How the Business Owner Benefits from R-pM
Business owners have the most to gain from R-pM
Organizing the business for 21st century management with Result-performance Management (R-pM) slashes costs and compounds competitive advantage.
Business owners, from small businesses to corporate investors, have the most to gain by organizing and managing the business with R-pM. Owners reduce costs significantly by removing structures overlaid on the business that consume most of management and much personnel time. The business is simplified to essential outputs of value in results, performance solutions utilized that incur costs, revenue and performance and investment capital of worth, related enterprises, and management time periods. Information systems can be simplified to result-performance management systems. Owners eliminate the information mess and use real business data in the value of the results produced, full performance costs, the value added to results, and the real worth of their business and the capital they use.
Management and staff are focused on producing valuable business results. Routine administration is replaced by capital management to provide qualified performance solutions needed to produce results. A result manager is responsible for each result and a performance manager is responsible for each solution provided.
The business strategy is defined as a strategic business structure that defines the strategic result value to be created and the strategic performance solution investments needed that are justified by specific result value. Business owners and executives are responsible to manage by time period for current results against goals and performance against expectations with current estimates for strategic results and performance solutions.
Most business owners think that their business is organized and managed
Business owners are under the impression that the business that they own is organized and managed. Small business owners can manage just by knowing what is going on. But, when the business grows to where they must depend on others to manage the business, owners need to define their business clearly, and reconsider what is organized and managed.
The generally accepted definition of the enterprise business is “the activity of providing goods and services”. If we accept this definition or the R-pM definition of a business enterprise that “utilizes capital in performance solutions to produce value in results”, then the business is defined by two entities:
- Results: Specific economic outputs that must be produced by business performance
- Performance Solutions: Specific capital that must be utilized in performance to produce specific results
Results are the inputs to and the outputs from performance. A result is a specific accomplishment, like customer order recorded, that can be counted and measured. Capital is utilized through performance solutions to produce results. A performance solution is an item of capital, like a human salesmanship capability solution, utilized to produce the result. The business organization is updated with each result or performance solution change.
Business management optimizes performance capacity used for result volume, performance costs against result value, performance effectiveness for result quality, performance uncertainty that introduces result risk, and performance expectations to reach result goals.
As the business is organized and managed, the organization and management structures laid over the business today that cause unsolvable problems and prevent business management are abolished.
Business owners must take charge to organize and manage their business
Business owners have the ultimate responsibility for their business. This responsibility cannot be delegated to others. The business owner must ensure that the business is organized and managed properly.
Organizing and managing the business with R-pM, is to the benefit of capable and productive management and staff. These benefits are described in other articles in this ongoing “How you Benefit from R-pM” series. R-pM focuses on the results the business must produce, organizes capital to be properly managed by those with the capability, clarifies responsibilities, eliminates counter-productive empires with their own agenda, simplifies the performance solutions needed, and clearly reports the business for good management and governance.
Many inside and outside the business with a vested interest in current methods will resist efforts to organize and manage the business. This must be recognized and managed by business owners to eliminate unsolvable 20th century problems and gain the advantages of 21st Century Management.
The information needed to use R-pM is provided in the R-pM Toolkit
R-pM is the future of business management. This article may have left you confused about R-pM. Go to result-performance-management.com to learn more under What is R-pM?. The guidance you and your business need to gain immediate advantage from R-pM is provided in the R-pM Toolkit.
