Archive for 'Ten R-pM Rules'

Corporations are governed by enforcing rules, because we do not manage the corporate business

Corporations do not organize and manage the actual business, “the utilization of capital in performance to produce value in results”. Actual business data is not captured and business management information for performance capacity, cost, and effectiveness producing result volumes, value, and quality is not available to govern approved business strategies and plans.

Instead of organizing and managing the capital utilized and output results produced by the business, organization and management structures are laid over the business. These contrived structures prevent the actual business from being managed or governed. Management information does not measure and report the actual business, but measures and reports against contrived overlaid structures, such as corporate plans and budgets, business processes, charts of accounts, scorecards, and the like. This requires a large effort by the corporation to collect duplicate and conflicting data related to each structure and to process high volumes of reports that do not report the actual business.

Corporations can only govern by enforcing rules and regulations. 20^th century management always addresses the corporate governance problem from the governance side with more costly rules and reporting requirements, instead of addressing the large corporate management problem on the corporate side.

We need to govern strategic value creation by managing the corporate business with R-pM

Good corporate governance requires that we clear away contrived 20^th century management structures laid over the business that complicate management, and directly organize, manage, and report the business to simplify management and governance. The means to do this is Result-performance Management (R-pM), as explained further in the article “Seeking Good Corporate Governance by strengthening Bad Governance“.< [more...].

The biggest complaint about 21^st Century Management with Result-performance Management (R-pM) is that it requires more discipline to document and manage what the enterprise is actually doing compared to conventional structures. R-pM requires more discipline, but not more work, when the enterprise directly manages a simplified and organized business.

20^th Century structures are contrived and may or may not reflect the real business and may or may not be used

20^th Century enterprises can contrive any organization structure as an overlay on the business. Charts of accounts are contrived to meet accounting needs and may not accurately record the business. Business processes are contrived workflows that may not be followed. Management reporting can be contrived to report anything. Results are added or completed and capital is redeployed, but the organization structure, chart of accounts, or other structures do not have to change, and just become further removed from the changing business.

These overlaid structures and the lack of discipline also give us the unsolvable 20th century problems discussed in the Business Change Forum.

21^st Century Management has only one requirement: The enterprise must organize and manage the business

Result-performance Management (R-pM) is the conventional method to organize and manage the 21^st century enterprise. R-pM organizes and manages the business with one integrated business structure to manage economic business outputs in results and the invested business capital utilized to produce the result in performance solutions. [more...]

There are many methods for capital development project management, but they all have difficulty planning and developing specific project benefits, gathering development costs for specific capital to be utilized in operations, and relating the costs of specific performance solutions developed to the actual benefits provided in operation to measure the return on investment. We have discussed these difficulties in many “Capital Development Plans and Projects” posts in the Business Change Forum.

21^st Century Management manages investments to gain a planned result value return

Rule No. 7 of The 10 rules of 21^st Century Management with R-pM: Manage investments to gain a planned return. The enterprise cannot manage the benefits of development unless the specific results to be produced by the developed capital are defined and managed. The enterprise cannot manage costs against the benefit to know the specific return on investment, unless the specific performance solutions being developed are defined and managed.

Result-performance Management (R-pM) is the conventional method to organize the business for 21^st Century Management. R-pM uses unique bottom-up Result-performance Development to develop both the costs and benefits of development, so that they can be tracked into operation to provide the planned and managed return on investment.

R-pM provides a business structure for capital development project results produced and performance solutions utilized for effective project management and to capture of costs of new solutions developed as project results.

Do not attempt any capital development project without studying and understanding the benefits of R-pM as summarized in the article “R-pM for Capital Development Project Management” in 21^st Century Management Magazine.

21^st Century Management eliminates 20^th century problems

Result-performance Management (R-pM) eliminates the capital development problem and other costly 20^th century problems. Slash costs, simplify business management, and boost competitive advantage through R-pM, the conventional method for 21^st Century management.

Download your 21^st Century Management Manual today

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 explains how to manage capital development projects with R-pM to know the results being improved and the performance solutions being developed to add future value to the results for the value-added return. Get your R-pM Toolkit, and future updates, at result-performance-management.com.

Many posts at the Business Change Forum discuss the problems with 20^th century accounting and the need for professional records management for 21st Century Management. Rule No. 4 of the Ten Rules for 21 Century Management is: Keep records on the full cycle of cost and value in operations and development.

Today’s enterprise faces many obstacles to professional record capital management provided by R-pM. Financial accounting is often seen as enterprise records management, but maintains a professional view of what it will record, and acts as an administrative function, rather than professional records management. Financial accounting does not record the business, but accounts against a chart of accounts overlaid on the business.

This subject is discussed in an article in the 21^st Century Management Magazine, Broaden Financial Accounting to provide Professional Records Management. The article shows how R-pM provides a unique opportunity for the accounting profession to expand to professional records management. Professional facility records management maintains financial and non-financial facility records of the actual business, and provides information capital solutions from records, where needed to produce results at all levels of business management.

This article is important for the future of professional business, financial, cost, or management accountants and anyone in the accounting, auditing, and records management profession. If you are in the industry, read the article carefully and forward it your fellow professionals, for their views.

21^st Century Management eliminates 20^th century problems

Result-performance Management (R-pM) eliminates the records management problem and other costly 20^th century problems. Slash costs, simplify business management, and boost competitive advantage through R-pM, the conventional method for 21^st Century Management.

Download your 21^st Century Management Manual today

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. Get your R-pM Toolkit, and future updates, at result-performance-management.com..

How do you define performance?

A recent article in 21^st Century Management magazine “Years of Management Problems because of the flawed Definition of Performance“ expands on a problem that we have discussed several times. The article explains how the flawed definition of performance prevents us from following the first rule of 21^st century management: organize and manage the business.

The accepted definition of performance, to include results, prevents organizing and managing the business

The generally accepted definition of “Business” is “the activity of providing goods and services”. The problem is that the generally accepted definition of “Performance” labels not only execution of actions in business activity, but also business accomplishments or results, such as goods and services, as performance.

In order to organize and manage the business, we must split business activity apart from business goods and services to organize and manage performance separate from results. [more...].

The 21^st Century Management magazine at R-pM.net, has begun a series of articles on the “Ten Rules to Organize the Business for 21st Century Management” to guide business organization for competitive 21^st Century Management.

The ten rules are: [more...]

Does your organization structure organize your business?

If you ask most managers if their enterprise organizes the business, they will answer “yes”. However, if you ask them to described how the business in organized they will say that the business is organized into departments, functions, regions, etc. But, is this organizing the business?

Look up the definition of enterprise business. You will likely find that the enterprise business is “the activity of providing goods and services”. When you organize your business, do you organize “the activity of providing goods and services”?

20^th century organization theories organize people and responsibilities

20th century business organization theories provide all kinds of ways to organize people, regions, responsibilities, etc. but they do not organize the business. Instead, they contrive different kinds of organization structures that are overlaid on the business. [more...].