights, the dual operating system is not the goal. It's maybe a starting point, but not the goal.

Stephan Neck: 56:04

And I picked up a Willie Nelson song, don't break your eggs. To count your chickens, keep it a living system that really produces value, and with that talking, stick back to Mark.

Mark Richards: 56:18

All right. Thank you. Stephan, well, this was a very don't be too fluffy week after we've done a few episodes talking about coaching and facilitation, which, of course, is all about fluffy. Well, kind of all about fluffy. We're going back next week because it feels like, you know, we just love facilitation coaching too much. And next week, we are going to talk about our favorite tools for remote facilitation. What are the tricks and tools we found to make for richer experiences and give us more freedom to focus on what's happening in the room. So look forward to lots of URLs, links, screenshots and other things of the tools that we've found to help us facilitating great remote events. In the meantime, thanks for joining ideals.