True Business Transformation to eliminate the Problems that caused the Financial Crisis

Business transformation was a big thing over the past fifteen years. But did it solve the fundamental problems with a sound structure for business success; or did it simply rearrange the 20^th century management methods that are the cause of business problems? We see the problems suffered by financial institutions that cannot manage “asset value” and corporation that are unable to manage the business that cause the financial crisis and economic recession.

20^th century business transformation did not provide the level of benefits expected

Business transformation changes the organization structure, strategy structure, business process structure, performance management structures, account structures, information technology architectures, management information structures, and other structures that are laid over the business, rather than organizing and managing the business. Many 20^th century business transformation methods are discredited today.

Result-performance Management (R-pM) organizes and manages the actual business. The business is defined as “investments in capital as solutions of worth utilized for costs and effectiveness of performance to produce value and quality in results”. The business consists of output results produced, the capital investments in specific solutions, and solutions implemented and utilized in performance to produce specific results. R-pM is the final business transformation to organize the business for 21^st Century Management. R-pM organizes the business into one integrated business structure that changes with the business and never needs further transformation.

Conventional business transformation cannot transform the business, because the business was never organized

The conventional 20^th century business organization methods never organized the business. If the business was organized, business change would change the organization automatically, instead of having separate business change and transformation projects. The business changes with every major business decision, not every few years when management decides it is time for business change. The only reason that business transformation is needed is because the business is not organized and managed. Conventional business change and transformation is not change to the business, but change to the structures laid over the business.

Business process re-engineering and other methods were hailed as business transformation

The main impetus for business transformation was business process reengineering (BPR). But BPR just organized conventional methods into a business process to solve some problems but creating others. BPR mixed results, capital solutions, and performance together into a monolithic business process. BPR made future change difficult giving rise to change management to overcome the added problems of change. BPR isolated the process from the information systems, giving rise to Enterprise Resource Planning Systems to address, but never actually solve, that problem. Instead of transforming the enterprise to solve problems, we kept creating bigger problems, requiring large investments additional solutions, which could only address the symptoms, but never solve the unsolvable problems.

Business transformation is a big word for rearranging problems, rather than implementing the needed solution

So, unfortunately, business transformation is just a big word for rearranging and renaming dead-end 20^th century management methods. Now, business transformation conjures up “out of the frying pan into the fire”.

Because of this bad connotation, we usually avoid the words “business transformation”. But, business transformation does convey our objective. We define business transformation as redefining and restructuring the enterprise business into the one fundamentally-sound right way for business success. Once the business has been transformed, the business structure will change naturally as the business changes and never need further transformation.

Result-performance Management (R-pM) is the final true business transformation

R-pM provides the one fundamentally right way to organize the business. R-pM organizes the results that the business must produce for success, the capital solutions that must be available, and the performance that utilizes solutions to produce the results into one business structure. R-pM organizes existing output results and capital solutions as part of the business, and removes structures laid over the business. R-pM uses the business structure for all business organization, planning, direction, control, reporting, and governance.

R-pM provides management one set of consistent, complete, and accurate business management information to avoid the problems that caused the financial crisis.

• Result values and full performance costs to manage result chains and result value-added across the business
• Capital solution qualifications and performance effectiveness to manage result quality result by result
• Capital solution reliability to manage performance uncertainty producing result risk
• Capital solution capacity utilized in performance to produce a volume of results
• Planned strategic result value and the solutions required to produce the results
• Actual results against period goals and performance against ongoing expectations
• Period by period result value creation and updated strategic estimates for good governance
• New capital investments justified by the planned strategic result value-added
• Capital development projects managed as a business to know the amount invested in all tangible and “intangible” assets
• Individual capital solutions utilized to know the investment amount, the amortization of investments, and the return on investment
• The “asset value” which is the worth of each capital solution from utilization to produce result value-added and the result value-added from sale or disposal

Managers today do not know this and much more essential business management information in order to manage investments in capital as solutions of worth utilized for costs and effectiveness of performance to produce value and quality in results.

R-pM organizes the business structure that changes each time a result or capital solution is activated, changed, or deactivated. R-pM manages a new range of capital measures, performance indicators, and result metrics. Each result has has a responsible manager with result goals, and each capital solution has a responsible performance manager with performance expectations.

21^st Century Management eliminates 20^th century problems

Result-performance Management (R-pM) eliminates the business transformation problems and other costly 20^th century problems that cause the financial crisis. Slash overheads and costs, simplify business management, and boost competitive advantage through R-pM, the new conventional method for 21^st Century Management.

Your 21^st Century Management Manual, The R-pM Toolkit, is available today and is under continual development to expand and refine 21^st Century Management. The R-pM Toolkit subscription is offered at a nominal price to encourage wide use of R-pM. Get your R-pM Toolkit, and future updates, at result-performance-management.com.

The R-pM Solution to the Economic Crisis is explained in free downloads

Three free white papers explain the dead-end 20^th century management problems, such as investment analysis, that caused the economic crisis, the way R-pM eliminates the problems, and a government program to address the crisis by stimulating the economy, solving the problems, building an architecture for financial and economic management, and organizing local businesses to flourish in the eventual recovery.

• How to Eliminate Problems that caused the Economic Crisis explains the major unsolvable 20^th century management problems and the R-pM solution
• The Only Solution to the Economic Crisis explains how R-pM manages the business to capture actual business data and provide management the information needed for actual business management
• A Government Business Management Program to Answer the Economic Crisis outlines a government program to encourage business management and manage economic cycles to prevent future crisis

These three white paper downloads are available to R-pM Community Members at Result-performance Management.com. There is no cost or obligation to join the R-pM Community. Join by entering your email and password. Your email address is protected and used only for download problems and occasional R-pM Member news and white papers.

This entry was posted on Friday, November 21st, 2008 at 01:46 and is filed under:
Forums: Capital Development Plans and Projects, Organization and Management, Business Change Methods, The Solution to the Economic Crisis
Topics: Breakthrough Innovation Management, Business Change Methodologies, Conventional Management Methods, Business Transformation
Result-performance Management (R-pM): The 21st Century Enterprise
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